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Avon to Ramp Up Ad Budget

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NEW YORK--Beauty marketer Avon will increase its marketing/advertising budget next year, as the company has done over the past several years.

Chairman and CEO Andrea Jung, addressing analysts during a conference call Wednesday, said its $90 million budget will jump $40-$50 million globally in 2002. Over the next three years spending is expected to be up $150 million from this year's levels. Most of Avon's advertising is handled in-house, though J. Walter Thompson, New York, handles Avon's retail account.

Sales for Avon's recently launched retail line, Avon Becoming, are on track for 20-25 percent of J.C. Penney's cosmetic sales, said Jung, added that and the best selling SKUs seem to be the higher priced items such as the $40 skin creams.

Negotiations are continuing for a second retail partner, and Avon hopes to be able to make a formal announcement by Thanksgiving, Jung said. Plans to launch Becoming in 125 Sears Roebuck stores were scrapped this summer. "We had good dialogues going in late August, early September, but (Sept. 11) set us back a bit," said Jung.

Sales grew by 6 percent to a record $1.41 billion, driven by a wider product range and a 10 percent increase in the number of sales reps worldwide.