Amway's Indian Network Marketing Experience
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Details
Themes : Direct Marketing
Period : 1994-2000
Organization : Amway Indian, Eureka Forbes
Pub Date : 2001
Countries : India
Industry : Business Services & Equipment
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Case Code : MKTG003
Case Length : 9 Pages
Price: Rs. 300;
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Picking Up the Pieces Contd...
The most significant of Amway's Indian initiatives were its 'Indianisation' efforts. The company started printing Hindi slogan 'Hamara apna business' (our own business) on its stationery. The company's first product line, Persona, was created specially for the Indian consumers. Amway even named its expansion drives as 'Operation Gaadi' and 'Operation Ghar.'
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Operation Gaadi was launched in east-Uttar Pradesh where a store was mounted on a truck and made trips to different regions on different days. The project was later extended to West Bengal as well. Operation Ghar was primarily designed to provide better service to the customers as well as to its large family of distributors. Involving an outlay of Rs 15 crore in its Phase I, Operation Ghar eventually covered 19 state capitals. Operation Ghar was designed to provide five Es - ease of ordering, ease of paying, ease of receiving, ease of returning and ease of information/operations. Amway also utilized the Internet and electronic kiosks to hook up with its distributors and give them information. 'Network'ing its Way into the FutureBy 2004, Amway planned to become a Rs 1000 crore company with a physical presence in 198 centers across India. The company also revealed that by 2002, it would be selling all the 450 Amway products that were available abroad, in India. |
As part of its plans to tap unexplored markets, Amway announced an ambitious expansion of its distribution infrastructure in Andhra Pradesh, which included setting up a warehouse. Once the marketing business in urban areas was strengthened, Amway planned to turn tis attention to untapped rural areas as well. Even as Amway was establishing its roots in India, it was already facing troubles abroad.
The very concept of network marketing was being threatened by the growing popularity of e-commerce and the Internet. Through the World Wide Web, manufacturers had the opportunity of engaging in one-on-one direct selling in an even simpler way. This posed a major threat to multilevel marketers. However, the real threat seemed to be the merging of telecom networks with the cable television operators.
This brought the customer directly in touch with the company through telemarketing tools. This would naturally make the salesperson obsolete. Ofcourse, given the pace of developments on the Indian telecommunications front, network marketers could take it easy for least some more years. However, Amway prepared to meet these challenges by taking initiatives to further strengthen its online presence.
With Internet usage levels increasing and little spare time for shopping, Amway believed that the Indians would gradually move to online shopping. But it thought the process would take time, as het pleasure of window-shopping and the actual shopping experience could not be replaced very easily. Amway provided graphics and three-dimensional views in the product display sections on its website. The company also planned to have portals in various Indian languages to ensure wide coverage.