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Amway Case Study Analysis

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Amway case study

Introduction

Amway is famous as the topmost direct selling business in the whole world. The famous company was founded in the year 1959 Richard DeVos and Jay Van Andel in the country of Michigan. The company focuses on manufacturing and selling consumer items to increase the promotion of well-being and health of the people. The company has also provided lots of career scopes to the people of different countries. It is collaborating with other business houses to sell the products. For a business to grow, it is not enough to generate products and services. It is important to note that the products are sold in the right quantity. The distribution strategies should not be underrated. The main aim of Amway is to develop efficient ways to reach the customers. This study would focus on the internal and the external analysis of Amway. The internal analysis of the company would be based on SWOT Analysis. The SWOT analysis would take into account the strengths, weaknesses, opportunities and threats of the company. On the other hand, the external analysis would be performed with the help of PESTLE design. So, you need not worry about the quality of research when we provide you with Amway case study help.

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Importance of the case study:

The name Amway is given with the idea of the company functioning in American way. The company promotes direct selling and thus eliminates any kind of interferences from the mediator. The company is said to deliver some of the most expensive products that has made an impact on their sales. The prices of the products sold by the company were kept so high that the lower income citizens could not afford them. This led to the question of their distribution and marketing strategy. However, the company could successfully address all the consequences and came out to be the leading selling business house. The case study of Amway is important to meet the challenges and move towards improvement.

In order to perform the SWOT analysis and the PESTEL Analysis to complete the case study of Amway, it is very crucial to understand different aspects of the company.  Amway is one of the famous companies that has high level history in the fields of marketing. The company has a sales of around $8.4 billion dollars in 2019 that is increasing rapidly. You might use plagiarism checker tool to check the duplicay of the content

 

Swot Analysis:

Strengths

  • Strong worldwide presence: Amway is present over eighty countries of the worldwith almost 3 million agents and owners. This signifies that the company is not dependent on a single market.
  • Receiver of multiple accolades:Amway offers 115 products that is divided into 5 broad categories such as home care, wellness, gift catalogue, nutrition and personal care.
  • Broad range of customers:The product portfolio of Amway caters to broader range of customers from the infants to the adults. However, the women are the primary customers of the company.

Weaknesses

  • Limited mode of availability: The products of Amway are only accessible through the agents or the owners of the company who are into direct selling or online selling. This decreases the market share of the company.
  • Decreasing sales:The sales of the company were very low between 2015 and 2016. The sales of the company diminished by 7% in the year 2016.
  • Expensive products: The products of Amway are comparatively expensive than other companies which discourages the low income group of people to shop for their products.
  • Multi-level marketing: The company engages in multi-level marketing which is considered to be risky because the business model can collapse at anytime if the top players leaves or bring in any negative issues.

Opportunities

  • Rising availability: The company can focus on boosting the mode of availability of their products to increase their customer base.
  • Utilise different modes of communication:Amway needs to invest more in communication and explore different options such as digital marketing and advertising worldwide.
  • Bonding with different health experts and salons:Amway should consider bonding up with different health experts, salons and beauty experts. This would increase the customer base.

Threats

  • Rise in competition: Amway is facing huge competition in the nationsand in the whole world that prohibits the company to achieve high market share.
  • Low cost of switching:The products of Amway are very expensive. However, similar types of products are already available in the market. Moreover, due to the emergence of e-commerce, the cost of switching to new products is comparatively lower. Thus, the royalty of the brand starts to decrease.
  • Absence of formal agreements with the distributors:The company do not have formal agreements with the distributors to prohibit them from leaving easily.
  • Similar local product:The local products similar to those of the products of the company possess same ingredients.

The SWOT analysis provides the overview of the company taking into account the overall functioning of the company. The next section would focus on the PESTLE analysis to understand the external situation of the company. If you are looking for marketing assignment help providers in the United States, consider hiring our service.

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Pestle Analysis:

PESTLE Analysis often known as the PEST analysis is an important concept of the principles of marketing. This is an important tool used by the companies to track their operating environment to launch a new product, service or project.

