PMR: There were a couple. First and foremost, the one thing we absolutely had to preserve–which is at the heart of our 122-year company tradition–is the relationship between the representative, the customer and the Avon brand. That’s where our core competency is. These relationships act as a differentiator for Avon online and off. They also needed to be preserved to maintain the trust of our representatives so that they would buy in to the strategy and give it an opportunity to succeed.

We had to prove that a relationship could happen online through virtual communication. Some people believe that you have to be face-to-face to have a meaningful conversation; we’ve tried to show that high tech can be high touch.

We also were concerned about making sure the Avon brand was protected online, while still providing functionality and customization options for the rep. So many of the brand-oriented features of the eReps’ online stores are locked in, but we allow customization of content.

ER: How are the eRep’s online stores integrated with Avon’s site?

PMR: It’s essentially one store, but each eRep has their own URL. When a customer comes to Avon.com, they can locate their existing rep or they can search by street address or zip code to find a rep if they aren’t already affiliated with one. The customer is then linked to the eRep’s individual storefront. It’s basically one application, but with a variety of customization options built in. eReps can post their photographs or other images and pictures, contact information or include an “about me” section.

ER: Does an online customer have to shop through an eRepre­sen­tative or do you still sell direct? If you do, how do you address the channel conflict issue?

PMR: Our advertising and acquisition strategies have completely changed. Now, our online ad messaging is focused on driving a customer to shop with an eRepresentative, whereas before, the emphasis was on Avon.com. Every message now focuses on the value of the representative. Plus, if you shop with a rep online, you might get $3 shipping every day, plus free shipping if you spend $40, but if you shop Avon.com and you are unaffiliated with a rep, you won’t enjoy these benefits and values. It’s designed to put the representative at a competitive advantage online.

ER: Did you see this as an opportunity for any re-branding?

PMR: Actually, we tried to keep the core elements of the brand in tact and leverage them to our advantage. The way we positioned it upon launch was that for 120 years we’ve been knocking on doors and now we’re opening online stores. We wanted representatives and customers alike to understand that this is the same Avon–we just want to remain relevant and contemporize the brand going forward.

ER: Do you utilize any sort of behavioral merchandizing?

PMR: Yes. Based on past purchases, browse patterns and click-path analysis, customers will be shown different storefronts associated with different brands, such as Anew, Mark or Avon Color. The data is also used to help us present more customized and effective on-site merchandizing. It’s also leveraged to create more targeted e-mail marketing campaigns.

Although customers can shop via Avon.com (top), the goal is to drive them to an eRep’s site (bottom).

ER: What was your strategy for implementing this initiative?

PMR: The strategy was launched with most of the functionality in place. In addition to all the customization and functionality available through integration with the Avon site, other elements of the business were automated. A representative used to handwrite customer invoices, getting a calculator out to determine the correct amount to charge based on brochure price. Today, we provide online invoicing. With the click of a button, an eRep can print out all of her customer invoices, from both online and face-to-face sales. She can personalize them and present them on delivery or simply e-mail them to the customer. It’s a huge time savings, but it also preserves personalization.

We also transformed the way the reps keep and manage their address books. Before, they might have tried to keep all the addresses in a notebook, jammed with notes and stickies. Now they have an online database with a complete CRM suite that helps them manage customer birthdays, delivery dates and other customer information.

We also link this database into an e-marketing toolkit within their web office where they can develop e-mail strategies. They can even set up automated campaigns, but using personalized information about each customer to make the e-mails and offers more relevant. The e-mails are delivered by Avon, but come as a personal e-mail from the representative, rather than as corporate e-mail. Our open rates reflect the power of the relationship I mentioned earlier. When the company sends an e-mail directly, open rates are around 20 percent. When they come from a rep, open rates are often close to 80 percent.

ER: Did your reps immediately embrace the program?

