Professional Documents
Culture Documents
The ARTISTRY* development of new formulae using Standardising elements of the marketing The product life-cycle Injecting new life
range of cosmetics state-of-the-art manufacturing tech- mix is key to operating successfully into the Artistry life-cycle
niques. This case study focuses upon in the global marketplace. As a result, Markets are in a constant state of
INTRODUCTION Over the last 31 years Amway has how Amway has recently injected life common needs and wants are identi- change. Over a period of time, tastes
To prolong the life-cycle of a brand
THE AMWAY CORPORATION invested heavily in the development of into the product life-cycle for its fied across countries. At the same time, and fashions alter and the technology
or product range, an organisation
Founded in Ada, Michigan in 1959, Amway has become one the Artistry range of Skin Care and Artistry range to maintain this proac- parts of the marketing mix requiring used to produce goods and services
must inject new life into the growth
of the largest Direct Selling companies in the world with moves on. As a result, there will
Cosmetics. The range comprises tive position and keep ahead of its adaptation are identified so that it can period through readjusting the ingre-
nearly three million Independent Distributors. Direct selling always be a demand for new products
approximately 3,257 individual lines competitors. be developed to cater for local differ- dients of the marketing mix. In 1996,
as old ones become redundant.
involves dealing with customers face-to-face so that person- which are sold in over 30 countries ences. This requires a thorough under- to ensure the Artistry range would
al attention can be given to each of their requirements. Direct throughout the world. Global marketing standing of every market in which According to the product life-cycle stay in line with evolving market
selling differs from traditional retailing as it often involves Amway operates. concept, all products move through trends and tastes, Amway set about
Based upon a recent Euromonitor
selling to consumers on a one-to-one basis, usually in the Amway is a global organisation which four life-cycle phases. During the upgrading its brand with the additional
study of global sales data: Many advantages arise from competing
comfort of their own homes. The industry has grown rapidly markets products in international introductory phase growth is slow
objective of increasing its global
in a global marketplace, including:
over recent years and is currently estimated to be worth 40 Artistry is among the worlds ten market places. Planning for global and volume is low because of limited
competitiveness.
billion a year world wide. This case study examines this largest brands of facial skin and markets is a much more complex economies of scale - over a larger awareness of the products existence.
growth which has helped Amway to become one of the colour cosmetics process than for domestic markets. It output, costs per unit are decreased Sales rise during the growth phase and Amway engaged in world wide market
industrys market-leaders influenced by changing presents many more risks than operat- to provide the supplier with a com- profit per unit sold reaches a maxi- research to gain a comprehensive
Artistry is the largest direct sales mum. As products reach maturity, understanding of the needs and wants
lifestyles, demographics and economic recession. ing in a domestic market where goods petitive advantage. Amway is able
brand of facial skin care and colour growth in sales starts to level off. of target markets.
are sold in only one local area. Global to spread its research, develop-
cosmetics in the world. Organisations have to invest heavily to
marketing involves recognising that ment, technology and distribution Market research is the systematic
extend the life-cycle while competition
people from all over the world have costs so that it can maximise its gathering, recording and analysing of
Direct selling for Amway Amway has developed becomes stronger. When sales start to
into a global corporation
Product development different needs, i.e. values; customs; production efficiency data about positives and negatives
is undertaken by its own fall a product is said to be in decline.
languages; rules and currencies. relating to the marketing of goods and
independent distributors. manufacturing over 450 the development of new business
Research and development play a In a global environment, managing and services.
Their own income is based products and employing Though it is said that consumer opportunities - in numerous coun-
vital commercial role creating better maintaining the market share for fash-
on the goods they sell, more than 12,000 people needs around the world are converging, tries, markets are growing faster Through acquiring a substantial know-
products through improving opera- ion products is particularly demanding.
bonuses paid by Amway in over 80 countries and there are commonly accepted needs than in Europe and America.
tional processes and helping the whole Cosmetic manufacturers are constantly ledge of each marketplace, the mar-
and the volume of sales territories around the and wants that go beyond national Overseas markets offer the oppor-
business focus upon its customers. challenged by different changes in the keters could identify elements of the
generated through their world. To supply a global barriers. The marketing mix consists tunity to compete in different mar-
Artistry products are the result of years fashion industry. If these changes are marketing mix which could be stan-
own distributor network. base of customers, Amway
of a complex set of variables which ketplaces and extend the life-cycle not properly managed, products could dardised, in addition to elements
These distributors sell to manufactures products of research, development and testing,
an organisation combines together of products quickly move into decline. requiring change.
people they know or meet. ranging from household supported by modern manufacturing
in order to ensure that both global
Amway distributors oper- cleaners to cosmetics, food principles. Amways research is to meet the tastes of consumers
and local corporate objec- Introduction Growth Maturity Decline
ate as their own indepen- supplements to house- proactive, taking the lead in a from different nations - over
wares. It also markets tives are achieved.
dent businesses. market by researching the recent years there has been a
Sales
Amway is a long-standing products on behalf of other newest ingredients in the convergence of tastes resulting in a
member of the Direct leading manufacturers, industry for continuing more global marketplace.
Selling Association (DSA) such as Kenwood, Aiwa Time
in the UK and Republic of and Philips. Product life-cycle
Ireland. The DSA regu- Introduction Growth Maturity
lates the industry by pro-
viding a Code of Conduct
Sales
endorsed by the Office of
Fair Trading (OFT).
Time
Injecting new life into the product life-cycle
The Times Newspaper Limited and MBA Publishing Ltd 1999. Whilst every effort has been made to ensure accuracy of information, neither the publisher nor the clients can be held responsible for errors of omission or commission.
THE TIMES 100 Edition 5