Home Shopping’s Digital Evolution

Hulu veteran Eric Feng started Unboxed,
an app that taps into a social media
phenomenon known as “unboxing.”
Feng says unboxing content on
YouTube struck him as a “user-generated
evolution of QVC.”

A live video app that allows retailers to conduct “live sales” shopping shows. A new iOS app that’s calling itself the “QVC of mobile.” An app that lets shoppers explore what clothes it has available and make purchases via their Apple TVs. And a major acquisition in the traditional home shopping space.

These are just a handful of the key trends taking place in the home shopping arena this year. With Liberty Interactive Corporation (QVC’s parent company) acquiring the portion of HSN that it didn’t already own, and many new entrants testing the waters of live home shopping, this dynamic environment presents an interesting array of opportunities for marketers that want to rise above the clutter. 

John Kueber thinks he’s found a great way to do that. His Seattle-based video commerce company uZoom recently launched LiveShopCast as a way to power live video sales. Calling LiveShopCast the “first and only live shopping broadcast marketplace for e-commerce,” Kueber says the video platform fills a gap for sellers that want to hawk their wares directly from their video feeds.

“We solved that,” says Kueber, who adds that retailers and e-commerce firms can use the platform to launch broadcasts via their mobile phones, with sales processed on the company’s existing shopping platform (i.e., Shopify).

Kueber says the impetus behind LiveShopCast was “social” in nature, and that was originally designed to help consumers connect while also providing a live video-based sales channel. But as uZoom developed the idea and talked to its customers (namely, retailers in the Seattle area), it learned that they really wanted to be able to: 1) schedule a show; 2) integrate that show with their e-commerce platforms; and 3) interact more closely with their customers. 

“After hearing those ‘wants’ over and over again, we essentially launched our own home shopping network for our store,” Kueber says, “with the goal of being able to create our own show, select our products, and invite our audience to interact with us; we didn’t want to wait for a company like HSN to select us.”

Highlighting HSN’s limited, 24-hour broadcasting window, and the fact that the company has to be selective about the brands and products that it features, Kueber says his firm is focused more on “becoming the Shopify of live video.”

“Shopify empowered a bunch of stores to be able to launch an e-commerce store really easily and without any technical knowledge,” Kueber continues. “Essentially, that’s what we’re looking to deliver. And we’re doing that with an app where users can set up a show, invite their customers, have their products, and away they go.”

Getting in Front of People

Industry disrupters and innovators never have it easy, and uZoom is no exception. According to Kueber, one of his company’s biggest challenges has been simply getting people to wrap their minds around the fact that they can use live video to engage their audience. “Most people don’t immediately wake up in the morning and say, ‘Wow, I can’t wait to get in front of 100 people!’” says Kueber, who knows that public speaking isn’t a natural talent for most people. “If someone isn’t used to it, it can take a second for them to say, ‘I have the talent needed to get in front of people and talk to them about my products.’”

The second challenge involves the e-commerce platforms that LiveShopCast integrates with — or the lack thereof. Right now, for example, the company allows anyone to add their products by simply including a product link and that takes customers to product pages where they can check out. Kueber says his larger goal is to offer deeper integration with popular platforms like Magento, WooCommerce, and BigCommerce.

“We want to create a shopping experience that is even more seamless,” says Kueber, “where a customer is essentially adding to his or her cart and checking out all from the show, without having that extra step of having to go to the seller’s product page to check out.”

Home Shopping for Millennials

JTV’s success online has been astonishing. The company
closed its 2017 fiscal year at the end of June with a
7.6-percent bump in revenue, far outstripping national
projections for retail sales growth this year.

uZoom isn’t the only company that’s attempting to turn traditional home shopping on its head by adding digital, mobile, and social technologies to the mix. Gilt, for example, allows shoppers to explore available clothing, see 3D views from multiple angles, and make purchases via their Apple TVs. 

“The power of Apple TV is that it becomes another touch point in the company-consumer relationship,” Brightcove’s Albert Lai told Lifewire. “Retailers are also exploring the potential of the platform to improve their connection with customers. Many big brands are developing ‘how-to’ and product explanation guides for Apple TV.”

In San Francisco, former Hulu CTO Eric Feng recently launched the “home shopping network for millennials.” Known as Unboxed, the app taps into a phenomenon known as “unboxing,” where products get unwrapped and torn from their packages and shown to an online audience.

“Last year, for more than 52 consecutive weeks, the No. 1 channel across all of YouTube was an unboxing channel,” says Feng. “That just proves that unboxing is incredibly mainstream content.”

As Feng and his team began to peel back the layers and examine the unboxed content, they came to conclusion that what they were seeing was actually “a user-generated evolution of QVC.” 

“It is users having honest, fence-line conversations with their fans and communities about products that they’re very passionate about,” Feng explains, “in the exact same way that QVC hosts have those types of conversations about products with millions of people via their TVs.”

And with that, he set out to build a platform that was not only dedicated to that type of content, but would also help companies monetize that content (and their time), in “a different way than just advertising.”

For now, Feng says Unboxed is focused on the technology category, but he has ambitions to expand beyond that into beauty products and toys, which round out YouTube’s top three most popular unboxed categories. When shoppers open the Unboxed app, they can view top tech unboxing videos that have been curated into shows, live chat with creators and influencers to get their expert advice, and make in-app shopping purchases. 

Feng says Unboxed helps bridge the gap between online shopping (where consumers need to have at least an idea of what they’re looking for before they start their searches) and more traditional shopping venues (where shoppers can browse the options and discover new things they may not have even know they needed). 

