Integrated Model Of Cause-Related Marketing Strategy Development

Statement on the Thesis

Describe about the Integrated Model Of Cause-Related Marketing Strategy Development?

Avon is one of the World’s major direct retailer company and a chief worldwide beauty business. The company have an annual income of approximately 9 billion dollars. The products of Avon include fashion, home products and beauty.

Avon is a company abrupt in custom, stuck by its main principles and values. The vision of this company is to become the company, which understands the demand of the clients and satisfy its clients by their services and products.

Every day, Avon brings attractiveness to the life of all women in the world. The company’s beauty means to find the correct shade of lipstick for a client. The company also provides an opportunity for woman to income by selling the products of Avon.

The paper describes the strategies faced by Avon and how Avon overcomes all the problems by entering into Joint Venture strategy.

The research makes simple to estimate and recognize the strategies of Avon when they entered into the market. Avon maintains four strategies which includes –

Sufficient power to assure clients and tolerant challenges

Protecting the expansion of chances through consumer

By dealings with adding value and operational portfolio is changed.

Building a trustable position in front of its customers (Cavusgil at el. 2014)

The strategy of Avon was mainly developed to expand its business all over the World. The focus is on the transaction flow and maintains a balance sheet. Strategy of a company always maintains the financial condition of the company by giving the guarantee an equal strong growth from the last business.

The major aim of the research is to estimate and recognize the strategies followed by Avon. The research includes the hard work of Avon to spread its business all over the World.

Domestic Strategy vs. International Strategy:

A well business strategy supports the main business purpose and mission, and plans to operate as a path for continued success, growth and competitiveness. Businesses produce strategy for every field of business processes. Each approach includes short-terms plan and long-term plans resulting in the method and performance essential to achieve targets and goals (Liu et al. 2014).

Avon pursues a worldwide strategy by appearing for the largely professional customs to produce and accomplish its business. The company follows economies of extent and possibility in marketing, manufacturing and logistics by choosing the mainly commercial ability scales and locations of business on an international basis. Avon sticks only with their products development if they find any new demand from consumers. Beside of producing multiple cosmetics, Avon was capable to locate an approach to create international products. Due of these, Avon was capable to retail its identical products in 45 countries. Just Avon need to change its way of marketing and packaging. The company goes through strict custom before entering its products in market. The US clients first tested the product of Avon, which they want to take worldwide, before entering the market. After approving the product by the US clients, the product goes for “Avon’s Global Product Council”. In every steps of entering into a market, there are numerous steps (Ryan, 2014).

Purpose of the Research

Estimating costs, benefits, and risks:

Generally, it is almost easier to estimate the costs, benefits and risks to developed market condition of a country than to estimate the costs, benefits and risks to develop the economic condition of a country. Nevertheless, there is a reasonable quantity of subjectivity concerned apart from the questions raised in a market. This can be understood well be establishing an example suppose boss must not only approximate the costs required in beginning a foreign process, but the manager should also estimate the coasts of opportunity. Besides all this, the manager should also be concerned with the risks and benefits that may arise in future (Christopher et al. 2012).

Avon needed to Estimating costs, benefits, and risks when the company faced problems like

Field is not occupied

Store is inactive

Operation are not enough (Verbeke, 2013).

In reaction, the methods that are taken by U.S. are declared as investing and strengthening in high possible districts, and growing agent interactions and relations. The company divides U.S. into 850 districts.  According to the management, the 850 districts have a Hispanic population, and they improved themselves than others. Furthermore, average orders are from Hispanics and it is approximately 11% more than average order. An important step that Avon took in is to raise the entry fee in U.S. The company’s strategy is to enhance the cost and include goods to the first course kit (David et al. 2014)

Joint venture (JV) is a intentional agreement involving two or more persons to involve in a definite venture or enterprise. Joint ventures are more or less similar with the partnerships the only difference between partnership and joint venture is that a partnership generally engages a progressing, continuing business relationship, but a joint venture is engaged with only single business venture (Killing, 2012).

