En­gag­ing the Cus­tomer Is Key to Qu­rate’s Suc­cess

WWD Digital Daily - - News - BY VICKI M. YOUNG

WWD: Given the tech­tonic changes shak­ing re­tail, how is Qu­rate adapt­ing to all of that change?

Mike Ge­orge: The com­pany has evolved enor­mously from its roots as a TV shop­ping com­pany in the U.S. 30 years ago with our QVC busi­ness. We do live at this very won­der­ful and strange in­ter­sec­tion of re­tail and me­dia, con­tent and com­merce and so­cial, and also brand mar­ket­ing be­cause we're re­ally at our heart a brand builder as a com­pany. And so for us, it's about un­der­stand­ing this ex­plo­sion about dig­i­tal me­dia.

So how do we take ad­van­tage of this ex­plo­sion of dig­i­tal me­dia to present our­selves in new ways to new sets of con­sumers? How do we take ad­van­tage of the con­sumer com­ing back around to re­tail as an ex­pe­ri­ence, a cu­rated en­gag­ing ex­pe­ri­ence?

Re­tail is more than a search box and an al­go­rithm and free ship­ping, so how do we take ad­van­tage of that de­sire for more from the shop­ping ex­pe­ri­ence? We think about how brands are be­ing built dif­fer­ently in to­day's world. This growth of dig­i­tally na­tive brands, even China-di­rect brands, the very way in which brands grow up in to­day's world are chang­ing so we think about how do we use our plat­forms to go af­ter all those op­por­tu­ni­ties, lever­age our global scale and reach, our con­sumer en­gage­ment and our web prop­er­ties — but be will­ing to keep chang­ing.

And so our mantra is about con­stant in­no­va­tion, con­tinue to try to reach new sets of cus­tomers in new dig­i­tal plat­forms, be will­ing to try things, fail and move on, and con­tinue to deepen that prod­uct ex­pe­ri­ence and add more value to the con­sumer. It's re­ally been a fun time for us. It's been a dy­namic time for us. We're try­ing to re­lease new ca­pa­bil­i­ties on a weekly ba­sis to reach new sets of con­sumers and try­ing to reimag­ine what this busi­ness could be.

WWD: You an­nounced voice ac­ti­va­tion to­day. What was the de­ci­sion be­hind that?

M.G.: We re­leased a skill on Alexa for our HSN brand and we'll ex­pand that across our other brands over time. Alexa and its cousins, these will have a fun­da­men­tal change in the ways peo­ple will en­gage with brands over time. In many ways they are a voice ver­sion of a search engine.

Quite frankly they are not very friendly to brands, and they're not very friendly to the shop­ping ex­pe­ri­ence. And if you search a typ­i­cal brand term or fash­ion term on Alexa or on a mar­ket­place, you'll see what you get. So we wanted to change that equa­tion and we are about hav­ing a re­la­tion­ship with our cus­tomer and get her on a con­ver­sa­tion.

For us, con­ver­sa­tion com­merce is a log­i­cal ex­ten­sion of our core value propo­si­tion so we wanted to use Alexa to help the con­sumer search for in­spi­ra­tion rather than search for a prod­uct. So if you get an Echo Show as an ex­am­ple, which is an Echo de­vice with a video screen built in, you can en­gage with Alexa, you can bring in HSN, you can en­gage with our plat­form and search for those things you care about and be pre­sented with great, rich con­tent, live and on de­mand, that will help you have a deeper ex­pe­ri­ence with the brand. I think it's per­fect for use in our model, but we have to use it in a way that's right for us.

WWD: How do you judge the right time to go into con­ver­sa­tional com­merce? You don't want to go into it too early — and you made the point that you're not afraid to in­no­vate and fail, but you ob­vi­ously want to suc­ceed — so when's the tip­ping point? Is it the num­ber of users of the de­vices, or how does it work?

M.G.: I wouldn't say we have a re­ally sys­tem­atic view on that. We think a lot about our fly­wheel. We think a lot about how we cre­ate value and how these changes in the world re­ally in­ter­sect with that and stay true to the brand propo­si­tion, and then it's a mat­ter of what does it take to in­no­vate, how big is the change.

