Lights, Camera, Retail
By Tom Ryan
While Madonna heads to Macy’s to launch her first fashion collection,
Mariah Carey has chosen HSN. The singer’s first lifestyle collection, including
jewelry, shoes and perfume, represents the latest coup for HSN CEO Mindy Grossman
in her mission to upgrade the drab reputation of television shopping.
Since
joining HSN in 2006, the former Nike and Polo executive has brought in a number
of celebrity-endorsed lines, including ones from Venus Williams, Liza Minnelli,
Twiggy, Wolfgang Puck and Mary J. Blige. But she’s also raised the overall
quality and cachet of product across the line. That included gaining big names
from the fashion world such as the American Glamour line with Badgley Mischka,
Curations with Stefani Greenfield, a lifestyle line by the Scoop founder, and
new fragrances from Sean Jean.
Part of her job was convincing many of these
high-profile celebrities and designers to sell their wares on a channel once
known for pushing Suzanne Somers’ ThighMaster. According to a profile on the
company in Bloomberg Businessweek,
studio sets were streamlined, green rooms spruced up, and full-time make-up
artists and hair stylists were hired. Andrew Sheldon, a British television
executive, was also hired to coach the hosts on their presentations.
“Before, there was a lot of finger pointing. They spoke too quickly
and too loudly,” said Mr. Sheldon. “Selling doesn’t mean you have
to shout ‘Buy it! Buy it!’”
Recognizing that her competition was not so
much retailers, but lifestyle television networks such as the Food Network,
Style, HDTV and DIY, studio sets were upgraded and more time was spent finding
the right on-air personalities and coaching them.
“If they don’t want to go on air, then they don’t want to work with us
— they’re not passionate,” Ms. Grossman told Bloomberg Businessweek. “The
whole idea is to bring more than just a product. It’s to bring a voice. Their
personality has to show through. I keep telling people that it’s a trunk show
in 93 million homes.”
The final step was to improve customer service. According
to a Footwear
News profile,
that included bringing 100 percent of its call center force back to the U.S.,
elevating their pay scales as well as improving quality standards down to the
packages received by customers. Notes are now sent to best customers. In 2009,
HSN ranked in the top 10 in the American Express/National Retail Federation
survey of best companies for customer service.
“We have a mechanism we use where if a product triggers on three different
measures — returns, customer-service complaints and reviews — we
immediately pull the item off the website and stop selling it,” Ms. Grossman
told Footwear News.
Despite the downturn, HSN’s sales grew three percent in both 2008 and 2009.
HSN did $2 billion in sales last year.
Ms. Grossman recently told stylist.com, “The
most important thing was getting that gravitas credibility in each of the categories
of what was a great product and what was a great story and who were great storytellers
… because it’s about authenticity, too.”
Discussion Questions: What do think of Mindy’s Grossman’s strategy to improve
the shopping experience at HSN? What else could help television shopping broaden
its audience?
- Birkin or Beckham or Both?… Mariah Carey’s Designs… – Women’s
Wear Daily (sub. required) - Q&A With Mindy Grossman – Footwear News (sub. required)
- HSN’s Fashionista – Bloomberg Businessweek
- HSN Evolves into Storyteller of Shopping Channels, Driven by CEO Who’s Her
Own Biggest Customer – stylist.com
Television retail appeals to a very niche audience that might not yet know about Al Gore’s discovery of the internet and shopping online!
Whether the Mariah deal is a good idea or not, Mindy Grossman has completely transformed HSN and raised the bar incredibly high for the medium. Mindy was on our “women to watch” list while she was at Nike and I couldn’t wait to see what she would do once she ditched that boy’s club after being passed over. Much like Micky Drexler’s move from Gap to J. Crew, Mindy evidently had to make a jump in order to really shine. HSN is a real force in retail now and they have her to thank for that.
The marriage of celebrity and retail is made in heaven.
