In Latest Twist, Avon -- The Original D2C Brand -- Finds New Relevance

It’s a good bet that if many D2C marketers ever thought of Avon, it was just as a dusty brand that may have meant something to their mothers.

They’d be at least a little right. The company was way too slow to move into ecommerce, and struggled for years before being broken apart back in 2015, with the global Avon Products business moving to London and the much smaller U.S. component taken over by private investors.

But the recent news that Natura & Co, a Brazilian beauty company, is acquiring Avon, got me thinking about the original meaning of direct, and why it matters more than ever.

For one thing, Avon may have started back in 1886, but it paved the way for generations of direct beauty sales. Its basic insight remain relevant today: cosmetics counters aren’t always the best way to sell beauty products, and many women prefer to shop at home.

After Avon, there was Mary Kay. Then the direct-through-infomercial model got new legs in the digital age, with brands like Proactiv. And the multi-level-marketing sales fleet has been reinvented again, by companies like skincare firm Rodan + Fields.

The Avon deal itself is huge. Euromonitor International says the acquisition will boost Natura & Co to be the 9th largest beauty company, closely following Beiersdorf AG.

I have a nostalgic fondness for Avon, but only because I remember visiting my grandmother, who lived in rural northern Michigan, and driving for miles to pick up her orders from a friend, another farmer’s wife. Besides the usual items -- bright lipsticks and pale nail polishes -- there were always those weird products, like jewelry and little statues filled with solid perfume.

But I never made a personal connection to Avon. By the time I was getting serious about makeup, the world was full of easily accessed retail brands, from the ultra-affordable to the high-end. And once ecommerce (not to mention Sephora) became part of my world, gloss from a company like Avon would never have crossed my lips.

I sometimes wrote about Avon, and once did its three-day cancer walk to support a friend. But I couldn’t imagine anything less direct than dealing with a rep, then waiting for the order.

What’s exciting about the Natura deal is that it will work because much of the world still lives like my grandmother, with less access to retail locations and more of a craving to make a beauty buy part of a bonding visit with friends. And millions of women still have the dream of making a living the Avon way, setting their own hours while earning a living.

While Natura knows plenty about brick-and-mortar retail -- it owns the Body Shop and bought high-end Aesop back in 2013 -- it also knows that in Brazil, Avon’s biggest market, consumers favor the direct-selling model and third-party reps. In fact, many of these reps already sell both the Body Shop and Aesop products.

Euromonitor speculates that Natura’s retail experience could lead to Avon eventually exploring “bricks and mortar to offset some of its losses from the slowdown in the direct-selling channel.” It also thinks Avon will benefit from Natura’s reputation for natural and ethical products “to bring it in line with competitors and to the baseline of what today’s beauty consumer expects from the formulation of their beauty products.”

The merger balances out global imbalances, Euromonitor writes, improving Natura’s position in territories like Russia and the Middle East, where Avon is strong, and leaveing the company well positioned to move its direct model into China and the Philippines. It solidifies Natura’s lead in Brazil and strengthens its hand throughout Latin America and Mexico.

There isn’t a lot of good news about Avon in the U.S. Cerberus, the private equity investor that bought Avon North American for $170 million back in 2015, last month announced it had sold Avon for $125 million to LG, the Korean conglomerate.

But around the world, the deal proves old-fashioned direct selling still has legs. And for modern D2C marketers, there are lessons: Never underestimate the power of a transaction that bypasses regular retail and makes people feel great about the people who close the deal.

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