Tuesday, August 9, 2011
I’ve always avoided vintage Avon perfumes because I’ve read that they have a pretty good chance of having “turned” over the years. So when I received a partial bottle of “Unforgettable” in parfum strength from a generous pal, I didn’t even try it for a while.
When I did, I was soundly impressed.
“Unforgettable,” released in 1960, is an old fashioned everything's-in-it perfume. Heavily floral -- I detect some orange blossom/amber, which reminds me of the old Bal a Versailles and of vintage Givenchy “Organza Indecence” -- it dries down with a chypre-like pinch. There is not very much information available about it. According to Angela of "Now Smell This," a call to the company revealed that their internal database had been cleared of references to it. My bottle, obviously old and well-used, has a simple rectangular shape and a dented metal cap that looks like the family dog mistook it for a chew toy. What amazes me is that the perfume still smells so good. Dated, but good.
Researching this scent piqued my curiosity about the Avon company in general. As it turns out, the fond memory of well-dressed Avon Ladies ringing suburban doorbells is dated, too. In 2005, Avon Products Inc. went to a business model based on Multi Level Marketing, usually called "MLM." In 2009, Avon admitted in a report to the SEC that the company uses income gained through recruitment as a countermeasure to reduced product sales -- in other words, MLM.
I could bore you to death with reports and Federal Trade Commission documents and letters touting both sides -- all of which I’ve looked at -- but I’ll try not to. (References appear at the end of this post.) In recent years, the revenue from Avon’s actual sales has declined, while the number of sales representatives has greatly increased. This is pretty simple math. And the Great Big Hope of American manufacturers in these times, China, has passed firm anti-MLM restrictions, as its government believes MLMs to be “inherently fraudulent.” These are so restrictive that several Avon executives were investigated under the auspices of the U.S. Foreign Corrupt Practices Act.
To be fair, the company claims some important differences from the classic MLM pyramid model. These include training the recruits, prohibiting newbies from recruiting until they reach a certain level of sales, requiring no startup inventory, and providing support via national advertising and biweekly catalogs. My research revealed two selling paradigms -- the “Single” level direct selling, where reps start out (and may stay if they want to) and the MLM structure, in which they are encouraged to recruit friends, relatives, co-workers, then compensated with a percentage of their sales -- you know this drill.
I know it well. I’ve been acquainted with several people and talked to many more who got caught up in MLM and ended up with garages full of soap and/or supplements. My guess is that Avon probably begins pushing recruits toward the MLM model pretty quickly after they sign up, because recruiting is the real goal. This is because the real product -- true for all MLMs -- is stars-in-the-eyes hope. The reality is that most MLM recruits don’t do very well, once they run out of friends, acquaintances and co-workers. When they realize that the actual job involves selling to and recruiting strangers, they often quit.
In the early 2000’s, the Federal Trade Commission proposed a rule (R511993) which would limit the activities of MLM’s. The details included disclosure statements, to be provided to new recruits during a mandated 7-day waiting period; records of cancellations within two years of signup and an earnings claim statement to potential recruits.
Predictably, the fireworks of protest from MLMs came thick and fast, sometimes in the form of lawyerly documents. I found one from an attorney representing Avon to the FTC. It’s pages and pages (and pages) of attorney-speak, definitions and redefinitions, lists of Avon activities that purportedly don’t fit the MLM mold, and suggestions on how the FTC might want to amend the ruling. These involved exempting public companies from the new rule, exempting companies belonging to the industry trade group Direct Selling Association -- now, there’s some twisted logic -- deleting the waiting period, defining a threshold investment amount and on and on and on.
When I visualize a co-worker or acquaintance coming at me with that everything's-great smile, inviting me to some event I know is an excuse for an MLM pitch, I shudder. I have to admit that I’m horrified at the idea of viewing friends as potential recruits, especially since most people fail at MLM selling. The cultlike culture of MLM tends to draw people without much to lose.
It seems that Avon has turned, to this questionable way of doing business.
So, when you see bottles of Avon perfume at the next garage or estate sale, remember what they once meant -- opportunity for entrepreneurial women. Like most things in business, it's all different now.
The photo is from a vintage advertising catalog showing a model holding one of (many) variations of the “Unforgettable” bottle. Others were swans, a snail, a lay-down bottle with a turbanlike cap and a candlestick, and probably many more.
Information on product sales vs. recruitment came primarily from the this website and from my work as a consumer counselor.
The lawyerly protest letter can be found here.