PMR: There were reps–mainly newer reps–that were eagerly awaiting it and adopted it right away. But we also had to educate others to get them to buy-in. In fact, we may have initially underestimated how much we needed to be out there in the field. We had to rebuild some credibility, because of the previous online channel that did not integrate with the representative model. We worked one rep at a time to get them on board with the strategy, explaining how it was an opportunity that could really change their lives. For almost a year, I visited every single state, pitching the earnings opportunity and how the web had transformed lives–and that to continue to drive an Avon business, they really needed to be online as well as continuing to sell traditionally.

As the year wore on, I would joke that in my career online, I had helped launch some successful e-commerce sites, but now I felt that I had launched 150,000 of them. Of course, ultimately it all is about the rep. Coming to Avon as an e-commerce person, not growing up with direct selling, I’ve certainly learned to appreciate the importance of a relationship. That’s what makes the reps, and the company itself, successful. And it’s truly amazing how much power that relationship has when extended correctly onto the web.

ER: How about results? Is the program meeting your expectations?

PMR: The strategy has really taken off. Currently, 30 percent of our reps have elected to become eRepresentatives; we’re very pleased with the growth of the program year over year. With each month that goes by and each rep that shows success in the online channel, the word and buy-in spread virally through our huge Avon network.

Customer engagement metrics continue to indicate success, as well: More and more customers are choosing to shop online and representatives are there to meet their needs. In the fourth quarter last year, many eRep­resentatives outpaced traditional representatives–this was especially evident during the holiday season. Our sales outpaced the industry quite nicely during the fourth quarter, as well.

ER: Have you noticed any differences between your online customers versus those who shop traditionally?

PMR: Our online customers tend to shop more frequently, perhaps because of the ease and the ability to shop at their convenience. We also see that they tend to purchase different brands and have a higher average spend than the traditional customer. That could be because of the type of customer or because of the advanced merchandizing techniques we’re able to take advantage of online. However, our online customers are treated as multichannel customers in every respect. In every order that comes direct from Avon or an eRepresentative, we will include a brochure–we believe that exposure to the brand or our products through all channels will drive sales through whatever sales channel the customer ultimately prefers. We’ve run tests and this is a proven success model for us.

ER: Have you introduced–or have plans to introduce–any enhancements to the program?

PMR: Late last year, we made a big push toward social networking. eReps can now sell within Facebook, utilizing their online storefronts. More than 25 percent of our eReps are now participating, pushing their storefronts out on the network–and this program was just launched three months ago. We’re quite impressed with the representative engagement within the social media channel and believe that there’s huge potential there. The comments and testimonials that have come back are just amazing. It truly represents a great tool for expanding their businesses online.

We’re also introducing chat and blogs for representatives. So customers will be able to chat live with their reps, and reps can blog about the products and beauty tips, with the blogs then being syndicated out to the key online blogging sites. It’s another important initiative to further our goal of being high tech and high touch.

We’ll also be launching an online makeover tool, where a customer can put her picture up (or use a stock model) and do a makeover online to help find the right products or to experiment with various looks and then buy a look she likes immediately through the eRep store. It’s a great example of consultancy selling online and one that we’re very excited about.

The other thing we’ll be doing is giving eReps the opportunity to do online fundraising. Basically, reps will be able to offer their customers within a community the chance to buy from their eRep store, with a piece of the profit going to a local school or charity. Fundraising continues to evolve online and we think it’s important for our reps to give their customers an opportunity to give to charity, especially with the economy the way it is today.

ER: Do you have any advice for an executive of a traditional brick-and-mortar business who may be considering implementing an online program?

PMR: Walk before you run. You need to see the vision and understand where your core competencies are. Don’t abandon them–in fact, make sure you leverage them as much as possible as you transform on the web.

You also need to be aware of your organizational capabilities and your organization’s ability to absorb the changes that are inherent with moving onto the web. The Internet changes how you look at your overall business and how you conduct your business–while you need to maintain your core competencies, you also must be willing to change some fundamental business practices as you integrate the online channel.