Synopsis: Uttar Pradesh Technical University, Lucknow
Synopsis: Uttar Pradesh Technical University, Lucknow
Synopsis: Uttar Pradesh Technical University, Lucknow
ON
“ A study on AmWay’s Indian marketing network”
INTRODUCTION
The case 'Amway Indian Network Marketing Experience' examines in detail the experiences of
the leading global direct marketing major Amway in India. In the initial stages, Amway had to
face a host of problems, which are explored in detail. The case then studies the remedial
In the late 1990s, the global direct selling giant Amway had to contend with increasing doubts
regarding its survival in India. The company that had become synonymous with network
marketing or multi-level marketing (MLM)1 the worldover was beset with problem. the Indians.
Though the company managed to rope in a substantial number of distributors, the attrition rate
Most of the products that the distributors bought, they consumed themselves. Estimates put the
percentage of self-consumption at almost 50-60% of the total volume. (There were rumors that
some distributors enrolled just to take advantage of the distributor's margin of 18-30%).
In the initial stages, when trials were the only criterion, this worked well. However, this self-
consumption did not translate into repeat purchases. This was because the percentage of 'active'
Amway also had to contend with customers complaining of poor customer service on the
part of the company. Analysts commented that as long as the volume of products that moved
through the network was high, network markets such as Amway were satisfied.
Even though customers complained of the lack of services, the company deemed it more
beneficial to go for higher sales force motivation programs rather than undertake customer
1
service initiatives. This was largely due to the fact that the company was almost never involved
directly with the end-consumers and the sales volumes were the end of all discussions.
Pradesh state government enacted a ban on Amway media advertisements. Amway challenged
the ban and in July 2009 the AP High Court refused a petition the ban should be enforced. As of
June, 2009 the original 2006 CID case was still pending at the Chief Metropolitan Magistrate
Court in Hyderabad.
PROBLEM IDENTIFICATION
As Amway’s products have high cost with standard quality so it is not
affordable for middle and low class customers to buy the products of
Amway
OBJECTIVES
1)-To study the Amway’s Indian Marketing network.
DATA COLLECTION
Primary Data:
Interview
Questionnaire.
Secondary Data:
Internet
Books:
Newman “ Consumer behavior” ( 7th edition)
C.R. Kothari “ Research Methodology” ( 9th edition
Questionnaire
Interview