Question

Scenario 2: Avon Malaysia Avon, being an international manufacturer and distributor of beauty, household, and personal care products, had believed in direct selling since its inception. It offered a wide range of beauty products, including skin care products, cosmetics, perfumes, spa treatments, make up, and everyday cosmetics & toiletries like shampoos, deodorants, and body lotions. Its product line included many recognizable names such as Anew, Avon Color, Skin-So-Soft, and Advance Techniques. Recently Avon has developed a set of new products called Avon Color. It is one of the leading cosmetic brands in the world. The products are mainly targeted at women in the age group of 25 to 50 years. The products are of high quality, are priced affordably, and positioned as products that provided value. The management team of Avon is facing two issues now – how should Avon extend the maturity of its products and what are the best distribution strategies for Avon? (Students will need to provide their answers in relation to the given scenario and context) Question 3 (a) Based on the scenario, explain THREE (3) types of Consumer Marketing Channel with relevant examples. (15 marks) (b) Based on the answer given in Part 3(a), using the THREE (3) consumer marketing channels, choose the right channel combination that Avon should adopt. Provide justifications with relevant examples. (10 marks) (Total: 25 marks)

Answer 1

Q3. A. Three kinds of consumer marketing channel are illustrated. One is direct marketing channel where the company directly sells products to customers through its sales team. For example, a sales person selling products by demonstration of products features to the customers. Another type of consumer marketing channel is selling through intermediaries. For example, a pharmaceutical company selling products through wholesalers and retailers. Here carrying and forwarding agent can also be recruited by a company to sell products. Another type of consumer marketing channel is using Omni-channel where a company selects more than one marketing channel to reach to customers. For example a company selling both offline and online through direct marketing and through website uses an Omni channel.

B. the selected Omni-channel for Avon Company is multi channel to reach to maximum numbers of customers. Consumer marketing multi channel provides more channels to reach to target customers such as Avon Company can sell products through direct marketing, and through website. Social media and online shopping are now trends among customers and they provide convince too to the customers. Digital touch points are integrated with direct marketing efforts. Thus, Avon should consider choosing direct marketing channel and website and social media platform to promote its products.

q4. A. the product life cycle of product Avon Color is elaborated. Recently the Avon Company has developed product colour that is a cosmetic product. Thus the product has passed the product development stage. Product development stage takes place when the product is not developed and development process is going on. Next comes is introduction stage where the product is introduced in the market. Avon Color is currently in this phase. Avon needs to bear high cost to reach potential customer. Avon Company needs to provide support to this new product by aggressive advertising and charging fewer prices. When Avon colour product will reach to growth stage, a high skimming pricing strategy should be practiced by Avon Company. Aggressive marketing should be practiced and a high price should be charged from customers. Next comes, maturity stage that is significantly longer in duration. Marketing growth of product is shrieked but product cost is reduced due to high volume production. Thus Avon Company needs to reduce expenditure on advertising and maintain its market share in the stage. Finally, decline stage of Avon colour marks decline in revenue and market share. Avon Company can discontinue Avon colour or find new use of this cosmetic product. Avon Company can also add new features in Avon Color product to revive this product.

B. to extend the life cycle of Avon Color, certain strategies is recommended. Avon can change the marketing mix of Avon Colour to extend its life cycle such as upgrading features of product, changing the shape, size, or packaging of product, adding values features by understanding customer’s needs, and lowering price. These changes can extend the life of Avon Colour. Avon can also sell Avon Colour product to those countries where the technology and features used in Avon Colour are demanded such as in developing and underdeveloped countries. Recommending new use of product can also extend its life. Thus, these strategies should be considered by Avon Company to extend product life cycle.