QVC 101

Adapting to the New Shopping Paradigm

QVC 101
December 1, 2016

The shopping channel QVC was born in 1986 and has been a staple of cable television packages for many years. Named as an acronym for Quality, Value, Convenience, QVC has continued to thrive even though cable subscriptions are declining and cord cutting is gaining in popularity. How have they managed to sustain their success?

One reason is an "E" that should be in their name, for Entertainment. QVC has always had well-known host personalities such as Kathy Levine and Lisa Robertson who have bonded with the public and generated fans of their own. Their techniques such as countdowns on deals and effective peer pressure from satisfied shoppers who are interviewed on air appeal to a mostly female demographic that views shopping as entertainment — a demographic that also has the money and the desire to follow through with purchases.

As a result, QVC has accumulated quite a loyal following over time. 90% of QVC's business is via repeat shoppers and the average QVC shopper buys between 22 and 25 items a year.

Meanwhile, QVC has adapted very well to digital shopping and the use of online and mobile apps, helping it to gain a presence beyond its cable base. QVC has been well positioned for this strategy from the beginning. It has always kept real time information on sales to implement their countdowns and pressure tactics ("Only two left in Size 5!") and thus has excellent information on what will sell and which sales techniques are effective.

QVC now has a significant Internet presence as well as a mobile app that allows shoppers to "multi-screen," or use computers or mobile apps to order what they are seeing on the screen in real time. Thanks to this strategy, QVC's online sales have grown from 29% of total US sales at the end of 2009 to 51% in the second quarter of 2016. Internet Retailer notes that QVC has risen to fifth place in sales for mobile commerce retailers, and their mobile sales income this year is expected to rival that of WalMart.

QVC is great about getting people to shop not just online, but also to follow through with purchases. Their methods of real time purchases are now supplemented by a platform that allows shoppers to buy items that are not currently on the TV screen. Unbelievably, between 60% and 70% of orders placed via desktops and tablets are for items that have not been shown on TV in that same day.

Their cable base is still quite substantial, as QVC is currently available in over 98 million homes in the US. However, with the apps and online ordering infrastructure in place, QVC is well positioned to take advantage of a shift. The demand for QVC means that some cord-cutting group will offer them as part of whatever replaces cable, whether it is a streaming service or some technology yet to be invented. Just as Internet ordering replaces the telephone-ordering element, a new visual method of reaching their audience will eventually replace QVC's cable method of reaching their customers.

QVC also has an international presence, with approximately one-third of its revenue coming from seven countries beyond the US market. They already enjoy a relatively mature presence in Japan and entered the market in China last year — perfect timing as China shifts toward a consumer-based economy.

Expect QVC to survive and thrive well into the future for two main reasons: their ability to adapt to circumstances and their methods of growing and maintaining a loyal customer base. That is a great formula for success in any industry.


Photo ©QVC Headquarters

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Erin | 12.01.16 @ 16:16
Wow. I had no idea QVC has been doing so well. Good for them for being able to compete with Walmart. It is not a company that I have done a lot of business with over the years, but I suppose if they are offering convenience and competitive prices, they will be hard to beat. I'm looking forward to seeing how they take advantage of the coming shifts.
Carla | 12.01.16 @ 16:23
QVC has been around as long as I can remember. With cable and satellites expanding channels I am a bit surprised that they are still doing so well. They are surely doing something right.
Daniel | 12.01.16 @ 16:28
Though i am not a customer of QVC i know some people that are and swear by it. they do put on a good show while they sell as well
Zanna | 12.01.16 @ 16:55
I have never understood the appeal, but I am married to a guy who would believe most of that sales hype instantly and be ready to buy every product they sell. There's a reason that channel has a parental block on it, lol!
Brittany | 12.01.16 @ 17:35
I used to order QVC a lot a few years ago, mostly because it's a company that my mom used to order from a lot when i was younger. I never realized how well off they were still doing! I think that's awesome.
Chrisitna | 12.01.16 @ 19:06
Smart move, QVC, to already have things in place for a shift to more online business! I don't view shopping as entertainment, but have several friends who have been enjoying and purchasing from QVC for years - they definitely are doing something right!
Crystal | 12.01.16 @ 20:20
I honestly didn't know QVC was still around. But kudos to them for maintaining a loyal customer base and surviving Amazon! Other companies could take a note from their playbook.
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