The cosmetics giant designated extensive resources and fanfare to its fledgling Avon Future division and the Mark brand hailed as Avon's answer to luring the 16-to-24 set to an older-skewing brand. But industry observers agree that the $108 million in retail sales for Mark's first 18 months (which translates to roughly $65 million in revenue) falls far short of the $100 million Mark was projected to hit in its first year.
The departure of Avon Future President Deborah Fine, who signed on last month as the new CEO of Limited Brands' youthful Pink division of Victoria Secret and has yet to be replaced, is likely a sign that Mark's trajectory has not been as successful as planned. Now it's up to Doug Zarkin, director-consumer marketing and creative services for Mark, to prove Avon can attract a new generation of both buyers and sales representatives-and he's employing new products, advertising and a slew of youth-enticing partnerships to do that.
Carrie Bonner, industry manager-consumer products for Kline & Co., said Mark has certainly fallen below expectations. "The younger customer isn't typically an Avon customer and it's a challenge to reach them," she said. However, Avon's future success demands that, whether with Mark or something else, "they need to find a way to reach young audiences in a big way long-term."
`the next generation'
There's a lot at stake. The company in 2003 ranked No. 8 in the U.S. cosmetics and toiletries category with sales of roughly $1.2 billion, Ms. Bonner said. And 2004 sales, while healthy overseas, certainly didn't raise Avon's ranking in the U.S., where the company said recently it expects to see continued declines throughout 2005.
Mr. Zarkin, 34, had spent 12 years in the ad agency business before joining Avon in 2001, six months after Ms. Fine came on board, to "develop the next generation of Avon buyers and, most importantly, sellers," he said, referring to Avon's direct-to-home sales force.
He has sought to draw in young buyers-and sellers-with a portfolio of products now totaling roughly 370 items with a youthful spirit down to their jeans-pocket-friendly packaging and quirky names like Hook Ups. He helped develop an introductory teaser campaign from director Wes Anderson and integrated the brand into the plot line of NBC's soap "Passions." He engineered a range of partnerships with marketers from Nextel to Ford Motor Co., designed to offer free phones and even car leases as enticements for young sales reps.
Mark now boasts 20,000 reps (compared to 660,000 reps for the overall Avon line), but clearly that's not enough. The plan now, Mr. Zarkin said, is to tap into the wide universe of 17.5 million women between 16 and 24 by showing the tangible benefits young women get from selling Mark-such as buying a pair of Manolo Blahniks or paying for spring break. The simple message is that "Mark is the makeup you can buy and sell."
A $10 million TV and print effort breaks this week on networks such as the WB and MTV and in publications such as Conde Nast's Allure and Hearst's Cosmo featuring vignettes depicting how real-life young reps have been able to "make money for schools, shopping, whatever." The ads quip, "How does nail polish take you to new places? How can eye shadow expand your shoe collection? How can foundation furnish your apartment?" The answer to all those questions, of course, is by selling Mark.
Jeanine Recckio, beauty futurologist at the Mirror Mirror Imagination Group, said tapping into young women's growing entrepreneurial spirit is a great concept. But some industry observers note that many of the current Mark reps are actually just daughters of Avon reps whose sales are largely being handled by Mom.
Reaching out to a new audience of young women is not going to be achieved solely with straight media buys. In fact those are "just the beginning," said Mr. Zarkin, who has tried from his start at Avon to turn every media dollar into far-reaching partnerships (with the help of media buying and planning agency Wieden & Kennedy, New York; Avon handles creative largely in-house).
A recent ad buy during the WB's "One Tree Hill," for example, has been parlayed into Mark's presenting sponsorship of the series' upcoming 23-city music tour as well as inclusion of Mark into the show's storyline in April.
In addition to drawing in new reps, Mark must also increase the average sale of each rep and that, Mr. Zarkin said, will be achieved largely by increasing product offerings. Mark will soon introduce hair care, further press into men's products and likely enter into the sun-care category as well as launching new colors and shades for existing products, such as the click-together Hook Ups combinations.
The challenge will not be an easy one. As one beauty analyst put it, "I don't think the Street is staying up at night wondering what's happening at Mark. If it doesn't do any better, I won't be surprised if it gets folded into the base business."
Mr. Zarkin, though, is bullish on what he refers to as the Mark "movement," offering that Avon is committed to continuing Mark as a standalone business in the wake of Ms. Fine's departure. The success of the brand, he said, has been its wholly incremental addition to Avon revenues. He argues that it took Avon 118 years to cull its hundreds of thousands of reps. But Avon can't wait that long to tap into new audiences.