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January 02, 2011

Company Spotlight

JAFRA: Royal Dynasty

by Brittany Glenn

The year was 1956. It was a time when women were defined mainly by what their husbands did for a living—and not the work they did on a daily basis. That year, Jan and Frank Day launched a small company out of their garage in the seaside community of Malibu, Calif. The couple decided to name the company JAFRA, which was a combination of their first names.

From the beginning, Jan focused on creating an opportunity for women to become small-business owners—a fairly radical concept for that era. Women were attracted to the idea of contributing financially to their families while being their own boss with control over their work life.

Fast-forward to the year 2011. Women’s role in society has changed dramatically, and the little company with a big dream has become a multinational corporation. Today, JAFRA Cosmetics International Inc. boasts global annual revenue of more than $500 million and has 550,000 consultants in 17 countries around the world.

What hasn’t changed is JAFRA’s focus on helping women transform their lives with the company’s powerful business opportunity.

Connie Tang“JAFRA has transformed the lives of literally hundreds of thousands of women around the world for 55 years,” says Connie Tang, President of JAFRA USA. “Because of the longevity we’ve had in the direct selling industry, it’s not only their lives, but the lives of our second- and third-generation JAFRA consultants. It’s also about the legacy that they leave behind.”

It’s not just women’s lives that have been transformed, but also men’s. “What’s exciting is not only are there more men in the business now, but the fact that they’re beginning to excel,” says Tang. “We just awarded a Mercedes Benz to a young Hispanic man who was born and raised in the United States and whose mother has been a Director with us for 13 years.

“So we’re seeing the opportunity now passing on to the next generation from a demographics standpoint as well as from a biological aspect. We continue to maintain our foothold in the Hispanic marketplace while expanding the roots to the second and third generation who grew up with JAFRA in the house.”

JAFRA 2010 Circle of Excellence Recipients.
JAFRA 2010 Circle of Excellence Recipients.

Hispanic Heritage

During the 1960s, JAFRA added the first Spanish-speaking consultant to help the company reach the emerging Hispanic community. It was a fortuitous step. Today, more than half of JAFRA consultants in the United States are Hispanic.

“The face of the ‘general market’ is really diversifying and changing,” says Tang. “This is affording us with expansive opportunities to continue to penetrate the U.S. market through targeted developments in all ethnic groups and leveraging the brand-name recognition that JAFRA carries in the Hispanic market.”
Latinos are the fastest-growing population in the United States, and by 2050, their numbers are expected to eclipse those of any other ethnic group. The U.S. Census Bureau estimated in 2009 that 15.8 percent of the population in the United States was Hispanic. It is projected that by 2050, the Hispanic population will constitute 24 percent of the nation’s total population. The estimated purchasing power of Hispanic Americans is expected to reach more than $1 trillion in 2011.

Reaching the Hispanic market effectively means understanding the culture and values of the people, a feat that many companies are scrambling to achieve today. However, JAFRA has been cultivating a relationship with the Hispanic market for more than 40 years.

“The demographic is extremely loyal to brands,” says Tang. “This is why there are many tried-and-true heritage brands that have huge Hispanic followings. Developing the Hispanic market requires developing relationships of trust. As a brand and as a company, you’re rewarded with loyalty long-term that’s carried from generation to generation.”

How did JAFRA establish its foothold in the Hispanic community? “Our Hispanic market development began not necessarily consciously or strategically,” says Tang. “It really began with the vision of Jan Day, our founder. She had a vision to offer all women an opportunity, and someone offered the opportunity to one of our Hispanic leaders in California. That spawned the organic development of the U.S. Hispanic market for us. Also, I think JAFRA’s presence in many global markets like Brazil, Mexico, Chile, Argentina and Colombia helped to foster that brand-name recognition from the very early days before the Hispanic market was sought after.”

Infrastructure Infusion

In 2004, Vorwerk & Co KG—a multibillion-dollar family enterprise with headquarters in Wuppertal, Germany—acquired JAFRA. Established in 1883, Vorwerk is the world’s third-largest direct selling company. One of the benefits of the acquisition was an infusion of capital investment in JAFRA’s infrastructure.

“The purchase of JAFRA by Vorwerk gave the company some significant confidence in ongoing strategic developments,” says Tang. “Vorwerk has a proven track record of patience for long-term strategy and investments. This helped us to focus on plans to continue to prosper, develop and grow on a global basis.”

In 2010, many of these plans reached fruition. At the beginning of the year, JAFRA launched a new corporate website featuring a revitalized brand image with contemporary graphics, fresh content and interactive tools as well as a revamped portal for the U.S. market and new personal websites for consultants.

“We identified a need to have a strong and compelling digital strategy and platform,” says Tang. “In 2010, we launched phase one and two of a multi-year global digital strategy implementation with an investment of $15 million. The United States is leading the way and setting the blueprint for the rest of the world.”

