Strategy
Amway Calls On Properties To Help Re-establish Brand, Update Image
Properties with broad appeal could be in line for direct-seller’s new sponsorship initiative.
7/28/08: To support the reintroduction of its flagship brand to North America, Amway Corp. has spent an estimated low seven figures on new sponsorships and plans to sign additional ties.
The direct seller has thus far taken presenting status of Tina Turner’s North American tour and will sponsor a YMCA of the USA wellness program that includes events at hundreds of YMCA locations starting this fall.
The sponsorships coincide with a multimillion-dollar ad campaign to promote the Amway Global brand.
When parent Alticor, Inc. migrated Amway’s direct-selling operations in the U.S. and Canada to an Internet-based e-commerce model in ’99, it was done under the brand of a new subsidiary–Quixtar, Inc. Amway’s operations in 80-plus other countries continued to use the person-to-person model and the flagship brand appended with “Global.”
Because the Quixtar moniker never caught on, the company is phasing it out as a brand in favor of Amway Global, a transition scheduled to be completed by next May.
“We are investing in the Amway brand largely because we are going through a transition in resuming its use,” said Beth Dornan, Amway’s director of marketing services. ”We weren’t terribly sophisticated about the Quixtar brand and we realized we had given up a really powerful asset.”
The Amway name still has 80 percent awareness among North Americans, Dornan noted, in sharp contrast to Quixtar’s three percent awareness.
The use of the Amway Global name reflects that the majority of the company’s business is overseas, said Dornan, who notes China is Amway’s largest market.
In addition to reestablishing its brand, Amway is looking to sponsorship to introduce consumers to its products–including its flagship Artistry cosmetic line and Nutrilite vitamin supplements–and to the business opportunities offered by multilevel marketing.
“A lot of people have perceptions about Amway that are no longer true, so we want to show people what the company is all about, as well as discuss our business opportunities,” Dornan said.
On the recruiting side, the company wants to reach young, prospective independent business owners, as well as the families and friends who influence their decisions, Dornan said.
What’s Tina Got To Do With Amway?
Amway was drawn to the Tina Turner sponsorship partly because of the deal’s “wow” factor.
“We want to surprise people because aligning the Amway name with a music tour such as Tina Turner’s is something that people do not expect,” Dornan said. “We’re trying to change people’s minds about who we are and encourage them to think about us a little differently.”
Turner’s appeal to consumers ranging from teenagers to those in their 40s and 50s was a big plus, Dornan said.
Amway receives ID on tickets and tour ads, as well as signage and video presentations at each concert venue. It also gains one-on-one marketing opportunities to sample product and recruit distributors.
The tour kicks off in October and will visit more than 20 U.S. and Canadian cities through the end of the year.
Amway will use its YMCA partnership to promote Nutrilite and other health and wellness products.
“The YMCA has a lot going for it in terms of reach,” Dornan said. “There are more than 20 million members nationwide, and the organization is a great partner for accessing our target consumer that is interested in family health.”
As part of the program, Amway will award educational scholarships to 50 teens who have created programs to improve health and fitness in their communities. The company will promote the program through an advertorial in Newsweek magazine.
Amway will determine success based on the number of customer interactions, interest by potential Amway business owners and incremental sales, Dornan said.
“We can target incremental sales and potential independent business owner interest on a market by market basis.”
An active sponsor in the early ’90s, Amway has largely shied away from sponsorship over the past 15 years. The company is in the second of a four-year, $1.5-million-total naming rights deal for Orlando, Fla.’s Amway Arena, home of the NBA Magic. The team is owned by Amway founder Richard DeVos.
Amway also has endorsement deals with four track and field athletes that compete under the Team Nutrilite banner. It sponsors a handful of events in which the team competes, including the Adidas Track Classic in Los Angeles; Eugene, Ore.’s Nike Prefontaine Classic; the Reebok Boston Indoor Games; and Fayetteville, Ark.’s Tyson Invitational.
Steve Lieberman, Amway’s managing director, North America, signs off on sponsorships.
| Structure, Revenue-Sharing and Local Affiliate Incentive Models |
| Company/Contact |
Deals |
Additional Comments |
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Avon Products, Inc.
Carol Kurzig, executive director, Avon Foundation
212/282-5000 |
Avon Walk for Breast Cancer (nine U.S. markets); Avon Walk Around the World for Breast Cancer (51 international markets); Need for Speed Relay Against Domestic Violence, Westchester County, N.Y. |
Avon’s events are funded through the Avon Foundation. Established Need for Speed 50-mile fund-raising event in ’06; has partnered with seven established relay races in ’08 to form national series. |
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Herbalife Int’l, Inc.
Brian McKinley, senior director of corporate alliances
310/410-9600 |
Primary: MLS LA Galaxy. Presenting: Kaiser Permanente Los Angeles Triathlon; Sony Ericsson WTA Tour East West Bank Tennis Classic, Carson, Calif. Cosponsor: Amgen Tour of California; AYSO; IndyCar Series team; Nautica Malibu Triathlon presented by Toyota |
Has additional overseas sponsorships. Galaxy shirt sponsorship estimated at $3.5 million-to-$5 million per year through ’11. Earlier this year inked four-year tie to AYSO that affords branding on soccer jerseys. Has endorsement deals with a handful of pro athletes. |
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Nu Skin Enterprises, Inc.
Ashok Pahwa, chief marketing officer
801/345-1000 |
Title: Nu Skin Theatre at EnergySolutions Arena, Salt Lake City. Cosponsor: America’s Freedom Festival, Provo, Utah; Brigham Young University athletics; NBA Utah Jazz |
Jazz deal includes title of the Nu Skin Jazz Dancers. Markets personal care products under Nu Skin brand, nutritional supplements under Pharmanex brand; and technology products under Big Planet brand. |
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Usana Health Sciences, Inc.
Alan Bergstrom, vice president of customer relations
801/954-7100 |
Title: Usana Amphitheatre, Salt Lake City. Cosponsor: Sony Ericsson WTA Tour; Speed Skating Canada; USA Luge; US Speedskating |
Marketer of nutritional supplements and other products this spring signed a three-year tie to USA Luge as official supplement supplier and a two-year endorsement deal with U.S. bobsledder Ivan Radcliff. |
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XanGo, LLC
John Digles, senior vice president of sales and marketing
801/816-8000 |
Primary: MLS Real Salt Lake |
Inked four-year RSL shirt sponsor tie–the first such deal in MLS–in ’07. Juice marketer uses tie to motivate distributors and play up health, wellness and fitness positioning. |
Sources
Amway Corp., Tel: 616/787-7000