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Avon, you might be surprised to hear it,

was among the most popular,

recognizable, and respected brands in

the United States. It was considered the

country's largest cosmetics brand and

was pioneering with its door-to-door

direct sales method that was promoted

with one of television's earliest

taglines,

>> Avon calling.

>> Yeah, I mean, those commercials ran for

over a decade, and everybody was

familiar with them. But maybe more

importantly, Avon was practically seen

as a symbol of female empowerment.

Historically, the sales representatives

have been almost exclusively women,

commonly referred to as Avon ladies. It

goes all the way back to the 1800s, well

before women had joined the workforce in

a big way. It was decades before women

had the right to vote in the United

States. So, Avon was like one of the

main ways for women to earn money. But

obviously, things have changed quite a

bit over the past 130 plus years. For

many years now, Avon has struggled with

declining sales, higher debt, multiple

lawsuits, and overall losing that magic

that the brand once held. I'm going to

talk about all of it as I outline what I

believe to be seven of the biggest

reasons behind the decline of Avon. I'm

going to start off with what I think

might be the most obvious reason. I've

already touched on it a little, and that

is women working. See, Avon was started

by David McConnell. He would sell books

doortodoor. And a common sales

technique, especially back then, was to

offer a gift to people in exchange for

having them hear your sales pitch. Well,

considering this was during the 1800s,

most of the people answering the door

were in fact women. They would be

maintaining the household during the day

while their husbands were out at work.

He found that one of the most attractive

gifts that he can offer in exchange for

their time was a small bottle of

perfume. In fact, the customer started

showing far more interest in that

perfume over the books. So at that point

the logical step was to abandon the

books and transition into perfume sales.

And another logical step was to recruit

housewives to sell that perfume. They

better related to the potential clients

and were available. So by the 1900s

there were almost 100,000 Avon ladies

going doortodoor selling Avon products.

Actually the Avon name was not used in

the beginning. It was called the

California Perfume Company. I believe

because California was seen as a trendy

and exciting place. Throughout the early

1900s, the company was expanding beyond

perfume into face powders and lipsticks

and all sorts of related products. Avon

was the name of their most popular

cosmetics line. So in 1939, they made

that the name of the company. And if

you're wondering, that name comes from

Stratford upon Avon in the UK, famous

for being the home of William

Shakespeare. Following World War II,

things were taken to a new level when

there were more people starting families

than ever before, meaning there were

more housewives to sell Avon products

and to buy Avon products. Those famous

commercials help propel it even further

and by the 1970s, Avon was one of the

best performing companies in the

country. Forbes ranked it as the most

consistently profitable company in the

US and for the first time they reached

$1 billion in sales. However, according

to the population reference bureau, the

percentage of women in the workforce

increased significantly over the

following decades. And I think that's

pretty widely understood, right? So, the

cultural shift combined with economic

factors in the 1970s marked [music] the

first time where there was major doubt

concerning the future of Avon. Like I

said, this is kind of an obvious reason.

The company was created and built around

the fact that most women did not have

jobs, and that was clearly changed over

the years. There was a time when selling

Avon was widely considered to be among

the most attractive ways for women to

earn money and that is just no longer

the case. From there, I think they must

have felt the pressure to reduce the

reliance on cosmetics in their existing

system and the changes that they made

did not go very well. My next reason

behind the decline of Avon is

diversifying. Going into the 1980s,

Avon's big plan was to enter new

industries by making these multi-million

dollar acquisitions. And with almost

every one of them, it went poorly. Just

a few examples would be Tiffany &

Company, the jewelry brand. They spent

over $100 million buying it in 1979,

struggled to keep up with the

competitors for the next 5 years, and

then sold it. They went on to buy a

chemical company for $750 million and

then sold it at a loss only a few years

later. And then it was a similar

situation with a healthc care company

and a couple of nursing home companies.

All of them bought and sold within a few

years, leaving Avon with over a billion

dollars in debt by the 1990s. In 1997,

they bought a toy company only to sell

it a few years later. In 2010, they

bought a different jewelry company that

was sold a few years later. I hope you

can see the pattern here that they not

only wasted a lot of time and money

searching for new directions, they never

really found that new direction. Another

big reason behind the decline has to be

competition coming from so many

different angles. Part of Avon's

earliest success was due to the fact

that it was difficult for people in

remote small towns to physically travel

to a place that would offer many

perfumes or cosmetics. Remember, we are

talking about over a century ago when

Avon representatives would literally use

horses to travel to people's homes.

Clearly, things are going to change a

lot over such a long period of time, but

it shows how different the world was

when Avon was originally built and how

much emerging competition that they have

been forced to face over the years.

Drugstores like Walgreens or CVS have

become popular places to buy cosmetics.

Discount stores like Walmart or Target

have been a major factor and some of the

more recent competition has come from

specialty stores like Ulta and Sephora.

