Power of ‘T’ (V) Commerce
TV has come a long way from the days of cathode tubes to the current host of sleek, thin, flat and smart brigade. With the evolving consumer shopping preferences, TV industry, too, has adapted to the shift as there is a huge opportunity for commerce. Apart from selling apparels and household products, these TV shopping networks today are selling jewellery as well. In a country like India where television is still a big thing, selling on TV can be a great opportunity, finds out Kavita Parab.
It may be the time for Netflix and Amazon Prime, but that does not mean that there is no television viewing happening across the world.
In 2016, Americans watched 270 minutes of TV per day, viewers in the UK watched 212 minutes per day, while Indians watched 144 minutes per day, says statistical data released in December 2017 by Statista. In India, television has always been the biggest source of entertainment for every household. According to news reports, TV penetration in India increased by 10 per cent in 2017 at 64 per cent as compared to 54 per cent in 2013. The TV viewing universe stood at 780 million in 2017 compared to 675 million in 2013.
Consumer buying preferences keep changing with the ever evolving technology. If consumers were buying through brick-and-mortar stores, advent of computers and mobile phones taught them to buy online, not to forget the Home Shopping Channels that have been selling various products for over four decades. So what are these Home shopping channels? Home Shopping channels are television specialty channels targeted towards home shopping consumers by broadcasting product demonstrations or explanations. Many of the major shopping channels such as QVC and HSN broadcast live 24/7, while in India we have HomeShop18, Best Deal TV, DEN Snapdeal TV and Gemporia, amongst others. The format of the show is usually a host with a guest/product expert. According to KPMG India, the market size of home shopping market in India is around Rs. 5,400-6,200 crore.
Home shopping is a market with stable growth throughout Europe. Providers of live TV shopping, direct response TV (DRTV) and auction TV have responded well to the challenges of digitization and have developed into modern multi-channel providers, according to Goldmedia study ‘The Multi-Channel Home Shopping Industry in Europe - Market Overview, Key Trends and Forecasts to 2022’. The study was conducted on behalf of the European Retailing Association (ERA Europewww.era-europe.eu). The industry report covered the home shopping business in ten European countries (Austria, France, Germany, Italy, the Netherlands, Russia, Spain, Switzerland, Sweden and the UK).
“The biggest home shopping markets, such as the UK and Germany, still show notably positive growth rates of around two to four per cent per year, while evolving markets like Russia are expected to show impressive double-digit growth rates over the next few years. The average home shopping sales per inhabitant in 2016 stood at 9.2 Euros, with Germany being the leading country with about 23.4 Euros per capita, followed by the UK.” - The Multi-Channel Home Shopping Industry in Europe - Market Overview, Key Trends and Forecasts to 2022
With the advent of e-commerce, TV shopping network was supposed to take a backseat. However we need to pay attention to the fact that the adoption of web and web related services is still restricted to fewer people, especially younger ones while TV caters to older demographics. If we look at statistics in India, TV owning homes rose by 19 per cent and stood at 183 million in 2017. However, out of these 183 million households 99 million households are in rural India compared to 84 million households in urban India. Thereby rural India TV ownership stands 17 per cent higher than Urban India. The TV shopping network has seen a steady growth in the past few years. In this growth, jewellery shopping networks, too, have played a great role.
Well-known companies in jewellery shopping network:
• Shop LC, formerly known as Liquidation Channel, is an American cable network based in Austin, Texas which mainly specializes in selling jewellery. The network is a subsidiary of the India-based Vaibhav Global Limited (VGL). According to reports, the network’s reach is approximately 77 million households in the United States. The network sells inventory in a reverse auction format. The channel primarily sells jewellery, along with fashion accessories such as scarves and handbags.
• The Jewelry Channel (TJC) is a British falling-price auction-style home shopping channel and online retailer specializing in jewellery and gemstones. Also a part of the VGL group, TJC sells a wide variety of gemstone jewellery, loose gemstones, watches, fashion jewellery and simulated gemstone pieces.
• Jewelry Television (commonly initialized as JTV) is an American television network, formerly called “America’s Collectibles Network.” It has an estimated reach of more than 80 million U.S. households, through cable and satellite providers, online streaming and limited over-the-air broadcasters. Jewelry Television airs 24 hours a day, although programming hours vary between each region, based on the local TV provider.
• QVC is one of the notable names in the world of shopping channels in the U. S. The first item QVC ever broadcast and sold, in November 1986, was an $11.49 shower radio (Windsor Shower Companion). The year that QVC launched, it reached nearly 8 million homes, with the first full year of sales reaching more than $110 million, says reports.
• HSN, another notable name in the television shopping network was acquired by Liberty Interactive Corporation, the parent company of brands like QVC. The acquisition created the third-largest e-commerce company in the U.S., behind Amazon and Walmart. The QVC Group now comprises eight retail brands: QVC, HSN, zulily, Ballard Designs, Frontgate, Garnet Hill, Grandin Road and Improvements. “We are a third way to shop — beyond traditional brick-and-mortar or transactional ecommerce,” said Mike George, President and CEO, QVC, Inc., said in a press statement. “We’re a select group of like-minded businesses, offering highly engaging, content-rich shopping experiences for customers who want more than an impersonal transaction.” The newly expanded QVC Group is now reaching consumers via 17 television networks and multiple e-commerce sites, social pages, mobile apps, print catalogs, and in-store destinations.
