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Avon Works to Transition to ‘Upper Mass’

Avon's color brand, Mark, will be expanded to more markets as the company looks to get customers into products with higher price points.

Avon Products Inc. is looking to move up in the world.

“We’re positioned as a mass brand,” said Avon chief executive officer Sheri McCoy at the ICR Conference in Orlando, Fla., today. “Moving forward, [our goal] is to move into upper mass…as we look to the future, it’s important that we do that.”

Avon’s mass color line will be re-branded and upgraded to Avon True, McCoy said, and be aimed at consumers looking for reliable, effortless makeup products. Masstige line Mark will be introduced to more markets as a means to introduce shoppers to higher price points.

“We’re now taking it through Latin America and Europe,” she said of Mark. The idea is that those customers will eventually make it into even more expensive skin care, McCoy outlined.

McCoy also gave an update on Avon’s progress with its Transformation Plan, which remains ahead of schedule on the cost-savings side, she said. For 2017, the focus is now shifting toward “investing in growth,” she said, though Avon anticipates 40 percent of expected cost savings will come this year. Back in January 2016, Avon said it planned to cut $200 million in supply chain costs and $150 million in other costs through the Transformation Plan. The saved funds will be used for investment in growth initiatives, including media, social selling and information technology systems to modernize the business, Avon said.

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The company has outlined $150 million for media, advertising and social selling, and $200 million for information technology systems, according to McCoy. The idea is to give Avon’s sales representatives tools related to video sharing, tutorials and spreading information with friends.

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“We’ve been testing a social selling platform in Buenos Aires,” McCoy said, adding that Avon would likely continue to test that system and eventually bring it over to Europe.

For 2017, Avon will focus on driving performance in its top markets, building out its capabilities and its talent base, investing in the Avon brand and improving engagement with representatives, according to the company. “Growing and improving the engagement of our representatives, to me, that is the most important thing,” McCoy said.