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Mindy Grossman made an unexpected — though symbolic — move in her first week on the job at HSN.
“I tore down every parking sign that said ‘vendor’ and changed it to ‘partner,’” Grossman recalled. “It was indicative of the type of culture that we wanted to have.”
That was May 2006. Six years on and the chief executive officer has done more than just update the parking lot at HSN’s Saint Petersburg, Fla., headquarters. Grossman successfully revamped HSN from the ground up, not just giving the corporate culture a jolt, but also transforming the network from a cacophonous home-shopping channel into a dynamic, multimedia destination that perfectly blends commerce with entertainment.
These days, HSN features designers like Mark Badgley and James Mischka of Badgley Mischka, Rachel Roy and Naeem Khan, alongside celebrities such as Serena Williams, Iman, Queen Latifah and Mary J. Blige, who choose the network to offer a fragrance, apparel or, as is the case for recent addition Randy Jackson, a watch line. Performers like Lionel Richie and Rod Stewart have used the network to launch and sell their latest CDs, replete with a televised performance in front of a live audience.
“It’s about contextual commerce, something that’s going to create a connection with the customer because it either has a provenance or a story or anything else,” said Grossman, sitting in HSN’s modernist New York offices high above Midtown Manhattan.
The executive had a specific vision of what she wanted the network to be when she joined.
“Even before I met with Barry Diller [chairman and senior executive of IAC/InterActiveCorp] — at the time we were owned by IAC, so I was hired by Barry — I had in my head what I thought the business could evolve to,” she said. “I looked at it much less as a retail venue and much more as an information/entertainment/lifestyle venue, and that was really the genesis of what I felt the transformation could be.”
It’s hardly a surprise that Grossman felt so strongly about the need to tell stories beyond selling merchandise. Prior to joining HSN, she had already made her mark at Nike, where she was global vice president of apparel, and, before that, headed up Polo Jeans. Those experiences polished her strong sense for fashion and merchandising, and Grossman relied on them when, in the summer of 2007, she presented a complete overhaul of HSN from cool new graphics to fresh new sets and a widely enhanced hsn.com.
“What’s fascinating is that prior to August 2007, we didn’t have a single video on our Web site,” she said. “It was basically a digital experience of what didn’t sell on television. We weren’t even maximizing the fact that we could have this network amplification, but we also didn’t have the content to really leverage it.”
So, simultaneously with the relaunch, Grossman embarked on a mission to reevaluate the vendor matrix, nixing some existing brands and businesses that didn’t fit in with her new strategy and bringing in new ones. As she put it, the strategy was to “start building the pipeline in every one of the categories and redefine what authority meant in those categories, whether it was beauty or culinary, fashion or electronics.”
She diversified the portfolio, amping up the fashion and beauty categories and bringing in well-known names in the kitchen and food area. Her criteria was the same for each.
“The first thing is great product,” she said. “Is it relevant? Is it differentiated? Is it something that can strike a chord? If you don’t have the ability to talk about this for at least seven minutes and make it exciting and compelling, it doesn’t belong in our environment. It’s great product, great story and great storytelling.”
As if to drive home the message, she picked up a candle from the coffee table and exclaimed, “You could talk about a scented candle for eight hours if you were passionate about it.”
Her formula has proven a hit. In 2008, HSN Inc. was spun off from IAC, and today, it’s a stand-alone, publicly traded, $3 billion multichannel retailer. Even with her success, Grossman’s not one to rest on her laurels.
“Today, you have to have more than just a transactional mentality,” she said. “We want to really understand as much as we can about our customer so we can give her content and products and experiences that are very aligned with what’s going to make her life better.”
More recently, the evolution of the Internet has given the strategy a significant boost.
“Today, we can leverage that content across every screen that we have,” Grossman said. “We have the capabilities because we’re a television network to create original content that’s only available digitally to enhance what we do. If you look at our iPad application, you can customize your own channel. If I like cooking, I can create Mindy’s cooking channel, and every time a cooking video comes out, it comes into my channel. You were never able to do that.”
Vince Camuto, who sells shoes, accessories and fragrance on the network, called Grossman “a true innovator in the business.”
“She has already achieved tremendous success with HSN and has positioned the brand for multichannel growth through significant investments in the digital space and a fresh approach to product and partnerships,” he said.
Badgley Mischka offers the American Glamour Badgley Mischka line on the network, which aims to translate the brand’s glamour quotient beyond the red carpet into everyday life.
“We didn’t know what to expect,” recalled Mischka. “We went from Tampa, where the show was shot, to Palm Beach, and people there started recognizing us. It has such a reach, which was really surprising to us.”
Mischka first met Grossman nearly three decades ago, when she headed men’s sales for Williwear Willi Smith and he was head of men’s design.
“Her capacity is amazing,” Mischka said. “The word ‘no’ doesn’t exist with her. She looks at everything from a fresh point of view. She doesn’t look at it from just a tried-and-true merchant-vendor relationship. She has a wide reach of looking at things, which we find very useful and very refreshing.”
Richard Graziano of jewelry firm R.J. Graziano said, “We all expected changes when Mindy first started. What we got was the ultimate, supersparkling makeover.”
The evolution continues and Grossman is brimming with ideas for HSN Inc., the network’s parent.
“We’ve made decisions to divest of some businesses, like a Smith & Noble [home interiors firm], and you’ll see some of that,” she said. “We made our first acquisition of Chasing Fireflies in the children’s space because it lines up with this aspirational family lifestyle. There’s potentially technology businesses that will enable us to do more content or different things. There are things in what I call the ‘gamification’ world, married to social media, that could be very interesting and would enable us to do new things.”
She called this “the most exciting time in the history of our company.”
“We’ve fixed the fundamental foundation, we have a strategy that’s working and we’re in an environment where technology is enabling us to be so much more than we could ever be,” Grossman added.