The advantages of joint venture in business are as follow –

Joint venture is concern with the chance of expanding new ability and capability

It permit a business to enter interconnected businesses or market and to achieve new technical knowledge

Entrance to greater capital, which includes particular employees and technology

It involvement of risks with the other partner

It can be flexible that is it can have a restricted life span that can only cover a part of what is done. Thus, it limits both the promise and publicity of the business.

In the age of consolidation and divestiture, Joint Ventures offer an innovative way for business to outlet from the non-primitive businesses.

Domestic Strategy vs. International Strategy

A business can slowly differentiate from rest of the business, and ultimately, retail it to any other companies. Approximately, 80 percent of joint ventures finish with deals from one partner to other (Saha at el. 2015).

The advantages of joint venture in business are as follow –

It is challenging for Joint ventures to takes effort and time in order to construct the accurate relationship and collaborating with any other business.

The objectives of the enterprise are not 100% clear and conversed to every person involved in the joint venture.

In joint venture, there is an inequity in point of knowledge, venture or property brought by different partners.

Altered management and cultures styles effects in poor combination and collaboration.

The partner in the joint venture does not give sufficient leadership and maintain in the early phases.

Achievement in joint venture is responsible on systematic study and investigation of objectives (Liang at el. 2012).

Avon possesses 60percent of the joint venture. The company made an initial venture of 1 million dollars and procedure to enhance its equity venture as extra funding is necessary to do so. Though the contract permits for manufactured goods supplied throughout worldwide, the business plans is to turn over its transaction operation steadily. To start this, the company have to inform to approximately 10 millions of its customers.  The company will give the venture with some kit, cosmetics, technological capability and sale the product. It is permitting the technology and brand name to joint ventures. Avon’s strategy is to earn adaptable foreign money by selling its products abroad. At first, the venture will produce 80 – 90 fragrance and skin-care products (Dan, 2013)

Conclusion:

Under the leadership of Andrea Jung’s, Avon faced numerous of challenges. Some challenges cannot be tackled but some were tackled successfully. Jung was correct in admitting that Avon’s major capability is the direct selling of products and its core strength the brand name. Again focusing on the major capability, recovering efficiencies and adjusting to the surroundings with new proposals, Avon might overcome all the obstacles faced in the past and revolve the business in a new direction. 

Reference:

Liu, G., & Ko, W. W. (2014). An Integrated Model Of Cause-Related Marketing Strategy Development. AMS Review, 4(3-4), 78-95.

Ryan, D. (2014). Understanding digital marketing: marketing strategies for engaging the digital generation. Kogan Page Publishers.

Christopher, M., & Peck, H. (2012). Marketing logistics. Routledge.

David, M. E., David, F. R., & David, F. R. (2014). MISSION STATEMENT THEORY AND PRACTICE: A CONTENT ANALYSIS AND NEW DIRECTION.International Journal of Business, Marketing, & Decision Science, 7(1).

Killing, P. (2012). Strategies for Joint Venture Success (RLE International Business) (Vol. 22). Routledge.

Saha, A., & Chattopadhyay, U. (2015). The Impact of International Joint Venture on Local Economy: A Case Study of Hero Honda. South Asian Journal of Business and Management Cases, 4(1), 14-26.

Liang, X., Lu, X., & Wang, L. (2012). Outward internationalization of private enterprises in China: The effect of competitive advantages and disadvantages compared to home market rivals. Journal of World Business, 47(1), 134-144.

Dan, M. C. (2013). Why should university and business cooperate? A discussion of advantages and disadvantages. International Journal of Economic Practices and Theories, 3(1), 67-74.

Cavusgil, S. T., Knight, G., Riesenberger, J. R., Rammal, H. G., & Rose, E. L. (2014). International business. Pearson Australia.

Verbeke, A. (2013). International business strategy. Cambridge University Press.