Is Avon a Scam? (A Pyramid Scheme Or What)

“I tried it, I like it, I recommend it!” Is this what you hear from people selling Avon products? Some believe they’re a pyramid scheme. I thought they were a scam. BUT did you know they’re STILL going strong? Is it going to keep surviving or what?

Avon is like a household name. It’s been around since 1886. Quite impressive don’t you think?

You might have heard your Grandmother or Mother talk about how they used to knock on doors and be excited about showing Avon products.

I can tell you Avon is ALIVE! The real question, is the quality really there in their products and services and can you make a decent amount of money?

I had to find out why they managed to survive so long and will they continue to do so.

First, let me commend you for doing your research here. It’s the only way to keep yourself from being scammed and find legitimate ways to earn passive income online.

I’m not here to sell you on Avon, in fact, I am not associated with them.

I research lots of products and write reviews on them to help you make informed decisions.

Let’s go over my findings of Avon…

What Is Avon?

Who hasn’t heard of Avon? Like I mentioned earlier they’re like a household name.

According to Infinite MLM Software.com, Avon is ranked #2 based on its yearly revenue of 5.72 billion dollars for 2018.  Amway is ranked #1.

Did you know Amway has over 6.5 million members worldwide? That’s because they sell their products in over 100 countries.

Avon is an MLM (multi-level marketing) company that sells beauty, jewelry, skincare, and household products.

The other products they carry are fragrances, fashion, and hair care products.

Avon offers you the opportunity to go into business as a representative and sell their products and make money off the sales of the people you recruit.

The product sales and recruiting are done face to face and on your personalized website, Avon gives you.

About The Founder

Avon is one of the oldest MLM company in the world.

Some interesting facts about the founder…

David H. McConnell started as a travelling book salesman. In order to get his sales, he would gift out beauty products like perfume. It turned out his customers were more interested in free perfume than books.

So in 1886, David created Avon in New York, USA and his first product was perfume. Imagine that!

It was actually called California Perfume Company (CPC) and in 1939, renamed to Avon. They went public in 1946 and listed in 1964 on the New York Stock Exchange.

The current CEO is Jan Zijderveld.

Inside Avon – The Products

Avon’s products range from beauty, household, and personal care and are broken down into the following categories:

• Makeup
• Skincare
• Bath and body
• Fragrance
• Jewelry
• Fashion
• Wellness
• Home
• Men
• Outlet (discounted items)

Some of the products they manufacture themselves, the rest are by third-party companies.

Do The Products Really Measure Up?

There are many people who have sensitive skin. I happen to be one of them. Even fragrances can be quite repelling and skin allergies from using skincare products are certainly not fun either.

Some people break out with redness and itchy patches on their face and hands.

So because of that, I did some research to find out how customers were enjoying their user experiences with their Avon products.

Consumer Affairs Testimonials

BBB Testimonials

As you can see there are negative testimonials on their products. I did see a lot of complaints about Avon’s services.

What are your user experiences with Avon products?

How To Make Money With Avon

From what I can see, there is no fee to join for 2019.

Avon is typical of MLM, in that there are 2 ways to earn an income:

1. Become a representative and sell the products to your family, friends, and neighbours and earn a certain percentage on your sales.

• Become an Avon Representative and earn commissions on your sale of products and make commissions on the sales made by your recruiters.

Making money with Avon boils down to you selling the products and recruiting people.

How To Get Started With Avon

To become an Avon Representative, you have a choice of 3 starter kits (shipping and handling charges are included in the prices).

Quick Starter Kit ($25 with a value of $80)

• 4 full-size products
• 4 travel size products
• 20 samples
• Order forms
• Brochures
• Sales information
• Personalized website

Advanced Starter Kit ($50 with a value of $140)

• Everything from the Quick Starter Kit
• 30 brochures
• 3 more full-size products
• 3 more travel size products
• 15 additional samples

Premium Starter Kit ($100 with a value of $400)

• Everything from the Advanced Starter Kit
• 20 full-size products
• 2 minis
• 50 samples

What I don’t see in all 3 Starter Kits, is there are no catalogues. Having been involved with an MLM skincare company as a representative, I found the catalogues are expensive.

Hopefully, Avon included a few of their catalogues in the Starter Kits. Your guests will be asking for them.

NOTE: It’s easy to give catalogues away but it’s not a guarantee of a sale.

Once you use up your inventory of marketing materials and samples from whichever size of starter kit you started with, there is a cost of course to order them.

For this, they charge you their Avon One Simple Fee for each campaign of $5.95 and up fee which covers shipping, handling of your orders from your personalized website.

The terminology of Campaign – This is the 2 week selling period for each Representative. Based on a calendar year, Avon has 26 campaigns (selling period).

Avon’s Compensation Plan

The more products you sell and the sales from your team determines your commission percentage.

Looking at Avon’s Compensation Plan, it’s straightforward and “decent” compared to a lot of other plans I’ve seen.

I’ll go over a bit of how you will be compensated for your efforts…

Representative Commissions:

When you sell products to customers, you make money. When your team sells products, they make money and so do you.

The Campaign Sales are based on your personal orders and purchases made by your customers so as your sales $ increases so does your commissions.

Also, note that the commissions vary according to the product category you sell from.

Sponsoring Others (Qualified New Recruit Bonus)

For recruiting new Representatives and training and mentoring them, Avon rewards you.

For every person you recruit and they pay for their order of $150 or more within your first 2 campaigns (1 month), you receive a $20 cash bonus.

If you recruit anyone with your first 7 campaigns, your bonus in $50 for each recruit.