Avon was out there selling cosmetics

before any of them even existed. And as

people have been presented with more

choices, the market has become more

divided and Avon has struggled to

provide much reason for people to buy

their products over everyone else's.

This is going to lead me right into the

next reason behind their decline,

technology. Even as physical retailers

became a common way to buy cosmetics,

Avon remained the most attractive way to

do it from the comfort of your home. The

representative would show up at your

door and show you all of this wonderful

stuff. But I think most of us can agree

that the internet has become the new

most attractive way to buy cosmetics

from your home. So it really seems like

that would have been a logical way for

Avon to evolve. But they mostly missed

that opportunity and continued to rely

on their sales representatives far more

than their website. And looking back

now, it is easy to say that they should

have put way more effort toward online

sales. Not to mention the lack of social

media advertising. those ads that show

up on Instagram or well YouTube can play

a big part in how a brand is perceived

especially by the younger generations.

But for reasons like this, I do not

think that Avon has done a great job in

attracting the younger people. Also in

the category of technology, it is worth

mentioning that Avon spent 4 years and

over $und00 million building a software

system that was supposed to manage

orders and track commissions. But in

2013, the representatives had such a

negative reaction to it after a test run

in Canada that the company gave up on

it. My next reason behind the decline of

Avon is their focus on international

operations. Now, to be clear, Avon has

been struggling throughout many areas

around the world, but in its home

country of the United States is where

things have been the most troubling.

Their first international expansion was

by moving into Canada all the way back

in 1914. In the 1950s when everything

was really taking off they expanded into

South America followed by Europe and

then Japan in the 1960s. In 2006 Avon

was the first company given a license

for direct selling in China after a ban

had been lifted. So as their operations

have declined in the United States more

effort has been put toward these other

countries. By the early 2010s, North

American sales were consistently

declining while they had started

reporting losses in the region each

year. By this time, North America only

accounted for less than 15% of Avon's

total sales. These struggles in North

America were contributing to a major

drop in the company's stock price. $100

invested in Avon in 2010 would have

dropped to $16 by 2015. So then the

company essentially separated its North

American business by splitting into two

parts. The new North American company

was called New Avon. Makes enough sense.

While the existing company from around

the rest of the world was called Avon

Products, Avon Products still owned a

small portion of New Avon, but there

have since been changes in ownership on

both ends. In 2024, Avon Products, the

international one, filed for bankruptcy,

citing external factors like the

pandemic and the war between Russia and

Ukraine as contributing factors. But the

biggest and most immediate factor is a

bunch of talc related lawsuits. So, I'm

going to go ahead and put that as the

next reason behind the decline. I want

to be extra clear that I am not a

scientist or a doctor by any means, but

to my understanding, talc is mined

alongside asbestous, which is a known

carcinogen. Therefore, talc can be

contaminated by asbestous. So, many

people using talc have seemingly

developed major health issues from it.

Unfortunately, many cosmetics companies,

including Avon, have used talc in their

face powders and other products, and

that has led to multiple lawsuits. As of

the bankruptcy, Avon said that they were

dealing with over 380 of them, which,

let's face it, at this point probably

costs more money than the company can

afford. Again, you are really going to

have to do your own research if you want

anything close to a full understanding

about all of this. But it has been bad

for Avon and the most recent setback in

their ongoing decline. For the final

reason on my list, I'm just going to

directly say what I've been hinting at

throughout most of this video, and that

is Avon is outdated. I'm talking about

the name, the methods, and probably most

of the stuff associated with it. This is

one of the oldest brands that I have

ever covered on this channel. Even in

the 1980s, they were struggling to

remain relevant while already

celebrating their 100th anniversary.

Today, I'm guessing that a fair amount

of the people watching this have

probably never even heard of Avon. And

the people who have heard of it probably

do not think of it as a cool trendy

brand. It is sad to see such a

revolutionary once revered company in

such a diminished condition like this.

But at the same time, I would not say it

is unexpected. Almost everything that

once made Avon unique has become

outdated. And of course, they could have

kept up with technology better, changed

their sales tactics, spread into more

promising areas or whatever else. But it

is hard. It is hard to remain relevant

and stay on top of everyone else while

the world around you is constantly

changing. And maybe in the case of Avon,

it wasn't meant to happen. Let me know

in the comments what do you think about

Avon. Is it an old outdated brand

without much uniqueness to offer in

today's world? Or does it still have

potential to make a comeback? And if so,

what does it have to do to make that

happen? This was actually one of the

most upvoted video idea topics on my

website. So that tells me that there is

still interest in the brand. and I don't

know could be taken as a sign of hope.

Also, do you agree with my list of

reasons behind its decline? As always,

it is not a complete list, but rather

the factors that I believe are the most

relevant and interesting. So, let me

know if you think something should be

added or subtracted from it. And any

other thoughts you have about Avon or

anything else in this video, leave them

in the comments. I'd like to hear what

you have to say. Thank you for watching.

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