Cosmetics maker Avon Justine will open franchise stores at selected shopping centres to attract new customers, enter high income areas and grow revenue.
Last November, the company opened its first Justine retail platform at Mall of the North in Polokwane, Limpopo.
The company’s traditional business model is working with representatives to sell directly to consumers. In a bid to expand its reach, some resellers will partner with the company to establish a physical presence in the form of kiosks or stores.
Mafahle Mareletse, MD for Avon Turkey, Middle East & Africa, said having a retail presence will help consumerswho are unable to access representatives or do not want to buy online.
The retail channel is in line with Avon International’s omnichannel strategy to increase revenue and reach higher income areas that Avon Justine has been unable to penetrate through its core direct selling model.
It’s a serious business ... some even have employees and mini warehouses at their homes
— Mafahle Mareletse, MD for Avon Turkey, Middle East & Africa
Avon and Justine are owned by Brazil’s Natura & Co.
The retail channel “also aims to provide our consultants and business owners the opportunity to access higher income consumers an opportunity to physically test, trial and experience Justine products.
“The goal is to achieve greater brand awareness and further establish our brand as one that offers quality products at an affordable price to the everyday woman while building a future-fit organisation that is agile and sustainable,” said Mareletse.
He would not say how many stores or kiosks will be opened. However, the first phase of the retail channel launch will be in cities.
Mareletse said Avon has received a “good reception from shopping centres, including high-end malls. That shows the power of Avon. Many people grew up with these products.”
Avon Justine has opted not to sell products at existing retail stores as its model seeks to help women entrepreneurs.
The bulk of its business is via direct selling. “We have a unique strength — our business is about personal relationships. People buy from reps who they have a relationship with ... hence the model still works today,” he said.
However, it is also aggressively growing online sales, with some resellers increasingly using digital platforms created by Avon Justine to market their businesses. There are features on the websites and mobile apps that enable representatives to create their own online shopping site.
“Whether one works full-time or part-time, works from home or is just passionate about beauty, our digital channels allow anyone to do 'Beauty Your Way' any time, anywhere,” he said.
Mareletse said the majority of representatives are women who have full-time jobs, though some have made businesses from selling the products. “It’s a serious business ... some even have employees and mini warehouses at their homes,” he said.
In its research into the cost of living, which was published in September, Avon found that four in five women worldwide have or are considering taking up a side hustle to help with the cost-of-living increase.
Like many businesses Avon is still recovering from the pandemic while also navigating the macroeconomic challenges such as high inflation and high unemployment.
Mareletse said some of Avon’s clients are downgrading to more affordable products, but the company is gaining new clients from rivals as it provides “high-quality products at incredible value for money”.
“Everyone is under pressure. Our clients have lost jobs and some are trading down. We do a lot of blind testing and in many cases people rate our products better than premium products. That's where we are seeing an opportunity from the challenging economic conditions,” he said.
More than one-third of women (38%) have dropped their favourite branded products this year in favour of cheaper alternatives, according to Avon’s findings.
Avon’s sales in South Africa are not back to pre-Covid levels, but Mareletse is confident they will be reached next year. “The past two years we have seen improvements, so we are getting nearer there.”
Avon imports most of its products, but manufactures Justine items locally at four facilities.
According to Mareletse, Avon’s best-sellers are fragrances followed by makeup. Young people are also embracing the brand and, through the company’s partnership with the University of Johannesburg, where it is offering a programme in direct-selling marketing, he hopes to have more of them on its database as resellers.
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