“The ideas of QVC and home shopping are still very powerful because they deliver discovery,” Feng points out. “With online shopping, the customer has to have intent. With home shopping, someone can be enthusiastic about a certain product category (e.g., gadgets, gardening, or beauty) and can turn to QVC as a trusted source that helps curate the best products and then allows her or him to actually discover new things. We really want to bring that back.”

‘You Can’t Wake Up and Be Good at This’

Not to be outdone, the companies that helped pioneer the original “home shopping” channels are also making waves right now. In September, JTV® announced that its sales were so strong that they virtually “outstripped” the retail industry in the jewelry and gemstones category. Based in Knoxville, Tenn., the former Jewelry Television closed out 2017 (its fiscal year ended on June 30), with revenues that were up 7.6 percent over the prior year. By contrast, the National Retail Federation (NRF) expects overall retail sales to grow this year between 3.7 percent and 4.2 percent. 

During the most recent quarter, JTV posted sales growth of 5.1 percent year-over-year, while its closest home-shopping peers saw revenues fall around 4 percent from the same quarter a year prior, the company reports. Tim Engle, chief strategy officer, says the company has been able to successfully merge its traditional TV approach with the web, mobile, social, and platforms like YouTube to create the “go-to” shopping place for jewelry and gemstone shoppers. With all of its operations concentrated in Knoxville (with the exception of sourcing offices in Thailand, China, and India), the 1,600-employee, privately owned company prides itself in being flexible and agile.

“We’re not a public company so we’re not on the quarterly treadmill, having to answer to someone,” says Engle. “We’re also not owned by any equity funds or VCs, so we’re able to make investments and decisions on what we think are the best timelines, and those that best suit the company. I think these are all huge advantages for us.”

Also working in JTV’s favor is its commitment to a narrow product focus. “About 15 years ago, we decided to not try to be the No. 3 player in the space, always attempting to chase QVC,” says Engle. “Instead, we are No. 1 in our space. We claimed it and planted our flag.”

And because the retailer can offer upwards of 100,000 SKUs, it’s also beating out traditional jewelry retailers that can only inventory a small percentage of that volume. 

The company’s high number of SKUs help to satisfy growing consumer demand for more and more variety, says Engle — and the fact that buyers are more educated than ever. Concurrently, those shoppers are becoming more multi-device driven — a trend that JTV has responded to by making its sales platform as ubiquitous and device-agnostic as possible. 

“Part of our challenge has been keeping up with technology to ensure that we don’t have any preconceived notions about what devices our customers are using,” Engle explains, noting that about 65 percent of JTV’s unique visits come through mobile devices. “Just three years ago, mobile was less than 30 percent for us.”

Despite its obvious prowess on the home shopping front, JTV faces daily challenges in the selling environment, where shoppers are inundated by a growing number of channels, platforms, applications, and myriad other distractions. “We go after multiple consumers across different types of media,” Engle says, “but keeping this top of mind when you’ve got Netflix, Hulu, and all of these other streaming services out there requires a lot of effort.”

On the web side, JTV is feeling the impacts of the “Amazon effect,” which is shrinking delivery expectation windows and offering free next-day and second-day shipping. “We’re constantly reevaluating our business model based on the competitive dynamics,” says Engle, who is bullish on the future of home shopping, where companies already in the space have a leg up on retailers that haven’t traditionally used video.

“We’ve been doing video for 25 years, and leveraging our ability to educate, entertain, and transact using videos and video commerce; that’s an expertise of ours,” says Engle. “We tell a story, connect with individuals at a human level — versus a transactional level — which is much easier to do with video. As Amazon has proven (via a previous attempt to launch a home shopping channel), you can’t just wake up and be good at this.”

A More Multifaceted Approach 

QVC’s recent acquisition of HSN promises to expand its
power as a “multiplatform retailer,” as it likes to call itself.
The company contends that nearly half of its 2016 sales
were driven by e-commerce — and 63 percent of those
sales came via the mobile channel.

With $8.7 billion in sales for 2016 and a recent acquisition of HSN under its belt, QVC continues to reign as the top dog in the home shopping space, even if it doesn’t necessarily prefer that label.

“We don’t see ourselves as a home shopping brand, but rather a multiplatform retailer that is driven significantly by ecommerce in addition to our traditional networks,” says Mary Campbell, executive vice president of commerce platforms, noting that roughly half of the firm’s sales in 2016 were driven by e-commerce. “Mobile is a large part of this transformation, accounting for 63 percent of global e-commerce orders.”

Campbell, who wouldn’t comment directly on Liberty Interactive’s acquisition of HSN, says QVC takes a multi-platform approach and doesn’t segment customers according to their purchase habits (i.e., a TV buyer, a web customer, or a mobile shopper). That’s because customers tend to engage across multiple platforms with QVC, she says, which is focused on delivering a consistent brand experience at every touch point.

“That said, we do see more and more new customers and younger customers being introduced to the brand through digital,” Campbell says, “and customers overall are increasingly turning to mobile and ecommerce platforms.”

More Discovery Ahead 

With the need for discovery greater than ever — particularly in a world where online e-tailers like Amazon are shaking things up across many different industries — Feng says the live shopping platforms that can combine wide product selection and curation in a way that meets changing consumer demands will be best positioned for success. 

“The next generation of consumers may not consume the ‘discovery’ content on TV in a linear format,” Feng concludes “but they will need a way to uncover products. Because of this, there’s going to be a lot of value that can actually create the next format of QVC to help those users discover great products.”