Retailing Through Television

Supplemental to the printer version of this feature, Michael Henry, senior vice president of beauty merchandising, HSN, shares his thoughts on retailing on television.

What are the implications and impact of television shopping channels on brands?

Michael Henry: In addition to HSN being a sales outlet, brand’s exposure on HSN serves as a valuable marketing platform. This can be a valuable tool in establishing an international brand in the U.S., thus avoiding the high cost of advertising and setting up a sales force. For example, recently HSN had the exclusive U.S. launch of Art Deco, a prestige beauty brand in the German market.

Major brands also benefit from being on air with HSN, as we recently experienced with Lancôme’s most recent launch of Genefique. In one day, more than 7,000 units were sold, but more importantly for the brand, Lancôme was able to speak directly to more than 92 million households and give a detailed presentation of how the product works and demonstrate the benefits directly to the consumer, which in turn drove traffic in to [other channels].

What is the impact of television shopping channels on packaging and brand identity? On physical shelves, packaging helps communicate the brand message and make that first sale. Do brand owners need to consider packaging differently when a product is retailed online? If so, how?

Michael Henry:There is an old saying in retail, “the sale is never over.” A good merchant looks at each interaction with the consumer as an on going relationship. Some brands cut back on packaging for goods that are going direct to the consumer. At HSN, we try to discourage this approach. We want to make sure that when the consumer receive goods at home, we exceed their expectation. And, of course, the packaging plays a critical role in how brands and HSN are perceived.

How does the task of reaching out to consumers and fostering a brand/consumer connection differ when the brand is offered via a television shopping channels?

Michael Henry: HSN places a great amount of emphasis on the selection, training and monitoring of our customer service representatives. The emphasis has to be the customer always comes first, and we want the experience to be efficient, informative and friendly. Many of our customers have such positive experiences with our service representatives they frequently ask them for advice on a selection.

On air is another opportunity for our customers to form a connection with HSN, as we have a range of hosts with completely different backgrounds. Consumers will often tune into shows presented by their favorite and trusted HSN host. And we have a comprehensive database on our customers’ preferences, and if they wish, we can communicate with them directly, keeping them abreast of new brands, events and specials they might be interested. It is really like have a personal shopper.

What is the most effective approach to transitioning from a brick-and-mortar store to a television shopping channels? What are the challenges?

Michael Henry: It is critical to select product that can benefit from the medium; therefore, we are always looking for unique items that are highly demonstrable on air. As for challenges, if a brand or product is broadly distributed, the shop at home customer most likely will not be motivated to purchase, as it is already easily available and there is no waiting or shipping and handling costs.

There is potential for reaching a much broader market when retailing through television shopping channels. How must a brand owner who also retails her product prepare to deal with a far more widespread consumer base? What are the practical issues? Shipping, payment methods, etc.

Michael Henry: Due to the airtime allocations, the product assortment is driven by a few key items, much more narrow and deep than a typical retailer. The response to untested items can be volatile and sometimes hard to predict; therefore, in a perfect world, it is ideal for brands to have back up quantities. Of course the flip side, one may not get the response anticipated, ending up with excess quantity in one item vs. a wide assortment.

How can a brand manage its image and positioning when on a television shopping channels? Are there virtual equivalents to the POP, display kits and shelf displays that brands often offer to brick-and-mortar retailers?

Michael Henry: At HSN, we work with the brand partners to understand what are the critical elopements to communicate the brand’s positioning and how best to convey that in our shows and on line.

Michael Henry