COVID-19 Impact on Avon, H2 2020 Update

Summary

COVID-19 Impact on Avon, H2 2020 Update key findings as of August 24th, 2020 based on market analysis and brand diversification by industry and geography.

Avon may witness a moderate decline in its overall brand sales due to the rapid progression of disease in countries such as Brazil, Peru, and Chile. However, the product diversity offered by the company may help in mitigating the overall losses incurred. The demand for personal hygiene products is growing across the globe, unlike make-up and fragrances. The company needs to update its strategies to minimize the loss of brand sales with innovative launches in the personal hygiene sector. In addition, the company should launch various discount offers across other products in its portfolio to attract consumers.

Scope

• Avon's presence in Eastern Europe may offer some level of resilience against the impact of COVID-19 on brand sales
• Avon has made its R&D, sourcing, and supply chain more efficient to counter the impact of COVID-19
• Avon's overall brand sales look highly vulnerable due to its dependency on Brazil
• Avon should focus on personal hygiene products to alleviate losses in beauty care
• Owing to economic uncertainty, Avon's fragrances business is expected to witness a significant decline
• Avon's 2020 sales are expected to decline at the highest rate of 22.1% among these peers - Coty and Shiseido Co.

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