Avon Products Inc. has hired Jan Zijderveld, a 30-year Unilever veteran, as chief executive officer.
Zijderveld was most recently president of Unilever’s $14 billion European business and a member of the company’s executive committee. As the head of the European division, Zijderveld oversaw a segment that spans 34 countries and has 25,000 employees. While he was there, the division improved performance and returned to profitability.
Before his role as president of the European business, Zijderveld was ceo of Unilever Middle East and North Africa, where he orchestrated joint venture partnerships and put distributor and go-to-market models in place. Zijderveld has also held leadership positions in Australia and New Zealand.
Zijderveld follows Avon ceo Sheri McCoy, who joined in 2012. Avon declined to immediately make him available for an interview.
“I strongly believe in the opportunity and relevance of direct selling for today’s representatives and consumers,” Zijderveld said in a statement. “With a dramatically changing consumer and competitor landscape, business as usual is not an option. Alongside continuing significant operational improvements in the near term, we will take a fresh look at the business and deliver Avon’s next chapter with a sense of urgency.”
Zijderveld comes to Avon as the company works to execute its turnaround plan. For Avon’s third fiscal quarter, the business posted a 1 percent increase in revenue and $11.9 million in net income.
“Avon has a big challenge in terms of the systems they need to get in place,” said D.A. Davidson analyst Linda Bolton Weiser. “The modernization and upgrade of systems has begun, but they have more to do.” Zijderveld should also concentrate on Avon’s “execution issues,” Weiser noted, citing Avon’s delivery issues in Russia and trouble in the U.K. “In the last year or two, execution issues have overshadowed any of the progress,” she noted.
“Leadership is important,” Bolton Weiser continued. “Getting out there to the many markets and meeting representatives and reenergizing them — that’s going to be important.”
Bolton Weiser said she expects Zijderveld to carry on certain elements of the current plan at Avon, such as the cost-cutting program. “He’s probably going to need to look at some of the major markets where it seems like Avon’s performance has wobbled a bit,” Bolton Weiser said.
While analysts noted Zijderveld’s international experience is a plus, he, like former ceo McCoy, was said to lack direct-selling experience.
“We see Mr. Zijderveld as a very capable executive,” wrote Jefferies analyst Steph Wissink in a note. “This will represent the second [Avon] executive in a row to emerge from a MegaCo [consumer packaged goods company]; these learning grounds tend to lack in swift and decisive decision-making, agility and change agency.”
She also noted concerns about Zijderveld’s lack of beauty-specific experience. “The beauty industry has become much more fashion-driven than traditional [consumer packaged goods/home and personal care]. Today’s leading beauty brands have adapted to this new competitive market and have implemented strategies allowing them to tap consumer indicators and to identify and respond quickly to trends.”
Zijderveld’s appointment comes as Avon faces increasing pressure from activists that requested the company’s board consider strategic alternatives, including selling the company, in January.
The group — Shah Capital, Barington Capital Group LP and NuOrion Partners — which own about 3.5 percent of Avon, pressed the company’s board to consider selling the whole or parts of the business. But industry sources noted the sale path is one Avon has already traveled, with the sale of its North America unit to Cerberus Capital Management and the consideration of strategic options for the China segment.
Asked for a statement on Avon’s new ceo appointment, a spokesperson for the activist group said: “Though we are pleased with the appointment of a capable leader, we believe substantial changes should be made to Avon’s board of directors and its operation in order to deliver value to shareholders.”