Using this approach, there is the opportunity to really reach into a psychographic target–with a cultural idol, and of course, the merchandise and souvenirs to match. Take the celebrity experience home!
The marriage benefits both parties and adds sizzle and fun for shoppers. Win, win, win. We’ll see more of this.
Television retail can move massive amounts of product, and can generate huge buzz for the right designers. While it is a niche, it is a hugely profitable one. Kudos to Mindy for taking steps to deliver a quality retail experience.
Once known as a great source for figurines and CZ, Mindy has transformed HSN into a very viable channel of retail distribution. Given the growing access to TV–laptops, smart phones, etc., she is also on the right side of the technology curve relative to 4-wall. This is a winner.
Looks like she is making good strides within today’s definition of “TV shopping.” Some real challenges to this market are on the way with iTV, video content being used to sell on eCommerce sites, social media, and the democratization of video content creation. The TV shopping channels have some unique advantages going into this new world, but also some potential big pitfalls.
I think the combination of entertainment, celebrity and shopping (particularly in the comfort of your own living room) is brilliant. I have always felt that there needs to be a higher “entertainment” quotient to home shopping, and celebrity certainly fills that bill. However, there will continue to be the challenge of how to keep consumers on that channel if they tire of whoever is chatting away about their products.
TV shopping must raise the bar on entertainment in order to keep capturing the numbers they are aiming for. I would think this opens up a whole new category of TV show/entertainment/advertising, one that someone is going to figure out. Way to go, HSN, at least you’re thinking ahead.
I say, Go Mindy! That entire network was a gem waiting to be discovered by someone, and she’s the perfect match. You have to give their board credit for going with someone who was not necessarily apples to apples. I always think about the Beatles in that sense; sure, they could play, but so could thousands of bands…but someone saw that they had magic for the masses. And there in lies the genius–matching talent with a bigger, not so obvious job. Anyway, I digress!
I hope she continues to take it up a notch, including connecting more with the digital side and maybe more importantly, the product innovation element. It sure seems like she’s on the right track.
Upgrading the celebrity list would seem like a no brainer. Whether product quality has improved is another question and one that cannot be accurately answered by looking at a TV screen, even in high def.
Unfortunately, even with all the upgraded training hosts and personalities are given, this remains a medium of largely selling through pandering to a naive customer base.
The other afternoon I was channel surfing and came across an HSN host selling an HDTV. At first glance I noticed that it was a 32″ set with a built in DVD. The price was $499. This seemed a remarkably high price in this day and age so I turned up the sound and listened for the pitch. It was pushed as a seventy year old brand name. The host pushed the idea that one of the available colors was white and this color ‘might not’ be easily found in stores (likely for good reason). The host went on to sell on the ease of a DVD which needs no installation (pandering as a neighbor’s child can attach a DVD player in a couple of minutes if the customer is intimidated). She then failed to anticipate that after inserting the DVD one must still push the right buttons and wait for the disk to load (the pleasures of live TV).
The type of high def was conveniently not discussed nor shown during the considerable portion of the presentation I viewed. My investigation uncovered it to be 1080i which is inferior to 1080p as a previous presentation for a 1080p set previously noted.
All this for an overpriced TV. If the product received is defective, the customer must repack the product and send it back via a trip to a line in the post office. Postage is not cheap here.
For clothing, buying brick and mortar is superior as you can see the fit, feel the quality of the material and judge the comfort before buying, thus avoiding many returns. This is especially important in shoes where sizes can vary slightly by brand and style.
A host on a competing network directly stated that TV shopping for electronics is superior to shopping at a brick and mortar as in-store sales people will push products with features you don’t need to gain a higher priced sale. I find this to be less and less true as the customer is best armed if equipped with research and competitive offers. TV offers one product at a time, pushing all the pluses and avoiding the negatives. Watching a later presentation of a similar product can reveal the flaws of the product previously promoted.
Part of my job is observing merchandising techniques and efficiencies in various retail platforms. In my opinion, when shopping on TV it’s buyer beware.