Amway to shun e-commerce

Admin   |   13 February, 2015   |   786   |   3980

Amway, India's largest direct selling company, said that the company's stance on not allowing to sell its products on e-commerce sites remain unchanged.

Speaking on the sidelines of a product launch, Sundip Shah, chief marketing officer of Amway India said, " We will distribute our products only through our distributors and have no plans to adapt the e-commerce mode as our main strength is word-of-mouth." Direct selling companies like Amway, Tupperware and Oriflame had earlier issued notices to Flipkart, Ebay and Snapdeal asking them to stop selling their products on their platform.

Under Amway's business model, distributors, enrolled for free, earn commissions on sale of products directly to consumers, in addition to a share in business volumes of their group, comprising other distributors. About half the 1.5 million direct distributors Amway operates through are actually consumers who have turned distributors, primarily to buy for themselves at a discount.

But in a a substantial change from its earlier marketing initiatives of not advertising the company has now planned to " advertise aggressively" to increase their brand visibility through print, television and digital campaigns. " Now we have an annual advertisement budget of Rs 60 crore in order to create a brand for our products before our distributors take it to the customers," Shah said.