Amway begins digital shift as tech disrupts direct sales
Amway Thailand Ltd, a direct sales firm, is reorienting its business model towards digital platforms in a bid to tackle technology disruption.
Kittawat Ritteerawee, the company's managing director, said Amway recently set up a digital department and budgeted 100 million baht to prepare for digital expansion.
Amway has invested in multiple digital platforms to bring new experiences to Amway Business Owners (ABOs), the company's term for those authorised to distribute Amway products.
With full-fledged e-commerce capabilities and new enterprise digital platforms, ABOs can manage their businesses more easily and take advantage of social selling to provide seamless, personalised digital experiences to customers, Mr Kittawat said.
"This major investment will enable Amway to keep its leading pace in the digitally disrupted world," he said, adding that sales of Amway via the digital channel are expected to reach 40-50% of total sales of 30 billion baht in 2025, up from 10% at present.
The moves are meant to ensure Amway's sustainability in the long term amid technology disruption.
"According to a global Amway survey, 77% of millennials want to be an entrepreneur but they have many business options to choose," Mr Kittawat said. "Therefore it's necessary for Amway to modernise the business model in line with social commerce to suit new millennials."
Amway Thailand will also increase the ABO performance bonus.
"Amway's new performance bonus will be used from Sept 1 this year," Mr Kittawat said. "It is realistic, contemporary and potentially a stable source of income."
The company will allocate about 1 billion baht each year to the new incentive programme.
Kittawat Ritteerawee, managing director of Amway (Thailand) Ltd. *No photo credit*
According to Mr Kittawat, Amway has adapted well to the rapidly changing global marketplace to ensure that the company is always up to date, competitive and equipped with the capability to meet the lifestyle needs of young people who prefer the idea of entrepreneurship offering true income-generating potential.
The direct sales market was worth 69 billion baht in 2018 and is expected to grow by 2% this year, driven by big players, new products and improvements to business platforms.
Amway sales in the first half of 2019 grew by 10% year-on-year. The company reported 19 billion baht in 2018 sales.