Political Factors

  • Government provided allowance
  • Better understanding of the production base
  • Changes in the policies made by the government
  • The function of the local government
  • Laws and regulations
  • Political Stability

Economic Factors

  • Monetary and fiscal policies
  • Expenditures of the government
  • Income earned by the households
  • Rate of inflation and deflation
  • Growth of the economy
  • Pricing in the worldwide and the local market
  • Local manufacturing

Social Factors

  • Attitude of the people and the company
  • Assistance in terms of humane and finance
  • Better understanding of the contract signed between the society and the government
  • Population of the genders
  • Standard of health maintained by people

Technological Factors

  • Setting up departments for research and development
  • Developing products based on the feedback of the clients
  • Employing the partners of supply chain
  • Easy mode of payment

Environmental Factors

  • Type of prevailing weather
  • Change in the conditions of the climate
  • Efforts of the government to control the level of pollution
  • Endangerment of any species

Legal Factors

  • Laws related to protection of data and intellectual property rights
  • Fair treatment of all the employees
  • Following laws relating to safety and health
  • Maintenance of affordable prices and quality

These are the general points of the PESTEL analysis to be considered by Amway to maximise their advantages and profits, thus decreasing their losses. As you can see, when you avail our Amway case study assignment help service, you get all-round assistance. Thus, if you want to stand out from the rest of the class, you can contact us.

Conclusion

Amway is a worldwide company that focuses on production of home based and beauty products all over the world. However, the company mainly depends on the online mode or the agent mode of selling their products. The company tries to corporate with other business houses to expand the sale of their products. The overview of the company is important to consider for undertaking new projects and expansion of their business. Thus, the internal and external analysis of the company is performed through the mode of SWOT analysis and the Pestel analysis.

References

amwayglobal.com, 'Direct Selling Leader Amway Announces 2019 Sales Of $8.4 Billion USD' (Amway Global, 2021) <https://www.amwayglobal.com/newsroom/direct-selling-leader-amway-announces-2019-sales-of-8-4-billion-usd/> accessed 5 July 2021

amwayglobal.com, 'Jobs | Amway Global' (Amway Global, 2021) <https://www.amwayglobal.com/jobs/> accessed 5 July 2021

Babu, R. Rajesh, and Pushkar Anand. "Legal aspects of multilevel marketing in India: negotiating through murky waters." Decision 42.4 (2015): 359-378.

Groß, Claudia, and Dirk Vriens. "The role of the distributor network in the persistence of legal and ethical problems of multi-level marketing companies." Journal of business Ethics 156.2 (2019): 333-355.

Hamil, A. "A STUDY ON BUYERS PREFERENCE OF AMWAY PRODUCTS IN TIRUNELVELI." International Journal of Research-GRANTHAALAYAH 4.6 (SE) (2016): 34-47.

Keong, Lee Siew, and Omkar Dastane. "Building a sustainable competitive advantage for Multi-Level Marketing (MLM) firms: An empirical investigation of contributing factors." The Journal of Distribution Science 17.3 (2019): 5-19.

Loo, Weng Tuck, et al. "The Success Factors: A Study of Amway in Malaysia." International journal of Tourism and hospitality in Asia Pasific (IJTHAP) 3.1 (2020): 46-56.

Marx, Julian, Milad Mirbabaie, and Christian Ehnis. "Sense-giving strategies of media organisations in social media disaster communication: Findings from Hurricane Harvey." arXiv preprint arXiv:2004.08567 (2020).

Mishchenko, Viktoriia, et al. "An Analysis of Approaches regarding the Regulation of Parapharmaceutical products sales through the network marketing system in Ukraine." Research Journal of Pharmacy and Technology 13.3 (2020): 1204-1210.

Mondom, Davor. "Compassionate Capitalism: Amway and the Role of Small-Business Conservatives in the New Right." Modern American History 1.3 (2018): 343-361.

Ohi, Won-Yong, et al. "MNES’SUSTAINABILITY CHALLENGES AND CORPORATE SOCIAL RESPONSIBILITY IN EMERGING MARKETS." Sustainable Economy and Emerging Markets (2019).

Periyasami, N., and Ashish Varughese. "Network marketing of amway products by distributors in kottayam district of Kerala state." Osmania Journal of International Business Studies 5.1and2 (2010): 56-65.

Schultz H, 'Amway's Sales Drop 7%, Extending 3-Year Decline' (nutraingredients-usa.com, 2017) <https://www.nutraingredients-usa.com/Article/2017/02/10/Amway-s-sales-drop-7-extending-3-year-decline#:~:text=Direct%20selling%20giant%20Amway%20has,in%20China%20driving%20the%20slide.> accessed 5 July 2021

Song, Jinbo, Yan Sun, and Lulu Jin. "PESTEL analysis of the development of the waste-to-energy incineration industry in China." Renewable and Sustainable Energy Reviews 80 (2017): 276-289.

Squires, Scot, and Matthew Kuofie. "Unique Hurdles that Amway Faces Overseas." Journal of Marketing & Management 10.2 (2019).

Yang, Shu. "Research on WeChat Marketing Strategy." 6th Annual International Conference on Social Science and Contemporary Humanity Development (SSCHD 2020). Atlantis Press, 2021.

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