Direct Marketing -Amway

Direct Marketing.

Presented By:Ajay Rathod 13Nikunj Shah 24

Jayesh Surve 43Sanil Tharval 45Ankita Trivedi 48

Flow of Presentation.

Introduction to Direct Marketing. Introduction to Amway. Amway Business model. Amway’s Advertisement/promotional strategy. New products launched. SWOT Analysis. Future plans Findings and recommendation.

Direct Marketing definedDirect Marketing (DM) is an interactive

system of marketing that: Uses one or more advertising media to effect

a measurable customer response

Or transaction at any location

And stores information about that event in a database.

General Definition of Direct Marketing

Two way communication between customer or prospect and company.

Sometimes called interactive marketing.

No middle man.

Measurable, database always used. Direct marketer is always accountable.

DM: The Key to success!Database used

to capture response (and non response)

Data to be used for future decision making and targeted promotions! Database

Demographic/lifestyle data

Customer contact

data

Transaction data

Database and ROI: Lifetime Value

Database

Analysis

Promotions

ROI

Lifetime value

Convert inquiries

Retain reactive customers

Build loyalty

Find “Like” customers

Cross sell products

Database

Database Usage In Direct Marketing

Direct Marketing Goals Generate new customers at the lowest

possible cost per acquisition.

Maximize customer lifetime value via repeat purchases.

The goals of every direct marketing organization need to be exclusively focused around the above!!!

Direct Marketing CycleList or

database

Target customer

Direct response

promotion

Response and Analysis

Decision making/Resea

rch

Types/kinds of Direct Marketing

Direct Mail.

Internet.

Door to Door

Tele-Marketing.

Tailored Publication.

Net -Work Marketing.

Network Marketing

Facts about Amway Started in US in 1959 with 1 product.

Is now a $8.2 billion Corporation.

The Largest Direct Selling Company.

Currently managed by Chairman Steve Van Andel and President Doug De Vos

Has already notched up a sales turnover of Rs 1,128 crore with a Rs 151-crore investment.

About 85% of the products the company sells in India, are made in India by about 7 third-party contract manufacturers.

600 patents, 450 World Class products.

32000 product training sessions each year.

Facts about Amway-India Commenced business in India from 1998

Globally 450 products but in India we have just 110 products.

Last year, Amway grew over 40 per cent (in India), which is more than any other country where they operate.

Operates in four categories - nutrition, cosmetics, personal care and homecare.

Eastern India contributes around 22 percent of the total sales of the company.

Tamil Nadu, is their largest market. They had done business worth Rs.93.8 crore in Tamil Nadu in 2007 and had paid taxes to the tune of Rs.10.25 crore in the year.

It has 14 offices and six warehouses in the state and carry out home deliveries to 879 pins codes in the state.

AMWAY INDIA – 10 Years 1998-2008

1998 2008

6 Products

5 Offices

1500 pin codes Service

70% Money Back Guarantee

Turnover Rs. 100 Crores

100+ Products

120+ Offices

12000+ Pin Codes

Money Back Guarantee

Turnover Rs. 1000+ Crores

BUILD YOUR OWN EMPIRE

Business model of Amway

Performance Incentives

Amway’s Promotional Strategy

The company has been advertising heavily, quite simply defying the laws of direct selling.

The purpose of their advertisement is to build corporate brand awareness.

Television campaign will run till 2010.

The advertising campaign for 2009 is aimed at increasing awareness. By the time they get into 2010, they plan to look at category-specific or even product- specific advertising,"

Although Amway has been operating in India since 1998, it started advertising only recently.

The focus is more on their nutrition and wellness products.

Traditionally Amway did not advertise.

At present, their advertising budget is Rs 15 crore because the aim is not to create demand but to build awareness and create a market atmosphere conducive for our distributors."

New Products Launched In April 2008, they entered in to mass market segment

with launch of "Great Value Product Range”

In Nov. 2008 Amway Lunched two energy products –

Amway XL energy drinks Which comes in two flavours of citrus blast and tropical blast.

Amway XL energy bars. Bars are available in apple cinnamon and fruit and nut flavours.

New products would be manufactured near Kullu, in Himachal Pradesh

Amway XL energy drink has no carbohydrates, no sugar, no fat and marginal caffeine and it is a quick healthy solution to do away with fatigue and stress.

• Distribution N/w

• Quality Products

• Provides opportu-nities for building business

• Lack of awareness

• Product specific ads

• Focus on variety of

• products

• Competitors like P&G, Avon, Hindustan Lever

• Repetitive Sales

• Expand distributors base

Strengths Weakness

ThreatsOpportunities

Amway’s Future Plans Planning to expand its distributor base in next 10 years to 9

lakh personnel.

Plans to add about 100,000 direct sellers.

Nearly 60% of Direct Sellers stay with the Company.

Increase the number of its offices to 300 from the existing 127.

Amway's focus is on improving the consumer access and the first step towards online sales by revamping its website.

New Website of Amway India

24x7 Web ordering facility

Findings And RecommendationsFINDINGS

Distribution N/w

Quality Products

Repetitive Sales

RECOMMENDATIONS

Lack of awareness

Product specific Ads

Lack of Core products

CONCLUSION

THANK YOU!!