Evolution in India
The television home shopping industry in India has come a long way since its inception in the ‘90s. They would sell limited products and they used to run commercials in the late night slots. TV commerce started buzzing when Home- Shop18 came into the business in 2008. Star followed with Star CJ Alive (now Shop CJ) in 2009. Though these channels sell jewellery, full-fledged jewellery selling channels in India are at a nascent stage.
Conceptualized in August 2014, Gemporia is India’s first live jewellery channel bringing you exclusive genuine gemstones and precious metal jewellery directly from factories to your home, manufactured in limited runs. “We are the largest jewellery e-tailer today, shipping more real jewellery than anyone else with maximum daily shipments,” said Manuj Goyal, Co-founder, Gemporia India.
Giving us an overview of jewellery shopping channels in India, Manuj Goyal, said, “There are no dedicated jewellery shopping channels in India, apart from Gemporia. Artificial jewellery is sold as a commodity on shopping channels currently. Unfortunately, these channels have a reputation of selling extremely low quality and unreliable product making TV shopping a genre that is looked down upon in the country.”
“In September 2015, Gemporia started with 4 hours of LIVE content on 2 major DTH players Videocon d2h and Dish TV, in India. Gemporia now caters to 4 major DTH players - TataSky, Airtel, Videocon d2h and Dish TV reaching out to almost 65 million homes, with 18 hours of LIVE shows and remaining hours of recorded educational content. Focused on jewellery, Gemporia is able to showcase a new design almost every 6-10 minutes with information and jewellery education,” he added.
Though e-commerce is enjoying a greater pie of the entire market size in countries like the U.S., TV Commerce is still growing there. And if industry experts are to be believed, the same can happen in India as it certainly has huge potential to grow. Now—a-days in India, consumers are more focused on convenience, which is a good sign for the TV commerce. Talking about India as a potential market for jewellery shopping network, Sunil Agarwal, MD & Chairman, VGL Group said, “There definitely is a market for jewellery on TV as Indian women love jewellery and with disposable in come increasing, a good chunk will go towards the purchase of jewellery. We also believe that the majority of women in India are home-makers than in the western countries so the market size and opportunity is there. However, there is a hurdle as Indian buyers still believe in ‘touch and feel’ when it comes to jewellery before buying but with increasing comfort of E-com, we believe this hurdle will diminish in the coming times.”
Home shopping operators are incorporating multi-channel selling approach to stay connected with the potential consumers. It’s not just TV anymore for them. In order to stay ahead of the curve, these operators are marketing their products in retail stores, catalogues and customer magazines, websites, social media platforms, mobile and smart TV apps and many more sales channels.
Explaining how multi-channel approach helps in achieving growth, Sunil Agrawal, said, “It is now a proven model with the success of QVC and our own ShopLC, USA and TJC, UK. The factors driving growth with the multi-channel model are many like seamless shopping experience for our customers and higher probability of product discovery. The life time values of multichannel consumers are much higher in TV and there is Conversion (making purchases) with the convenience offered by an integrated shopping experience.”
Talking about Gemporia’s approach, Manuj Goyal said, “Gemporia is a Television led e-commerce platform, which means we are available on TV and internet. The website and app offer LIVE TV feed along with a catalogue of over 5000 designs that are ready to be shipped, in stock. The jewellery can be purchased from the website or over a phone call via Prepay, Cash on Delivery and Free Shipping with no minimum billing requirements. There is a convenient option of 30 day money back for unused jewellery and in cases like Rashi Ratna even used jewellery can be returned. This multi-channel approach helps us reach out to our target audience - women, in all demographics.”
Future of Jewellery Shopping Networks
The industry analysts are saying that in the long run there could be a world in which television is provided via streaming over the internet, which would certainly bring in loads of opportunities to the home shopping networks. “The increasing use of mobile technology is an additional factor in making online retailing attractive and convenient. We envision mobile sales contributing more significantly to our online sales in the future and have recently launched mobile applications for our Shopping channels/Websites,” said Sunil Agrawal.
Talking about change in television consumer demographics in India, Manuj Goyal, said, “While e-commerce typically caters to an urban market, our audience base includes people from Tier II and III cities. The penetration of television in the country is far deeper and way more accessible than internet. Our audience finds it incredibly easy to shop with Cash on Delivery and feels spoilt for choice when it comes to design and availability.”
Jewellery was the best performing accessories segment with global sales over $316 billion in 2016, says reports. It was also the fastest growing segment. If one looks at these statistics, the jewellery selling on television or as it is referred as ‘TV commerce’ has a good future. In India, too, with rise in disposable income and Indian women’s love for jewellery is expected to boost the growth of jewellery selling on TV.