Avon calling on office staff to put on their sales hats | Crain's New York Business
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Avon calling on office staff to put on their sales hats
Struggling company brings all hands on deck in effort to step up sagging revenues.
By Cara S. Trager
Published: May 6, 2012 - 5:59 am
With its earnings sinking, its stock severely depressed and new Chief Executive Sheri McCoy barely two weeks into
her job, Avon Products Inc. is calling on all hands to grab the oars. Office-bound employees from administrative
assistants all the way up to executives are being drafted into an ad hoc sales force. As of May 1, participants are
reaching out to the company's famed army of door-to-door sales reps around the nation.
The two-week effort zeroes in on those doorbell ringers in the field who haven't placed a new order for supplies in
more than two weeks. They are being encouraged to boost sales—and their own income—by promoting such fresh
bargains as a package of 11 products, including SuperExtend Extreme Mascara and Anew Clinical Advanced
Wrinkle Corrector, which has a value of “over $200” but which reps can now snap up for a mere $50. The program
assigns employees five different reps to pitch each day.
“Every Avon employee is becoming an Avon representative,” said a headquarters worker, who declined to be
identified.
WHY ME?
Andy Watts, who oversees North American marketing, announced the push on April 24 to a packed meeting of
employees at Avon's Third Avenue headquarters. Many were said to be less than delighted to find themselves
drafted for what Avon is calling its “outreach campaign.”
An Avon spokeswoman said the firm doesn't comment on internal programs.
Meanwhile, some analysts are voicing skepticism about the push.
“This smells of desperation,” said Ali Dibadj, a senior analyst with Sanford C. Bernstein & Co. “We knew the
company was failing in the U.S., but this feels like a Scotch tape, short-term solution.”
It came a week after the arrival of Avon's new CEO. The sales drive also kicked off the same day Avon announced
that its first-quarter net earnings tumbled 82%, news which in turn triggered a 7.9% drop in its share price, to
$19.90. Management is also fighting a takeover attempt by beauty firm Coty Inc., rejecting its suitor's second and
most recent $10 billion bid on April 3. And on top of all that, Avon is the subject of ongoing Securities and Exchange
Commission investigations into the company's financial disclosures with analysts and possible bribing of officials in
China.
HELP WANTED
82% DROP
in Avon's first-quarter net earnings
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5/8/2012
Avon calling on office staff to put on their sales hats | Crain's New York Business
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It is in the face of all those challenges that Avon is now asking its employees to step up. To help them, the company
has sent out batches of materials, including two call scripts. Staffers also received emailed guidelines instructing
them to make their calls a “friendly and engaging experience for you and your representative,” and urging them to
sidestep any questions those reps might have about company-related news or developments.
“You must not speculate, elaborate or express any opinion,” the guidelines exhorted.
To further ease any anxieties, each staffer has also received staged recordings of successful calls dealing with reps'
questions about everything from service to the new CEO.
Early indications are that such hand-holding may be falling short.
“We heard from many different sources that morale has plummeted at Avon,” said Mr. Dibadj. “Good folks are
running out the door in the U.S.”
Ironically, he also thinks management's efforts could yet have at least one upside for an organization that has
famously been built on salesmanship. “This likely helps teach all employees that Avon is about selling, and that's not
a bad thing,” he said.
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