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Avon's New Business for Reaching Young Women Set to Launch in August 2003

Company Expects Sales in U.S. of $100 Million in 2004

Sales Strategy to Offer Entrepreneurial Earnings Opportunity to Young Women Ages 16-24

PRNewswire-FirstCall
NEW YORK
Mar 28, 2003

At a meeting with investors today, Avon Products, Inc. (NYSE: AVP) announced that "mark.", its new business for reaching young women, will launch in August 2003 with a direct selling earnings opportunity created especially for women ages 16-24.

As previously announced, Avon is launching the business as part of its strategies for increasing sales growth and attracting future generations of new customers and sales Representatives to Avon. The "mark." brand will launch first in the U.S. and expand to global markets beginning in the second half of 2004. Avon said it expects "mark." to generate $100 million in sales in the U.S. in 2004, the brand's first full year of operation.

The name "mark." reflects the brand's positioning of celebrating young women who are making their mark in the world, according to Deborah I. Fine, president of Avon Future, the business unit responsible for the new venture.

"The 'mark.' brand will leverage Avon's core equities of relationship marketing and empowerment and help the company to reinvent direct selling by creating an entirely new beauty experience for young women," Ms. Fine said. "Many recent news reports and studies show that there is a shortage of viable employment options for this demographic. 'mark.' will help fill this gap, and provide young women with entrepreneurial choice, an earnings opportunity, and a platform for developing the skills needed to run their own business."

A NEW DIRECT SELLING MODEL

The new brand will launch simultaneously through Avon's core direct selling channel of over 450,000 active U.S. Representatives and through separately recruited "mark." Representatives dedicated solely to the new brand. "mark." Representatives must be at least 16 years old, and those under 18 years of age must have parental consent.

"We have an enormous opportunity to leverage the relationships that our core Representatives already have with young women," Ms. Fine said. "Our research shows that in the first year we can recruit and sell within a group of 10 million young women who are already predisposed to Avon because they know a current sales Representative. What's more, Avon Representatives are excited about the potential of "mark." to attract new customers to their existing Avon business," she added.

Ms. Fine also said that the dedicated "mark." sales force will be recruited through an integrated marketing strategy including print and broadcast advertising, the Internet, events and promotions targeted to young women at colleges, high schools, shopping malls and other youth-oriented venues. Other recruiting vehicles will include strategic alliances with world-class partners in youth-oriented industries such as music, entertainment, philanthropy and the Internet. Details on these alliances will be disclosed at a later date.

"'mark.' Representatives will be the CEOs of their own business and will enjoy compelling earnings and a safe, fun and flexible alternative to existing youth employment options -- one that fits seamlessly into their daily social and beauty rituals," Ms. Fine said. "Women naturally connect with one another through beauty and by helping one another get ready for special occasions, sharing beauty tips and trying new looks. We call these interactions Social Beauty™, which 'mark.' Representatives will leverage in one-on-one relationships or in group settings such as parties and makeovers in friends' homes or dormitories."

New "mark." Representatives will receive online training through the meet mark.com web site to learn the skills needed to manage their "mark." business. Representatives can take up to ten training modules relating to all phases of managing an entrepreneurial direct selling business. Moreover, Representatives who complete all ten modules can qualify for college credit through the University of Phoenix, the nation's premier provider of online education programs and training.

"mark." Representatives will also use the meet mark.com web site to place and track their product orders and manage their "mark." business. The site will enable them to order products for their customers 24 hours per day, seven days a week, and receive shipment of their orders within two-to-three days.

Commissions on the sales of "mark." products will be 40% for beauty products and 25% on non-beauty items such as fashion jewelry and accessories. In addition, "mark." Representatives will be able to recruit other young women to advance their earnings opportunity. They also will be able to accumulate points based on sales volume and redeem them for prizes tailored to their lifestyles, including movies, entertainment, music, travel and electronics.

SEPARATE PRODUCT LINE

The fully separate "mark." product line is designed to have a hip, modern appeal and will number several hundred stock keeping units (SKUs) encompassing color, skincare, bath and body, fragrance, fashion jewelry and accessories. "mark." beauty products will be priced somewhat higher than Avon's core product line and on par with those of mass retail competitors.

The products will be sold through a large-format "magalog" featuring both products and editorial material of interest to young women. "mark." expects to publish some 16 million magalogs for every six-week sales campaign, making it the largest print vehicle for reaching this demographic. Called "meet mark.", the magalog will be designed to reflect the spirited and goal-oriented attitude of the brand.

Avon is the world's leading direct seller of beauty and related products, with $6.2 billion in annual revenues. Avon markets to women in 143 countries through 3.9 million independent sales Representatives. Avon product lines include such recognizable brand names such as Avon Color, Anew, Skin-So-Soft, Advance Techiniques Hair Care, beComing and Avon Wellness. Avon also markets an extensive line of fashion jewelry and apparel. More information about Avon and its products can be found on the company's web site www.avon.com.

SOURCE: Avon Products, Inc.

CONTACT: Media - Victor Beaudet, +1-212-282-5344, Debora Coffey,
+1-212-282-5660, or Investors - Renee Johansen or Rob Foresti,
+1-212-282-5320, all of Avon Products

Web site: http://www.avon.com/
http://www.mark.com/

Company News On-Call: http://www.prnewswire.com/comp/079575.html

 
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For Corporate Communications:
Joyelle Rowe
Associate
Corporate Communications
+1(914) 935-1884
joyelle.rowe@avon.com

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