EOC Week 4: Avon

Avon Cosmetics has been a well known brand among women for many years. It wouldn't even be a shocker if men are familiar with the products for various acne needs. Although the brand has had a very well branded name, profits have fallen 75% over the last 10 years. Avon has failed to adapt with technology and the changing times. While most companies have chugged along nicely with the changes, Avon has tried to keep the same business model it has for the last 70 years. Door to door cosmetic sales women seems to be what they want. Problem is, our market is basically like a ADHD student. We want things now and cheap. Although ordering online takes time, the cheaper price still seems to grab the attention of the consumers.

Avon even rejected a buyout offer worth about $10 billion from fragrance maker Coty Inc. Not only did the buyout come out to about ten billion dollars, but it was above the closing market price in the stock market. When the offer was made, the closing stock price was at nineteen dollar and thirty six cents. The ten billion dollar offer for twenty percent of the stock was priced out at twenty two dollars and ninety five cents. Avon over the last few years has been struggling to make a profit. Sales have consistently gone down over the last few years. While Avon has stuck to its guns and tried to be the same company it was 60 years ago, it’s time to evolve and get with the technology program. Avon has been a house hold name in American homes for decades. They have and still do provide superior products and services. The irony of this whole situation is the same business model that made them a power house is the same business model that killing them. Hopefully the new CEO will bring Avon back to life!