Amway Taking Back Its Name In Multimillion-Dollar Campaign
The company, which since 1999 has made Quixtar North America its online brand ID--and de facto brand--in this country, is bringing back Amway as the global brand, and eliminating the Quixtar name entirely.
This year, the division of Ada, Mich.-based Alticor will consolidate under Amway Global and will launch what it is calling a multimillion-dollar effort to tout the Amway brand anew with advertising, media and PR efforts telling "a compelling and dynamic story of the business opportunity in North America."
"One of the reasons we are restructuring the brand within the next two years is because the name still resonates strongly with the public and with consumers," says Alticor spokesperson Mike Smith. The current logo, introduced this month, is a bifurcated box with the Quixtar brand on top, and a small Amway Global logo underneath. In September, the brands will be reversed, and in May 2009, Quixtar will be retired, and the logo will be Amway Global.
Robert Passikoff, president and founder of N.Y.-based market research firm Brand Keys, says Amway should, indeed, advertise to speak to the Web-shopping public, and to Amway members.
"They need to advertise because if you look at the sales and distribution process, they have been extraordinarily successful. But if you wanted to replace it overnight, you could do that with the Internet. The 'bionic' consumers of the 21st century go online to get what they want," he says.
"Also, advertising would be the multimillion-dollar version of why the light bulb company advertises in Sports Illustrated: so their sales force can point to the ad," he says, arguing that high-profile advertising builds brand equity and engagement with independent members. "It reinforces the brand."
For many consumers, Amway may have connotations of uncomfortable house parties that turn into sales and marketing confabs and strained friendships. And for some, the Amway name evokes questionable marketing tactics akin to so-called "pyramid schemes."
On the latter point, Amway goes to some length to explain itself on its corporate site, Amway.com. "Some people confuse the Amway business opportunity with disreputable pyramid schemes. However, there are major differences, which have been officially recognized by the U.S. Federal Trade Commission," the company says. It explains that Amway's multilevel "network" marketing is driven by one-to-one sales of quality products, and that entry requires a small refundable entry fee and no minimum order, and that it doesn't pay bonuses for sponsoring another person.
Passikoff says an integrated brand effort is an important job to do precisely because Amway looks, superficially, like a get-rich-quick program, even though it isn't. Just so long as Amway doesn't talk about that in its marketing.
"Yes, the fundamentals of network marketing are that the wider the base gets, the profits get spread among more and more people. But the people who have bought it have bought it on the basis that they are providing quality products," he says.
Amway's line includes vitamins, water purifiers, cosmetics and hair care under brands like Artistry, eSpring, Atmosphere and iCook. Passikoff says the company should focus on assets, not on trumpeting the legitimacy of its sales stratagem. "The issue is that nobody is turning around and saying these products suck," says Passikoff. "The product is fine--the issue is not wasting time with messages you know people won't believe and to a large degree raise issues among people who may not know or care."
David Lam, an IBO for Amway for the past few months says that even though there are, for some, bad connotations with the Amway name, it makes sense to phase out Quixtar. "Usually what I do is, instead of trying to hide the Amway name, which a lot of IBOs do [by using Quixtar instead of Amway] I call it Amway. A lot of people have never even heard of it. There should be one core name."
Alticor posted sales of over $7.1 billion last year--a 12% improvement over 2006. Growth, per the company, came from Amway markets in Europe, Asia, and Latin America.