Direct selling has been hit hard by COVID-19, largely thanks to the tight restrictions placed on travel, social distancing and social gathering over the year that have made the sales model inoperable for many direct selling agents. There has been significant regional variation in the depth of restriction, but Baku, the most important consumer base for this channel, has been especially tightly locked down – the city’s metro remains closed at the start of 2021, for example – and in addition, consumer anxiety about the risks of exposure to infection means that they are far less likely to invite people into their homes to make a sale.
Direct selling in Azerbaijan is dominated by Oriflame Azerbaijan, Faberlic Azerbaijan and Avon Products Inc, all of whom are primarily beauty and personal care sellers. Demand for these products has been undermined over the year by restrictions on social gathering, workplace shutdowns and the closure of entertainment venues.
The range of products sold via direct selling in Azerbaijan is extremely narrow, reflecting the immaturity of the channel and the fact that most Azerbaijanis will choose a physical outlet where possible. As discussed, beauty and personal care is the dominant type of product.
Direct selling is set to see moderate growth over the forecast period, underpinned by a mixture of factors. Historically, sales staff recruitment in the channel is easiest during recession, as consumers look around for ways to supplement income.
Direct selling remains a negligible part of retailing in Azerbaijan, in part thanks to decades of under-investment and poor management from leading operators. In 2019, for example, one leading player ran television advertisements on Russian-language channels in the country, but did not provide an Azerbaijani contact number, instantly limiting potential recruitment candidates.
Young Azerbaijani consumers of beauty and personal care products, the backbone of the channel, are increasingly using social media, online bloggers and other digital media to track global fashion and beauty trends. Surprisingly, this lines up well with the supposedly antiquated direct selling model.
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This report originates from Passport, our Direct Selling research and analysis database.
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