QVC DIGITAL REBOOT
Channel gets people to buy, not just browse, on devices
In Control Room A at QVC’s studios in West Chester, Pa., line producer Sean Hagan is perched behind five computer screens in a setup that looks more NASA engineer than retail sales analyst.
Some screens show him what viewers are seeing or will see live on the home-shopping channel; others display constantly updating data: how many items have sold online or over the phone in various sizes, how many remain in stock, how many phone calls have come in the last 10 seconds, and more.
That attention to data may explain why the 24/7 pageant of panini makers, flameless candles, anti-aging creams and ankle boots has, despite QVC’s fusty reputation, quietly outmaneuvered other retailers in remaking itself for the digital era.
QVC has seen online sales soar to 45% of its total U.S. sales by trailblazing on one of the most vexing challenges in retail today: getting people to buy, not just browse, on their phones and tablets.
With a strategy centered on “second screening” — the tendency to watch TV while also swiping and tapping on a gadget — QVC has become the fifth-largest mobile commerce retailer in the United States, according to an analysis by the trade publication Internet Retailer. In fact, it is projected to ring up a mobile sales haul this year that is nearly as large as WalMart’s.
As shoppers get more hooked on their mobile devices, the entire retail industry is scrambling to find ways to better integrate app usage with more traditional shopping experiences. So QVC’s early lead in this format could prove crucial to securing its future. And with the crucial holiday shopping season around the corner, it may be its best bet for luring new customers and turning them into QVC devotees.
“We came to appreciate the fact — maybe the obvious fact — that people lead busy lives. They’re engaged with multiple devices at one time. No one’s just watching TV anymore,” QVC Chief Executive Mike George said.
When the iPad was introduced in 2010, that was a game changer, said Alex Miller, QVC’s senior vice president of digital commerce. “That device, in particular, was a natural place to apply something that was really core to our business model,” Miller said.
And that’s when QVC doubled down on designing a user experience that was tailored not so much for shopping on the go as for shopping from the couch. Today, when you open the QVC app, you instantly see the item that is on-air at the moment. Just below that, there’s a prompt that allows you to quickly find everything that has been on TV in the last several hours.
The shopping channel has also moved to make it especially easy to make a purchase on a small screen. (Many retailers have found that mobile shoppers get turned off by checkout processes that involve too much typing.) If you have a QVC account and an Apple device equipped with Touch ID, you can check out in less than 10 seconds by hitting the “Speed Buy” button and then letting the app scan your fingerprint. To get customers comfortable with the new technology, the network ran segments onair featuring QVC host Antonella Nester explaining how to use it.
The app is also QVC’s bid to lure cord-cutters because it includes access to the network’s full slate of live programming.
These efforts have helped QVC’s mobile sales grow to 40% of its e-commerce sales, an unusually big share at a time when many retailers still find shoppers largely engage with them on these devices to scan prices or check store hours.
QVC has also moved to rethink its merchandising strategy and amp up its communications with customers.
Electronics have become less of a focus as it has become easier to find and price-compare such items on the Web.
QVC has also become less reliant on jewelry and is placing more emphasis on beauty products and high-end kitchen appliances. Martin Pyykkonen, an analyst at Rosenblatt Securities, said this merchandising shake-up has been a smart move.
“Frankly, the margins are considerably better,” Pyykkonen said.
In these and other categories, QVC is focused on providing exclusive products, meaning an item sold only on QVC or offered in not-otherwise-available colors or packaged with special extras.
QVC is also experimenting with commissioning some fast-fashion apparel that would allow it to lean in more quickly to new trends.
All of these changes are aimed at sustaining QVC’s staggeringly loyal customer base: 90% of the company’s revenue comes from repeat shoppers, and its average shopper buys 22 to 25 items a year from QVC.
That is why the company has invested heavily in new ways of reaching customers, such as something called the “post-purchase video.” QVC has created a stable of Web-only videos on such topics as how to assemble a Dyson vacuum cleaner or four ways to style a scarf. On the day it expects a product to show up on a customer’s doorstep, QVC will automatically email her the related how-to video.