Angela Cretu … how Avon’s new CEO is transforming the business in the midst of pandemic … creating a new digital platform and business model

I first met Avon’s new CEO, Angela Cretu, during a customer-centricity masterclass I was delivering in Budapest a decade ago. As we talked about the primacy of the consumer, and how to create better propositions for them, she was adamant that in her business it was the network of self-employed sales representatives who were most important, and the proposition to them.

For years, Avon has stood out for its distinctive business model. It’s network-based model of peer to peer sales has thrived, selling to friends and neighbours within local communities, inspired by Avon’s support in “empowering women” to achieve independence, success and personal wealth. It also thrives on representatives recruiting their own local teams of representatives, with those at the top of “pyramids” able to potentially make millions.

However all of that changed with Covid-19. For years, despite declining sales and increasing competition from a new breed of direct and community-based beauty brands like Glossier and Beauty Pie, Avon had resisted a shift to digital. As competitors embraced natural ingredients and new business models, Avon clung to its old model of success.

Cretu, a 45 year old Romanian who has been with Avon for 22 years, took on the top job after the company was acquired by Brazil’s Natura for $2 billion last year, (Avon rejected offers of $10 billion back in 2012). The Sao Paulo-based company, led by Roberto Marques, has also acquired Body Shop and Aesop in recent times, restyling itself as Natura & Co.

Within weeks of starting her new role, one of Avon’s few growth markets, China, was locked down. Other key markets like Spain and Italy quickly followed. Cretu’s first response was to her 5 million self-employed sales representatives, providing masks and safety guidance. But the business was in deep trouble, unless it changed quickly.

“It was a wake-up call to our business” she says, “Everybody came together in ways I could never have dreamt of. This spirit has accelerated the appetite for people to change and adopt new ways to work almost overnight”.

A new digital sales platform was rolled out within 8 weeks, giving representatives new digital tools to build their own websites within the Avon ecosystem, migrate their contact databases, and establish new forms of relationships with consumers. Avon reconfigured its logistics to offer deliveries direct to consumers, once ordered through representatives.

“We have learnt that we have to stop acting in a hierarchical corporate way and start acting like a network of professionals, empowering one another, making fast decisions” she says.

? Peter Fisk 2020

Peter Fisk is a leading business thinker, bestselling author and inspiring speaker, whose career was forged in a superconductivity lab, accelerated by managing supersonic brands, shaped in corporate development, evolved in a digital start-up, and formalised as CEO of the world’s largest marketing network. 

He now leads GeniusWorks, a business future accelerator in London. He is also Thinkers50 Global Director, founder of the European Business Forum, and a professor of leadership, strategy and innovation at IE Business School in Madrid, where he leads their flagship executive programs.

He has 30 years of practical business experience, working with business leaders in over 300 companies and 55 countries, from Adidas and American Express, Bosch to BNP Paribas, Cartier and Coca Cola, McKinsey to Microsoft, P&G and Pfizer, Virgin to Visa. His distinctive approach is future back and outside in, fusing insights with inspiration, creating innovative strategies to accelerate growth

His 8 books in 35 languages fuse the brains of Einstein and Picasso, explore the creativity of da Vinci, reframe sustainability for innovation, and explore the world’s most innovative companies. His most recent book was “Gamechangers” which will be followed by “Business Recoded” to be published in 2020.

Find out more at www.theGeniusWorks.com or email [email protected]

More from Peter Fisk:

• The Great Reset ... Have the courage to imagine a better world. Why the Covid-19 pandemic is a unique opportunity to build back better.
• How do you see the future? Future Recoded … Reimagine markets. Reimagine work. Reimagine business. Reimagine success.
• Why innovate in a downturn? Whilst everyone else is losing their heads, the companies of tomorrow are being created right now 
• What are the impacts of COVID-19? What business leaders should do now, to support people and society, and secure their business future.
• The Big Pivot ... How are companies adapting to survive and thrive in crazy times of Covid-19 and downturn
• The latest edition of my “Fast Leader” magazine … Humanising the future of business; exploring Ecosystems Inc and systems thinking; the "Survive and Thrive" framework to help you "build back better".