We talk a lot about shrink­ing the change so we can do some­thing that's rea­son­able in size, can be de­liv­ered quickly. And so we have been de­bat­ing voice-ac­ti­vated con­ver­sa­tional com­merce for prob­a­bly a year, and about three months ago, we said “OK, it's time to stop de­bat­ing it and just get a pro­to­type in mar­ket.” Part of the head-set change we've needed is we are so proud of our cus­tomer ex­pe­ri­ence, so proud of cus­tomer loy­alty and re­ten­tion that we've prob­a­bly erred on the side of be­ing overly con­ser­va­tive about giv­ing her new fea­tures and ben­e­fits be­fore we're con­fi­dent they're per­fect.

So now we re­al­ized we live in a world where we're go­ing to give her things that are im­per­fect, but ex­tend the ex­pe­ri­ence, and then we'll co-learn with her and evolve the ex­pe­ri­ence. I think voice com­merce

WWD: Was that new at­ti­tude to­ward try­ing things also part of the de­ci­sion to merge QVC and HSN into one busi­ness unit?

M.G.: It was. We ac­quired HSN in Jan­uary of this year, and we be­lieve in both brands. We will main­tain both brands, but when you think about the pace of tech­no­log­i­cal change, that goal to in­no­vate at a higher speed, we needed to fig­ure out what can we do to­gether in com­bi­na­tion that will give us the best of both brands and still main­tain the unique iden­tity of each brands.

We're bring­ing the two busi­nesses to­gether, main­tain­ing sep­a­rate brands, sep­a­rate cam­puses, but now we can drive in­no­va­tion on the dig­i­tal plat­forms, in­no­va­tions on mo­bile and in­no­va­tions on voice com­merce in a co­he­sive, aligned way. And we've also brought our mer­chan­diz­ing teams to­gether across QVC and HSN so we can re­ally think about a cat­e­gory and a cus­tomer and cre­ate the op­ti­mal as­sort­ment across both QVC and HSN in an in­te­grated way. Be­tween those two brands, we have five broad­cast net­works in the

U.S., so how do we make sure that all five net­works are en­gag­ing dif­fer­ent con­sumers with com­ple­men­tary propo­si­tions in prod­uct and pro­gram­ming. We needed to bring things to­gether to cre­ate that sep­a­ra­tion and com­ple­men­tary [prod­uct lines] across brands in the net­works.

WWD: When you're look­ing at all the brands, be it HSN, QVC or Zulily, and then the dif­fer­ent plat­forms and the dif­fer­ent de­vices that they're on, ob­vi­ously TV, mo­bile, desk­top, etc., does that dic­tate the dif­fer­ent pro­gram­ming that you're look­ing at? M.G.: To­day, we think more about cus­tomer jour­neys than about plat­forms, where is the con­sumer, what is she try­ing to do, what does the shop­per want to do, and how do we in­ter­sect that de­sire in a way that's en­gag­ing for her.

So we just find this in­fi­nite ar­ray of jour­neys that we can tap into, ev­ery­thing from I'm on Face­book and I'm in a com­mu­nity learn­ing more about beauty, and we can in­ter­sect that in­ter­est with our live beauty broad­cast chan­nel, Beauty IQ, which we simul­cast on Face­book live. We can en­gage her in that learn­ing mo­ment. We can take her to a site that doesn't have QVC or HSN on it, but is a mar­ket­place that has QVC, HSN or Zulily prod­ucts but un­der a dif­fer­ent so­cial plat­form, kind of a mi­cro brand, a so­cial brand.

If she is on YouTube, and she is fo­cused on the use pat­tern on YouTube, which is typ­i­cally learn­ing how to do some­thing new, and if she wants to learn how to fry a Turkey for Thanks­giv­ing, which I highly rec­om­mend, if you search how to fry a turkey with­out burn­ing down my house, we want to be there. We want to be there with re­ally great con­tent and, by the way, with some re­ally great turkey fry­ers. So what are all those oc­ca­sions on our in­ter­ac­tive TV plat­forms? We can present to her mul­ti­ple net­works, mul­ti­ple on-de­mand pro­gram­ming. So it's just about ►

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