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Television and online shopping giant QVC (QVCA) is launching in its seventh country today: France. The company made $8.8 billion in revenue last year and is in more than 300 million homes around the world.
But QVC had humble beginnings and was late to the game when it launched in 1986 following a spate of similar businesses into the space. Since then it has left the rest in the dust now competing instead with the likes of retail giants like Nordstrom (JWN), Sephora, and increasingly, Amazon (AMZN).
“We find that we can compete against those retailers with a unique experience that's more about the connection, the inspiration, the discovery process,” says CEO Mike George, adding, “We really don't, at the end of the day, care about getting the next sale from you...if we over-hype a product, you get it home and you're disappointed with it, we're gonna lose a lifetime customer.
Instead the company focuses on ways for people to use the products it sells and hopes that will spur sales to the very people it thinks would enjoy the item.
One set of consumers they aren’t targeting? Millennials. While just about every other business is obsessed with appealing to the under 30 set, QVC acknowledges that Millennials simply aren’t their demographic
“What we find is that people tend to, kind of, acquire QVC typically when they move into their 30s,” George says. “So you start to see...our business start to pick up with folks of that age, probably continuing into their forties and fifties.”
Ken O’Brien is the company’s Senior Vice President Merchandising and is the man in charge of finding the products those QVC customers want. “We're all always looking for really relevant product,” he says, “product that's got a really great story often with a great storyteller, an inventor or an entrepreneur that brings us something that's really relevant.”
One such product is a portable power device to recharge your phone called Halo. Walk into any electronics store and you can find several different brands that all do the same thing. But QVC’s audience is vast and apparently different from the consumers that frequent those stores - so much so that Halo broke the one day QVC sales record in 2012.
“We sold 305,000 units in one day at QVC,” says Gerrold Miller, Halo founder and CEO. “And then we came back the next year-- in 2013 and we sold 380,000 sets of two Halos in one day.”
In fact, the small startup has had so much success Miller estimates they do 90% of their business with QVC.
And while technology like Halo sells well on QVC it’s new technology behind the scenes that has helped keep the company so dominant.
When it launched in 1986, Mark Zuckerberg was just getting out of diapers and Apple was three years away from releasing its first portable computer.
QVC was entirely dependent on the telephone for orders and connecting with customers on air. While both are still a part of the QVC experience Facebook, Twitter and Instagram bring customers closer to the product and the QVC hosts while online and mobile purchasing has changed the game.
Online sales are now 47% of the companies business here in the U.S. and mobile orders account for 52% of that. But expanding online means having to compete with the king of the space - Amazon. That is something Alex Miller, QVC’s Senior Vice President Digital Commerce isn’t concerned with.
“Our target market are customers who look at shopping as entertainment,” he told us. “So as I would look at ESPN as a way to consume sport content and every aspect of it. Our customers come to us to engage in shopping in more of an entertainment format. And so, I encourage our team to stay focused on where we have our strength which is in creating entertainment and social interactions around the shopping experience.”
But QVC is still careful not to depart too radically from the medium that put it on the map.
“The rise of mobile has given us an enormous platform to connect with people that probably had not engaged with us in the past.” CEO Mike George says. “But TV is relevant. TV is still at the foundation of what we do. Because what we can do with that unique TV asset that no other retailer has, is to reach into 300 million homes around the world and tell really engaging stories.”
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