QVC Inc., in advance of its HSNi merger seen closing later this year, has set a sweeping management reorganization and established a new business structure of the soon-to-be combined entity.
“Our new group will bring together QVC, HSN, Zulily and the Cornerstone brands to create a premier global retailer with extraordinary reach and unlimited potential,” said QVC Inc. president and chief executive officer Mike George.
The new organizational structure and senior team for the QVC Group will be effective once Liberty Interactive Corp. completes its previously announced acquisition of HSN. QVC, based in West Chester, Pa., is a wholly owned subsidiary of Liberty Interactive. HSN is based in St. Petersburg, Fla.
In addition, a new ventures division will be launched to drive “innovative retail concepts and seek growth opportunities through internal innovation, strategic partnerships, joint ventures and acquisitions.”
The changes, disclosed Thursday, are geared to accelerate innovation, extend the combined company’s global reach and strengthen its leadership, while also centralizing certain functions and cutting costs across QVC and HSN, leading to the departure of several HSN executives.
“I’d like to acknowledge and thank Bill Brand, Rod Little and Judy Schmeling, who comprise the office of the ceo at HSNi, who will be stepping down post the transaction closing,” George said. “They have steered the company well through the changes of the last several months and have been a trusted sounding board to me and our other leaders as we plan for the future. Each has made extraordinary contributions to HSNi.” Brand has served as president and chief marketing officer of HSN; Little has been HSN’s chief financial officer, and Schmeling has served as president of Cornerstone Brands and chief operating officer at HSN.
QVC’s takeover of HSNi was revealed last July, through a $2.1 billion all-stock deal. It came as no surprise considering Liberty had already owned 38 percent of QVC stock. The merger is seen as bringing together two relatively compatible firms with similar business models but distinct cultures and category strength. The challenge will be to share best practices without homogenizing the businesses and to take advantage of the greater scale.
According to George, QVC Group will generate $14 billion in annual revenues and will serve 23 million customers worldwide. QVC is considered the third largest multicategory e-commerce retailer in North America, behind Amazon and Wal-Mart. He said the group will broadcast 17 networks into more than 360 million homes in nine countries, attract two billion annual visits to its web sites, handle more than 180 million customer contacts and ship more than 320 million packages annually.
The new group will consist of five business units, including:
• QVC U.S.: Steve Hofmann, current president of QVC International, will be president. QVC U.S. is the company’s largest business unit with more than $6 billion in revenue in 2016.
• QVC International: A new leader for this unit will be revealed in the coming months. QVC International covers Japan, the U.K., Ireland, Germany, Austria, Italy, France, a joint venture in China. In 2016, the unit had $2.6 billion in revenue.
• HSN: Mike Fitzharris, currently ceo, representative director and chairman of QVC Japan, will become president. HSN last year generated $2.5 billion in net sales. Gregg Bertoni, currently senior vice president, CNR Mall, will succeed Fitzharris as ceo of QVC Japan.
• Zulily: Lori Twomey, currently chief merchant, will be interim president until a permanent leader is identified. Last year, Zulily generated $1.5 billion in revenue.
• Cornerstone: Claire Spofford will be president, while continuing to serve as president of Garnet Hill. Cornerstone, which includes Ballard Designs, Frontgate, Garnet Hill, Grandin Road and Improvements, generated $1.1 billion in net sales in 2016.
• CEO George also disclosed eight global functions for the group, creating a central team.
• Doug Howe will be chief merchandising officer of the combined company. He is currently executive vice president of merchandising for QVC.
• Mary Campbell will be chief interactive experience officer of Interactive Commerce Experiences. She is currently executive vice president of commerce platforms, QVC. Todd Sprinkle will be chief digital officer, reporting to Campbell and driving platform innovation. Sprinkle is currently chief information officer of QVC.
• Darrell Cavens will be president of new ventures. Cavens is currently president and ceo of Zulily.
• Bob Spieth will be chief operations officer, overseeing customer service, quality, supply chain and workplace services. He is currently executive vice president of customer and business services at QVC and Zulily.
• Beth Rubino will be chief people officer. She is currently executive vice president of human resources at QVC.
• Karen Etzkorn will be chief information officer. She is currently chief information officer at HSNi.
• Ted Jastrzebski, currently executive vice president and cfo, will be cfo.
• Larry Hayes will be general counsel. Hayes is currently senior vice president and general counsel, QVC.