Direct Selling in the Czech Republic

2020 IMPACT

Direct selling agents seek new ways to communicate with customers and boost sales in 2020

Direct selling was negatively impacted by the pandemic, as there were fewer opportunities for face-to-face contact and there were restrictive measures on big group gatherings, which meant that sales parties—which are very important for this channel—could not take place. However, some players adapted their strategies and maintained interaction with customers through online channels, such as Teams and Zoom meetings.

Avon Cosmetics leverages its extensive network to lead sales in 2020

Avon was recently taken over by Natura, creating the fourth largest cosmetics company in the world, with a turnover of more than USD10 billion. Avon remains the leading beauty and personal care brand and direct seller in the Czech Republic, ahead of key competitors Oriflame Czech Republic and LR Health & Beauty Systems.

Herbalife benefits from consumer concerns about wellbeing and immunity during the pandemic

Herbalife Nutrition, specialising in vitamins and immunity products, registered the least decline in sales in the channel in 2020 and consolidated its value share thanks to growing concern among Czech consumers about wellbeing and immunity during the pandemic. Other sellers were less fortunate and suffered heavy losses.

RECOVERY AND OPPORTUNITIES

Channel will need to adopt online strategies to remain competitive in the future

Direct selling is set to maintain positive growth over the forecast period. However, the channel will need to adapt to the new reality of e-commerce to remain competitive in the future.

Developing health and wellness trends will drive sales growth

Thanks to the developing health and wellness trend in the Czech Republic, health food and supplements were already the main drivers of sales in this channel during the review period. The COVID-19 crisis reinforced this trend, with these products in high demand, as consumer concerns about immunity and wellbeing grew in the wake of the pandemic.

Czech consumers value personal contact and relationships with direct sellers

Direct selling will remain popular among Czech consumers who value the personal aspect of direct selling, which is rarely offered via other channels. For example, Zaren, a direct seller focusing on healthy sleeping products, such as pillows and mattresses, uses professional call centres and does not rely on selling agents for sales leads.