At-home shoppers who just can’t resist the TV appeal to purchase products ranging from electronics to jewelry will be wowed by this deal: QVC is joining up with the Home Shopping Network.
Denise Dahlhoff, Research Director at the J.H. Baker Retailing Center of the Wharton School at the University of Pennsylvania, discussed the merger with WHYY’s Dave Heller.
The companies long known as bases for home shopping on TV had been dealing with sluggish sales as Amazon dominates online. Both had long moved beyond cable channels and were trying to refashion themselves for younger shoppers buying more on their mobile phones.
QVC parent company Liberty Interactive is taking control of the HSN for about $2.6 billion in stock to create what they say will be the third-largest e-commerce company in the United States.
Liberty Interactive Corp., which owns QVC already owned 38 percent of HSN. Integrating them will make them “stronger than they are individually and stronger yet as a stand-alone entity” in a “changing and difficult market,” said Greg Maffei, Liberty’s president and CEO.
Under former CEO Mindy Grossman, HSN had worked to build its e-commerce presence and transform itself into a lifestyle network. It derives half of its revenue from e-commerce, featuring more than 50,000 products on its website along with broadcasting to more than 90 million households.
Executives on Thursday highlighted the potential for cost savings, complementary but not wholly overlapping customers, their strength in video and the larger reach the two will have. The companies also said they hope to use Zulily, which QVC bought in 2015, to drive younger customers to both brands.
The deal is expected to close in the fourth quarter.