Thursday 22 October 2020
Home      All news      Contact us      RSS     
businessinsider - 5 days ago

Home-shopping giants QVC and HSN reinvented themselves to build a booming live-streaming retail business, and are betting on payments tech to take it to the next level

Summary List Placement As seen on TV seems something of a throwback these days. But QVC and the Home Shopping Network (HSN) aren t going anywhere. And they ve seen a big boost both in their traditional broadcasts and in their digital platforms as video shopping surges in popularity. While social media platforms like Facebook and Instagram have been slowly building in-app shopping capabilities, QVC and HSN (which operate under the same parent company Qurate Retail Group) have been transitioning to digital for years. Beyond their bread-and-butter broadcast channels, these legacy video shopping platforms have been building out their own digital options as well as partnering with the likes of Amazon Fire, Facebook Live, and Roku to reach shoppers outside of their living rooms. It s been a multi-year investment, Mike George, CEO of Qurate Retail Group, told Business Insider. When the pandemic hit us, we were in a relatively good position in terms of the investments we ve made and the capabilities we ve built, George said. Qurate Retail Group s stock took a hit in March when the pandemic set in, falling to a low of $2.44 per share. It s since recovered, and is currently trading around $7.50. In the second quarter, Qurate reported revenues of $3.4 billion, up from $2.9 billion in the first quarter. And across its brands, Qurate added 2 million new customers, a 60% increase year-over-year. Digital platforms accounted for 60% of total US sales in the second quarter this year, both on the brands own websites, their Facebook and YouTube channels, and the Amazon Fire and Roku apps. As of the end of the second quarter, 3.6 million homes have downloaded the brands app as of July 31, 2020, a 100% increase year-over-year. And while the coronavirus pandemic boosted QVC and HSN s digital sales, George says that the shift toward digital was always in the cards. It s been an accelerant, but it s always been our destination, George said. Influencers are driving the live-streamed shopping boom in China, but QVC and HSN are leaning on their own brands to lure consumers In markets like China, live-streamed shopping via e-commerce apps and social media platforms is huge. Leading live commerce platforms include e-commerce giant Alibaba s Taobao Live and Douyin, China s version of TikTok. But this kind of shopping hinges on social media influencers, which can be expensive for brands. There s a lot about that model that I think will be hard to fully replicate around the world, George said. One of the challenges that I think folks are encountering in China, and also those that are trying to make a go of this in the US or Europe, is that the China model is heavily dependent on very high-profile influencers who can accumulate a big audience through their names. Read more: Social media influencers are driving billions in sales in China with live-streamed commerce. An a16z partner explains why the US could be next, and the companies positioned to take advantage As a result of that, George said, the economics of live-stream shopping largely benefit influencers, but can be cost-prohibitive for brands. At the end of the day, it costs a lot of money to get traffic to your platform, whether that s money that is going into marketing or going into having a high profile influencer to create news, George said. QVC s model is a bit different when it comes to reaching consumers, George said. Largely, that s because both QVC and HSN have been around since the 80s, and they have strong brand awareness in and of themselves. And they ve been moving into digital channels for more than a decade. QVC has had an app since 2009, and it s been integrated with Roku since 2013. To be sure, QVC and HSN aren t the only players looking to tap into the US market for video shopping. Platforms like Instagram, TikTok, and YouTube have amassed huge audiences, and brands and influencers alike have already found ways to monetize their followings through sponsored posts and advertising. Live video is the natural next step. In February last year, Amazon launched its own live streaming platform, which features scheduled live content in categories like beauty, fitness, and food. And on the startup front, there s Spin, an influencer-focused live commerce platform that launched in June. Broadcast is here to stay, but QVC and HSN are investing big in digital payment capabilities For QVC, the next evolution of its digital video shopping means introducing transactional capabilities. Currently, whether viewing a broadcast or watching a stream, shoppers still have to go to the QVC and HSN websites to complete their purchases. Introducing the ability to purchase without leaving the stream will be key in further adoption of live streamed shopping. Read more: Meet Spin, a new startup bringing live-streamed shopping— which has exploded in China— to the US. Here s how it partners with influencers and retailers for a digital window shopping experience. In the future, you ll be able to stay in the live streaming service and make your purchase, George said. That s huge for us and at the center of everything. Bringing the purchasing into the context of the video stream is essential, and that s the model adopted by leaders in China like Taobao Live and Douyin. George expects broadcast to continue to be a core part of QVC and HSN s reach. We re prepared for all eventualities, but our expectation is that broadcast remains very fundamental to the world and to our business, George said. QVC operates on 15 paid television networks, reaching 380 million homes globally. And while George expects digital engagement to continue to grow, he s not writing off broadcast. You may engage with us more day-to-day on a digital or a streaming platform, but ust touching that many homes with a broadcast signal, we think, is still hugely powerful, George said. It certainly is today, I think it will remain that way for the long term. SEE ALSO: Social media influencers are driving billions in sales in China with live-streamed commerce. An a16z partner explains why the US could be next, and the companies positioned to take advantage SEE ALSO: Inside 2020 s buy now, pay later frenzy: the new twist on financing that is a must have for everyone from top VCs to Goldman Sachs SEE ALSO: Meet Spin, a new startup bringing live-streamed shopping— which has exploded in China— to the US. Here s how it partners with influencers and retailers for a digital window shopping experience. Join the conversation about this story NOW WATCH: How NASA strategically paints its vehicles for space


Latest News
Hashtags:   

shopping

 | 

giants

 | 

reinvented

 | 

themselves

 | 

build

 | 

booming

 | 

streaming

 | 

retail

 | 

business

 | 

betting

 | 

payments

 | 

level

 | 

Sources