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Amway India: Donning the war paint

Saumya Prakash 

Amway India, a wholly-owned subsidiary of $10.9 billion Amway Corporation, USA, is looking to beef up its presence in India. The idea, says the company, is to take India among the top three markets in the world for Amway by 2020. A key pillar of its growth strategy is the home care segment which operates under “Amway Home”. It has just announced a new brand identity for this segment. The new slogan ‘Powerfully Green for a Safer Clean’ is in line with the company’s aim to seen as a company that follows environmental-friendly business practices.

“The new brand identity for Amway reinforces our commitment to provide the highest product quality standards without compromising our planet’s resources — whether in terms of carbon or water footprint,” says William S Pinckney, MD and CEO,

Amway India, which had a turnover of Rs 2,130 crore in FY 2011, hopes to achieve the target of Rs 2,500 crore in overall turnover in 2012. Amway Home currently contributes as much as 7 per cent of the company’s revenues in India. Among others, offers over 130 products in five categories — personal care, home care, nutrition and wellness, cosmetics and another range that comes under ‘great value products’.

The other aspect of its growth plan rests on beefing up its nutrition and beauty care portfolio. To this end the company has announced its plan of setting up a manufacturing facility at an investment of Rs 400 crore. Currently, more than 95 per cent of the products sold in India by Amway are manufactured by seven different third-party contract manufacturers in the country. While the new plant is expected to be operational in two years, the company hasn’t said anything about its location.

For the records, the company has trebled its production capacities in the leading vendor facility at Baddi in Himachal Pradesh by commissioning four new production lines at an investment of Rs 55 crore.

Amway has also introduced new formulations for some of its home care products for laundry, surfaces and dishwashing, priced between Rs 279 and Rs 715.

Amway says advertising and communication will play a key role in its growth, given the nature of the category. “Even after dealing with concept of direct selling for about 14 years now, people are still learning and educating themselves on the benefits and the value of the direct selling business model. Some of the issues facing the industry are more perceptual in nature, and therefore it is incumbent on us to educate all our stakeholders and key opinion leaders,” says Pinckney. The other challenge that the industry has faced is the absence of a proper institutional structure for regulating the direct selling industry, he adds.

The company will use both mass media advertising and below the line activities to spread the message. There are two television commercials — one for the parent brand and the other for Nutrilite, its flagship brand, which contributes nearly 55-60 per cent to its revenue — on air. Interestingly, Amway is not active on the digital and social media yet.

First Published: Mon, July 23 2012. 00:40 IST