Case Detail

Case Summary

Mary Kay Corporation: Direct Selling and the Challenge of Online Channels

Case Number: 5-104-009, Year Published: 2004

HBS Number: KEL034

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Authors: Anne Coughlan; Erica Goldman

Key Concepts

Distribution Channels, Information Technology, Consumer Marketing, Marketing Strategy, Information Management, Sales Force Management

Abstract

Mary Kay is one of the best-known direct sellers of women's cosmetics in the world. Its channel strategy is to use Independent Beauty Consultants, whoa re independent distributors, to sell directly to consumers. Its compensation plan is mult-level, providing commissions to distributors on their own sales as well as the sales of the distributors they recruit. At the time of the case, the company is grappling with a well-established change in consumer behavior - the decline of the stay-at-home mom as she returns to the workforce - combined with the opportunities offered by Internet selling. The case focuses on the company's efforts to move with consumer demand and behavior, while remaining true to its core goal of "Improving Women's Lives." It discusses ways Internet technology can be used throughout the company's channel and supply chain structure, noot just as a route to market.

Number of Pages: 23

Extended Case Information

Teaching Areas: Marketing

Teaching Note Available: Yes

Geographic: Texas, United States

Industry: Cosmetics

Organization Name: Mary Kay Corporation

Organization Department: Technology

Organization Size: Medium

Decision Maker Position: VP e-Business

Decision Maker Gender: Male

Year of Case: 1999