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Title: AMWAY CASE STUDY- MyAssignmenthelp.com


1
Amway
Case
Study
CREATING A CORPORATE SOCIAL RESPONSIBILITY
STRATEGY
2
About Amway
Amway is considered to be the pioneer of
multilevel marketing and direct sales marketing.
The original product offered by Amway was liquid
cleansing. It was the first concentrated,
bio-degradable and environment-friendly cleansing
product.
3
About Amway
Amway has become the worlds largest direct sales
business with 3 million independent consultants
who promote more than 450 personal care,
household, nutrition and cleaning products. It is
a global player of personal and skin care.
4
Brief History of Amway
5
Brief History of Amway
Amway has rich adventurous history.
6
Brief History of Amway
Amway was founded by two Dutch friends
Richard M. DeVos, born in the small nearby
community of Ada in 1926
Jay Van Andel, born in Grand Rapids, Michigan, in
1924
They met at Christian High School in Grand Rapids.
7
Brief History of Amway
After they returned from World War II, they
started a flying school. After they got some
experience in other business as well, they sailed
to Latin America. But the vessel sank in the
Caribbean and they had to stay in South America
for six months. 
In 1949, Jay Van Andel and Rich DeVos become
distributors of the Nutrilite brand.
8
Brief History of Amway
When they experienced modest success in their
retail sales, in April 1959 they created American
Way Association and later renamed it as Amway
Distributors Association with the purpose of
protecting individual distributors.
9
Brief History of Amway
10
The Vision of Company
Helping people live better lives
11
SWOT Analysis of Amway
12
SWOT Analysis of Amway
With SWOT analysis, strengths, weaknesses,
opportunities and threats can be reviewed in
order to decide further planning for the
organization.
13
SWOT Analysis of Amway
Strength
  • Amways One-by-One campaign for children engages
    various countries, employees and distributors to
    help children in need. The campaign has tasted
    success in United States, Guatemala and China

14
SWOT Analysis of Amway
Strength
  • Amway is experiencing increasing retail sales
    worldwide

Weakness
  • The only way one could get hold of the Amway
    products is online facility and through business
    agents. It is missing on the revenue it could
    earn from retail sales

15
SWOT Analysis of Amway
Strength
  • This multinational American company has bagged
    several awards like Asia Pacific Frost Sullivan
    Water Filtration Company of the Year Award and
    LEED Gold Certification

Weakness
  • The cost of the products is high compared to
    other brands

16
SWOT Analysis of Amway
Strength
  • Amway is considered among the top 30 Americas
    privately held companies

Weakness
  • Amway does not promote its products and services
    by TV advertisement or any brand ambassador.

17
SWOT Analysis of Amway
Strength
  • This company does trading in more than 80
    countries with more than 3 million individual
    business owners

18
SWOT Analysis of Amway
Strength
  • Amway has a wide range of products divided into
    five categories personal care, home care,
    nutrition and wellness, cosmetics and gift
    catalogue.

19
SWOT Analysis of Amway
Opportunity
  • Increasing availability of the products in
    international market

Threats
  • Competition is increasing with days both
    nationally and internationally

20
SWOT Analysis of Amway
Opportunity
  • Online platform has proved to be an ideal scope
    for Amway to promote its products internationally

Threats
  • There is a possibility that the consumer could
    switch to competitors products as they are
    cheaper

21
SWOT Analysis of Amway
Opportunity
  • There is a bright opportunity for this
    organization. It could tie up with national and
    international chains of beauty salons and beauty
    experts in order to introduce its products to
    more consumers.

Threats
  • Local products pose threat to this company as
    they are cheaper in cost and feasible to more
    consumers.

22
PEST Analysis
23
PEST Analysis
Economical factors
  • The success behind Amways growth is the
    localization of the employees, business model,
    production and raw material

24
PEST Analysis
Economical factors
  • This company has invested 1.5 million to
    localize RD model in China

25
PEST Analysis
Political factors
  • It was 20 years ago in 1995 when Amway entered
    the Chinese market. This company had experienced
    success. But at the same time it faced challenges
    as China was becoming a democratic country. But
    in 1998, China officials placed ban on the direct
    marketing, as the Chinese government thought
    direct marketing was the base of criminal
    activities. But after three months, they lifted
    the ban after heavy lobbying from American
    businessmen and Amway got its market back

26
PEST Analysis
Economical factors
  • Amways board of directors takes the
    responsibility to provide an overview of the
    company to its shareholders and stakeholders

27
PEST Analysis
Economical factors
Political factors
  • This company has re-located its production
    factories in China in order to export products in
    the Asian countries
  • 50 percent of raw material is acquired from the
    Chinese market

28
PEST Analysis
Economical factors
  • The labor cost in China is cheaper compared to
    United States, so 2000 Chinese were appointed
    employees in this company

29
PEST Analysis
Economical factors
  • Amways economic growth has increased due to its
    low cost and low risk business opportunity for
    IBOs (independent business owners) based on
    selling quality products.

30
PEST Analysis
Technological factors
Social factors
  • Amway contributed in the development of local
    communities by providing them financial and human
    support in areas like art, culture, human
    service, education, sports and environment
  • Amway has set up RD department in order to
    conduct researches on how to manage teamwork to
    achieve its vision. For example, One-by-One
    Campaign has proved to be a successful one for
    the company

31
PEST Analysis
Technological factors
Social factors
  • This company has invested 4 million for this
    cause
  • This company changes its technology based on the
    system. For instance, shareholders and
    stakeholders have to meet IBOs, employees and
    board of directors to get more information about
    the company

32
PEST Analysis
Social factors
  • This international organization is aware of
    increasing health consciousness in consumers, so
    it creates products out of natural resources that
    are investigated by thousands of professional
    scientists in order to provide safety and
    security to consumers. This step prevents
    environment from any harmful impact.

33
PEST Analysis
Technological factors
  • Amways website has increasing rate of visits
    from interested stakeholders and shareholders who
    want to invest in the company

34
PEST Analysis
Technological factors
Social factors
  • Artistry products that come under the Amway brand
    are proved to be harmless for the skin and no
    artificial color is used in its production.
  • This company has developed new tailored products
    like whitening cream as its new innovation.

35
Conclusion
36
Conclusion
  • Amway maintains family values as it grew out of a
    family business.
  • The IBOs of the company are inspired to
    contribute in the communities in order to make
    difference in other peoples lives.
  • This organization strives to practice environment
    aspects and improves the existing products.

37
Conclusion
  • This international brand continues to rise on the
    economic curve.
  • Shown other corporations how to manage the work
    force and direct positive force.
  • This has brought forth their new brand name,
    Amway Global

38
Conclusion
With these two models, the company can understand
what should be the future strategies for the
organization in order to continue their success
journey. The reviewer can
comprehend what are the areas that this company
still need to work and what should be the ways to
fight the odds in the competition.
39
Conclusion
By evaluating the SWOT and PEST analysis, you get
to know crucial facts that are significant in
building marketing strategies.
40
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41
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