Corporate Sales: $6.2 billion
Beauty Sales: $4.6 billion
Key Personnel: Sheri McCoy, chief executive officer; James S. Scully, executive vice president, COO and CFO; Fernando J. Acosta, executive vice president, chief marketing and social selling officer; Nilesh Patel, senior vice president and president, Asia Pacific.
Major Products/Brands: Skin Care, Color Cosmetics, Personal Care, Hair Care and Fragrance brands including Anew, Anew Clinical, Anew Genics, Anew Men, Skin So Soft, Mark, Moisture Therapy, Avon Naturals, Clearskin Professional, Avon Solutions, and Footworks.
New Products: Anew—Skinvincible Day lotion, Anew Clean Illuminating Rich cleansing foam; Avon—Senses Ocean Refreshing Blue shower gel, body lotion and body spray, SuperExtend Winged Out Mascara, Ultra Color Indulgence Lipstick; Fragrances—Fergie Outspoken Party!, Attraction (men and women), Luck La Vie EDP, Prima, Dreams; Mark—Hawaii Five Oh! eyeshadow, Sunset Glow face bronzer.
Comments: Following another disappointing fiscal year, Avon pulled the trigger and pushed the reset button to kick off its fiscal 2015 charting of a “new path” developed to help the company grow its North American business and international markets, according to CEO Sheri McCoy. The solution was a strategic partnership with a significant $180 million capital investment from Cerberus Capital Management LP that effectively split and restructured Avon’s North American Business into two companies.
New Avon LLC is majority-owned (80%) and managed by Cerberus. Cerberus also invested $435 million in Avon Products, Inc. in exchange for an ownership interest of approximately 16.6%. Scott White joined New Avon as chief executive officer in April, and is charged with leading the transformation of the North American business.
Beyond the restructuring, McCoy reported growth in Avon’s foundational categories. “Beauty grew 3% for the year driven by 7% growth in Fragrance and 1% growth in Color,” she said. “Skin care was flat but would have grown low single digits with the exclusion of the divestiture of Liz Earle.”
A team of research scientists from the Avon Skincare Institute (ASI) presented a new breakthrough in anti-aging skin care at last year’s summer conference of The American Academy of Dermatology.
News of Note in 2016
In 2016 Avon celebrates an extraordinary 130 years in business. The company launched a special website dedicated to the anniversary: www.beautyforapurpose.avon.com. In addition to retelling the company’s humble origins and reaffirming the company’s long-standing commitment that empowers women “to be the CEOs of their own business and control their economic destinies,” the site also includes an excellent retrospective spotlighting the packaging that captured customer curiosity and beauty sales throughout the company’s history.
In April, Avon announced a global partnership with designer Kenzo Takada who, in addition to being celebrated for his fashion designs, is also renowned for his top-selling fragrances that bring together the best elements from both the East and the West. The initial fruits of the partnership focused on the launch of Avon LIFE By Kenzo Takada, a new fragrance line that includes a scent for men and a scent for women set to launch later in 2016.
According to data from S&P Global Market Intelligence, shares of Avon Products rose 40% in the month of August 2016 thanks to a boost from higher than projected earnings. Investors indicate this momentum may indicate a renewed sense of confidence in the company which would be a great thing, given all of the struggles it has worked hard on to put in the rearview mirror.