WWD.com/business-news/technology/home-shopping-poised-for-growth-1157439/
government-trade
government-trade

Home Shopping Poised for Growth

NEW YORK -- Experts from designer Bill Blass to communications giant AT&T to the marketing gurus at Management Horizons predict home shopping will expand and solidify its share of the $2 trillion retail marketplace in record time.<BR><BR>Their...

NEW YORK — Experts from designer Bill Blass to communications giant AT&T to the marketing gurus at Management Horizons predict home shopping will expand and solidify its share of the $2 trillion retail marketplace in record time.

Their comments came at a symposium on televised and PC-based interactive home shopping called “Retailing 200: Mall or Monitor.” The program, sponsored by the New York chapter of the International Furnishings & Design Association, was held at the Waldorf-Astoria hotel here last month.

Dan Sweeny, vice-chairman of retail services at Management Horizons, said stagnant sales and saturated markets are forcing conventional retailers to look for unconventional ways to expand their businesses.

“The most powerful force propelling the electronic shopping industry is the relentless search for incremental sales by the conventional retail industry,” Sweeny said.

The current evolution of home shopping supports that argument, as retailers like Macy’s and Saks Fifth Avenue and successful catalog-based merchants like Eddie Bauer and Spiegel’s are or shortly plan to begin hawking their wares over the TV.

Sweeny said the proliferation of cable channels and the promise of interactive technology will help home shopping grow.

“Growth will come at the expense of catalogs and specialty retailers,” he said.

QVC and the Home Shopping Network are both billion dollar companies already, according to Sweeny. The home shopping industry as a whole, infomercials included, saw sales of $4 billion in 1992, according to the most recent figures compiled by Management Horizons. Sweeney expects the industry to grow by an additional $8 billion by 1996 and reach $60 billion by the year 2000. That figure will nearly double to $112 billion by 2004 and will swell to “some $400 billion” by 2010, when it will account for 15 percent of non-auto retail sales, he added.

Interactive shopping, which will allow consumers to place an order through their TV remote control or PC will fuel the growth, according to Sweeny. “The infamous Generation X has been honing its skills on video games and is fully ready to handle interactive shopping,” he said.

Bill Doddridge, vice-president of global information services at AT&T, said the two-income family will also spur home shopping. AT&T has invested heavily in the infrastructure for interactive home shopping .

“Because of the growth of the dual-income family, consumers have more disposable income and less time to spend it,” he said. “The length of the average shopping trip has already decreased as people try to balance shopping time and leisure time.”

Harlan Bratcher, senior vice-president of Q2, QVC’s new lifestyles format, is attempting to make those busy individuals regular customers by providing what Q2 feels will be more interesting programming.

“Half of all sales on home shopping channels are jewelry,” he said. “The ring is turning and turning and turning, and viewers keep clicking and clicking and clicking. We’ve got to catch those channel surfers.”

The topical programs will air at regularly scheduled times to encourage repeat viewing. “If you tune in at 10 a.m. on Sunday morning, you know you’ll see something about the home,” he said. “You won’t see a ring turning.”

Following a trend in the home shopping industry, Q2 will offer some star power. Actress/model Isabella Rossellini will host a segment called “Home Styles With Isabella Rossellini.” As a “contributing editor,” Rossellini will appear about five times a year.

Designer Bill Blass has already lent his name to Springmaid home fashions sold on QVC. And other notables from TV’s Joan Rivers to “cheap chic” designer Diane von Furstenberg and even Ivana Trump are already hawking products on TV.

Blass said he had his reservations about selling on QVC, only to find his personal appearances were very successful.

“I was hesitant about going on the bloody thing to begin with,” Blass told an extremely amused crowd. “But I saw how excited Ivana got about selling clothes. Now I have the same enthusiasm about selling sheets.”

The QVC set got the designer touch when QVC finally cajoled Blass into appearing.

“The set was appalling,” he said. “I spent my first hour rearranging the palms.”

HSN actually has a vice-president in charge of celebrity marketing: John Pinocci. He said HSN first brought celebrities on the show to draw channel surfers but added that their role soon changed.

“At first we would have somebody like Gilligan, a.k.a. Bob Denver, sit down next to our host,” Pinocci said. “He was there for entertainment — to pull in the channel surfers. He had no connection with the product and no knowledge of the product.

“But when we got Bob Eubanks to come on the air, he turned out to know a lot about Native American artifacts. Now he goes out and sources those products for us. Today, we are using people who are synonymous with their products. People like Ivana Trump, Bob Mackey, Diane von Furstenberg and Bill Blass.”