The Times 100 - Edition 13 - Amway Brief Case Study

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Amway

Meeting customers' needs through the Internet

Introduction

The Internet has quickly become very important to businesses. It allows one computer to talk to others, linking them across the world. The main way of doing this is through websites.

What is Amway?

Amway is one of the world's largest direct sales companies. It makes and brands its own products. It sells these to people who want to run a business selling Amway products. These people (called Independent Business Owners or IBOs) then sell them to consumers. Amway gives IBOs help and support when it is needed.

Amway thought that the best way to do this, across the world and at any time of the day (24/7) was through websites. It carried out some market research to see if its IBOs would be keen to work this way. It found that many IBOs:

  • wanted advice and information quickly
  • wanted to work from home

The Amway model

Amway helps IBOs by giving them advertising and other material to help sell its products. Products are then ordered from Amway by IBOs. A website allows IBOs to get the information they need, and also to order products on-line. It also lets them work at any time of the day they want, and from where they want.

Amway's plan

Amway's plan was to provide websites for all of Europe in just two years. As far as it could, it grouped countries together to lower costs. Once the first sites were running, Amway could see that the direct sales model worked well on the web.

Amway then took the best parts of the sites - the bits that worked the best - and used these in its new sites. The new site in the UK is called AMIVO. Over a third (and rising) of Amway's UK sales are now made using this website.

Conclusion

Amway uses the web to link to its 3.3 million IBO customers all over the world. The web helps with sales, advice, transport, distribution and production. The use of the web has helped Amway - with its direct sales model - to compete better with other businesses that use more traditional methods.

       
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