Also in early 2010, JAFRA opened a new manufacturing complex in Querétaro, Mexico. The new facility is twice as large as the previous one and processes more than 1,200 ingredients in making JAFRA’s products. Spread over 23 acres, the manufacturing complex houses JAFRA’s newest processing and packaging technologies, laboratories, offices and other services needed to comply with the most modern standards for cosmetic production.

“Our previous manufacturing facility in Mexico City was busting at the seams,” says Tang. “Because of our growth forecasts, we made the decision to build a brand-new manufacturing facility, investing in our future to the tune of more than $32 million.”

Additionally, in September 2010, JAFRA USA opened a new centralized distribution center in Lewisville, Texas. “It was a $2 million investment to update our facilities, software and pick-and-pack system, and also to look for more service-friendly routes with our partner FedEx,” says Tang. “JAFRA has truly gone through a full circle of evolution, inside and out.”

JAFRA’s tribute to its Circle of Excellence recipients. JAFRA’s tribute to its Circle of Excellence recipients.

Compensation Plan: Multi-level

USA/World Headquarters: Westlake Village, Calif.

Websites: www.JAFRAUSA.com and
www.JAFRA.com

Company Slogan: The Power to Transform Lives

Vision: To be the Number One Opportunity

Choice for Women Around the World.

Parent Company: Vorwerk & Co KG (Wuppertal, Germany)

Investing in People

JAFRA’s investments are not only high-tech; they are also high-touch. The company understands that its greatest investment of resources should be in its consultants—the very lifeblood of the business. JAFRA provides a very supportive environment for its consultants, aided by a corporate national sales team whose mission is to work hand-in-hand with consultants to achieve their goals and dreams.

“One of our biggest investments has been in our national sales team staff members who live and breathe with our leaders,” says Tang. “These are corporate employees whose working life is to be out there in the trenches, in the car, in the hotel room or the coffee shop, helping people put into practice those skills that we try to help them foster.”

Tang’s corporate national sales team in the United States includes 18 individuals, the majority of whom are bilingual.

“There’s a minimum 70 percent required travel time for them,” says Tang. “In addition to managing office time with conference calls and webinars or e-mailing, the bulk of their focus is face-to-face time. The job description for these key team members is very specific about how we want them to manage their time and work with the salesforce. We have a very targeted approach.”

As a result, JAFRA has mastered the art of effectively communicating with consultants in different market segments. “We’re very good at not using a one-size-fits-all approach with our Hispanic market, African-American market, Asian-American market or general/English-speaking market,” says Tang. “We speak to our markets in a culturally attuned style that is best for them, because we know them. We can see it through their eyes, because we live it through their eyes.”

Product Power

The JAFRA product portfolio offers more than 700 products available in collections of skin and body care, color cosmetics, spa, men’s skin care and grooming, baby care and fragrances. The products are designed for all ages, skin conditions and skin tones.

Originally developed in the 1950s, the Royal Jelly collection is JAFRA’s five-product, flagship product line. The collection helps prolong skin vitality and reduce the appearance of wrinkles, leaving the skin looking smoother and radiant. Royal jelly is produced by bees and has been used as a skin elixir for centuries, dating back to ancient Egypt.

“The Royal Jelly collection is still our No. 1 signature product line worldwide,” says Tang. “The company was founded with this product line, so it’s legendary and world-renowned. It’s available in all 17 of our countries. The magic of Royal Jelly and its long staying power is that it really works. It continues to perform and deliver results to all age ranges and all skin types.”

The Royal Jelly Milk Balm was reformulated in 2008 and now features two of the latest breakthrough technologies—sirtuin activators and an exclusive Cellspan Complex. “It was time for us to incorporate some new ingredient stories,” says Tang. “Sirtuin activators help stimulate the enzymes essential in the production of collagen to help you look younger longer.”

JAFRA has a stringent product-development process, including the requirement that each product has a story behind it that consultants can communicate to their clients. “Products must stand the test of the story, so that one woman telling another that same story and how she personally experienced results delivers an authentic message,” says Tang.

With so much success behind the company, JAFRA is preparing to announce still more exciting product-development news this year. “2011 will be a banner year for us in product development,” says Tang. “We’ve got some innovative and compelling stories to tell.”

Future Forward

JAFRA’s vision is to be the No. 1 opportunity choice for women around the world. With this goal in mind, the company recently accelerated its international expansion process by opening an office in New Delhi, India.

“India is our first big step into Asia,” says Tang. “Our commitment is to continue to open a new market every year for the next five years. Our focus will be on developing Asia, Latin America and Eastern Europe.”

Meanwhile, here in the United States, JAFRA will continue to embrace diversity in the future as it has in the past. “In the last 10 years, I think many companies—in both direct selling as well as traditional corporate America—have awakened to the fact that the face of America is changing,” says Tang. “They perhaps realized they were limiting their potential and audience to a smaller segment, which is a missed opportunity.

“JAFRA is a couple of steps ahead in terms of embracing the diversity of what America has to offer, which is what’s going to continue to fuel our consultant base development. Whether you’re an immigrant or you were born here, there is the magic of the American dream—of building your own business and being your own boss. I don’t think that ever goes away.”