Avon China President to Persuade the Chinese Government to Lift Ban on Direct Selling Presentation

• Direct selling involves the marketing of products or service to independent buys directly from a retail location.
• With direct selling, market negotiations and cost of adverts are reduced.
• Thus, direct selling business is called referral marketing.

Avon’s reaction to the Ban

• In 2008, Avon was the top direct selling company worldwide.
• Avon sold beauty products and services.
• The president of Avon made consultation with different stakeholders to remove the ban.
• Stakeholders include officials of SAIC and the Trade Bureau.
• Avon and other multi-level organisations made consultations with the Chinese state counsellor.

Avon’s strategy after the ban

• The president made consultations with MOFTEC state officials to remove the ban on direct selling.
• Avon’s president organised a series of meetings with media experts and journalist to diffuse the negative impression about direct selling practices.
• Pryor established a crisis management committee to discuss a new marketing strategy.

The company had three options after the ban

1. Create a political situation that would pressure the Chinese government to renounce the ban.
2. Leave China market.
3. Accept the new rule and regulations for direct selling.

The president’s reaction

• During the briefing, Avon’s president accepted the Chinese decision in regulating illegal companies with unethical practices.
• The move was tantamount to diffuse tension between both parties.
• Pryor addressed issues pertaining to employee welfare, field agents, public media, and customers.

Effects of the ban

• The ban triggered a series of uprisings by the employees.
• Avon’s president directed its crisis committee to accept refunds of products from the selling franchise.
• Avon’s financial presence in China stands at $70 million.
• Thus, building public confidence will put pressure on the Chinese government to suspend the ban.