You can make additional bonuses based on your new Representative’s sales.

Sponsor Bonus

 

Earn 3% sponsoring bonuses on all of your Representatives personal sales when you sell $50 or more in a campaign.

You may also earn additional bonuses on any of those sales.

Promotion Bonus (Team Building)

When you advance to a new title, Avon rewards you with their one-time Promotion Bonus and that amount goes up each time you are promoted with another new title.

For instance, let’s say you are promoted to Ambassador Bronze and this is your first time to this title, Avon will pay you $1,500 as a Promotion Bonus.

A Catch: You will not receive this $1,500 in one payment. This Promotion Bonus of $1,500 is paid in 4 installments of $375 each time you keep your title of Ambassador Bronze.

Generation Bonus

If you’re here, a huge Congratulations to you!!

Once you’re promoted to a Star Promoter, you can earn bonuses on your Generations.  Your percentage is based on your performance and the number of generations you built.

You can also earn additional bonuses.

Take a look at Avon’s entire 2019 Compensation Plan. CLICK HERE to see the PDF. 

I have also included a video of the Compensation Plan dated September 29, 2013. Unfortunately, I was not able to find a more current one but it will still give you an idea of how the plan works.

 

What I Like About Avon

#1. In Business A Long Time

Avon has been in business for over 130 years. It was established in 1886. If it was a scam, I can tell you this company would have disappeared years ago.

Can you imagine what it endured over those years? World 1 and 2 and of course there was the Great Depression.

The history is incredible!

#2. Affordable Starter Kits

At $25, $50, or $100, whichever Starter Kit you choose, the prices are affordable AND you get a lot of products in each kit, enough to get you going and make sales.

#3. Support For Women

Avon contributes to a variety of charity programs like Breast Cancer and Violence Against Women and Girls.

#4. Personalized Website

Avon gives you your own personalized website that resides on their sub-domain. Your customers and visitors can make product purchases and even signup to be on your team via your site.

What I Don’t Like About Avon

#1. A Long Time To Get To Higher Levels

If you look at the Compensation Plan, in my opinion, I think it’s going to take you a long time to get to Avon’s higher levels.

You’re dependant on your sales and how well your team grows. 

Avon’s plan is no different than other MLM plans. It’s just plain difficult to get promoted to higher levels. You’re going to have to really work hard in recruiting people and pushing your team to work harder if you want to get to the top.

Because Avon has been around for years, you could run into people who are already a representative of Avon or meet an ex-rep who wants nothing to do with the company.

#2. Extra Costs

One of the things I realized when I was doing MLM for a skincare company, was my additional costs for marketing materials.

To make sales, it’s important to treat your tie with Avon as a real business. This is how you earn your trust with the people you want to recruit and so this means being professional.

Your main costs here will be brochures and catalogues because of the coloured ink and thicker paper. Your other costs will be business cards which you can get printed locally. Don’t forget too you still need to order samples and that cost will add up quickly.

You might even consider sending emails out to your interested parties and customers so rather than do it manually, there will be a cost to do email marketing using an autoresponder like Aweber (30-day FREE trial).

#3. Earnings Are Small

I did a lot of research on the internet and was unable to find a current Income Disclosure Statement.

I managed to find Avon’s  2015  Annual Report (140 pages) made available to the public. Rather than get into details, here is a summary:

NOTE: For whatever reason, the 2015 Avon Annual Report PDF is no longer on the internet.

You can see Avon’s revenue is an impressive $6.1 billion. Out of the 6 million Representatives, the maximum average earning is $1, 026.75 for 2015. I’m assuming the average is based on the Reps achieving their maximum 50%.

If you do the math, $1,026.75 / 12 months = $85.56. That’s an earning of $85.56 a month. Yikes!

I really don’t think it’s worth your time and hard work to be a Representative of Avon. You can’t live on that.

Anyway, let’s look at what the incentives paid in 2015 to Avon’s Reps.

According to that same annual report, each Representative who qualified to earn the Leadership Bonus only received an average of $590.53.

This comes to $590.53 / 12 months = $49.21 a month.

The overall picture of an individual Representative earning the maximum 50% commission and the leadership bonus is $85.56 + $49.21 = $134.77 a month average. Terrible, right?

So what about the Representatives who were under the 50% commission bracket? They lost money too. This didn’t even cover their inventory costs and phone bills, fuel, etc. and all the time and effort they put in.

NOTE: I left the math part to the end so that the results will be a reality to you.

Is Avon A Scam?

Avon is not a scam. It is not a pyramid scheme!

The company has been around for over 130 years and are all over the world. They are extremely passionate about helping women and men make a future for themselves.

They’re definitely a legitimate business. There is no perfect company and there are always stories from both sides whenever conflicts arise. I would have to say that the retail customer is always right.

From what I can see, Avon does give a lot of support to their Representatives. They are given their own personalized website and control to operate their business.

The unfortunate part is a lot of the Representatives seem to be losing money. Even Avon made reference in their 2015 annual report about experiencing high Representative turn-overs. 

The reason I do not recommend Avon to you is that the Representatives are not making money. 

Want To See How People Are Really Making Money?

The business model I’m recommending to you is Affiliate Marketing. It is my #1 Recommendation.

There are many reasons why I say this:

• You’re not chasing after people trying to recruit them. Instead, people come to you.
• You have no inventory
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Hey Folks,

Thank you for reading my review of Avon. I hope I was able to give helpful information to you.

Are you a member or ex-member of Avon? What are your experiences with Avon as a customer or as a Representative?

If you have any questions or comments, it would be awesome to hear from you.

Monica