With revenue up at QVC’s domestic and international operations but falling 11 percent at HSN, it’s a mixed bag for now as the recently rebranded media conglomerate continues full speed ahead on its turnaround plan. Qurate, which earned $3.2 billion for the quarter, recently hired a slew of fresh faces to steer the ship, including Mary Campbell as chief merchandising and interactive officer, Aidan O’Meara as lead for QVC International and former Amazonian Jeff Yurcisin scheduled to “take the reins” at flash-sale firm Zulily.
Long a mainstay of middle-class moms, home shopping needs a facelift if it wants to win over a new generation of customers more interested in tuning into YouTube than picking up a television remote. Qurate’s companies are trying new approaches to connecting with millennials and Gen Z.
On an analyst conference call, CEO Mike George said that QVC USA’s inaugural Black Friday in July event was “targeted at a fundamentally different kind of customer” with a half-day of live programming made just for digital platforms. Five million consumers tuned in over Facebook Live, an eightfold increase over typical viewership, George noted. What amounted to QVC’s “highest single-day customer acquisition of the month” also drove incremental sales.
“We’re really analyzing the impact of that program, what kind of customers it brought in, what kind of repeat purchase will they have,” George said.
The numbers point to Qurate’s digital investments bearing fruit. George said the company saw a twofold year-over-year increase in live and on-demand video viewing minutes for mobile, desktop, over-the-top services like Roku and Apple TV, and Facebook Live.
In addition to bringing back customer favorites like Jones New York and Born, and introducing new-to-Qurate brands like Anne Klein and Dooney & Bourke, the home shopping giant announced plans to build its own private brands with an in-house design, development and sourcing team.
“They’ve had tremendous success building the strong proprietary fashion business at QVC, and we see great opportunity at HSN where the fashion category has much lower penetration,” George noted.
With new products in the works, will Qurate also tweak the programming format? On QVC, the “Today’s Special Value” product offer serves as the foundation for the day’s schedule—but hasn’t changed significantly in decades.
Qurate’s home-shopping brands might not have the most future-forward image but their ability to move major quantities of product is not in question.
Gretel Going, founder of jewelry brand Fortune & Frame, said that although her line had previously been picked up by the likes of Harvey Nichols and Anthropologie, those retailers weren’t placing significant wholesale orders.
Although initially she wasn’t sure that QVC was the right fit for her up-and-coming jewelry brand designed for the 18- to 45-year-old demographic, a bit of digging put the jewelry designer onto Spanx and other brands she respected that had leveraged home shopping to their advantage. “TV is still such a massive channel, and it’s difficult for brands to get access to earned national airwaves,” Going said.
With three QVC appearances now under her belt, Going said the network’s initial order for 1,700 pieces has since increased with additional stints on the show.
George said President Trump’s trade war has to date has a “fairly modest impact” on Qurate, with home goods affected and beauty products subjected to “retaliatory EU tariffs.”
“If we were unable to mitigate any of [the tariffs] through pricing … you’re probably talking in a $10 million to $15 million range in the back half,” George said. “A real number, but not massive given the size of our earnings.”