ShopNBC

Source: Retail Digital

Date :7/3/2007 5:31:18 PM

Behind the scenes of ShopNBC’s 24-hour home shopping broadcast is a highly orchestrated team that brings the best quality products right to your living room

Written and produced by David Weldon & Nick Ledue

Americans like to shop, and they certainly love a great value.

In fact, there are probably few things that Americans love better. Unless, perhaps, it is the ability to shop for a great deal without even having to leave home. After all, Americans also crave convenience.

Combine retail shopping, attractive prices, and home convenience, and you should have a guaranteed recipe for success. And, indeed, those three ingredients have led to much success for so-called home shopping networks, including ShopNBC.

Headquartered in Eden Prairie, Minn., ShopNBC operates a popular 24-hour live television sales network. The company specializes in fine jewelry and watches (which were its original product lines), but has expanded its offerings in recent years to include a variety of other lines, such as apparel, fashion accessories, computers, electronics, and home and outdoor furnishings.

ShopNBC saw its beginnings as ValueVision International in 1990. And in 2001, this network rebranded its television and Internet business as ShopNBC as part of its partnership with NBC.

The primary competitors of ShopNBC are the QVC Network, and the Home Shopping Network (HSN).

Standing out

ShopNBC has a simple and straight-forward formula: airing a variety of high quality merchandise, sorted concepts and categories, for limited time periods, at great values, for television audiences to see first hand, and make a purchase.

In the home shopping space, the format for airing sale items is very similar from one network to another. That puts the pressure on each network to differentiate itself in the areas of quality and price, or in certain core product areas.

For that reason, as much as it has expanded into other areas, ShopNBC has remained faithful to its jewelry and watch customers, and those items are still a large percentage of available offerings, according to Holly Shaskey-Platek, vice president of planning, programming and promotions at ShopNBC.

And if you’re in the market for some really fine jewelry, Shaskey-Platek says ShopNBC has lots of items to show you — thousands, in fact. And with that many to sell, but only a few minutes to promote them, she says the company relies on developing viewer interest ahead of time, and then moving inventory very fast once on-air sales begin.

ShopNBC has developed a tried-and-true process for promoting sales events ahead of time, getting individual products in front of viewers, processing large volume sales, and managing the distribution of hundreds of sale items per hour, every hour. Making it all happen are large investments in technology, and a commitment to very efficient operations.

ShopNBC makes every effort to manage the back-end and front-end aspects of the business, to create the ultimate customer experience, Shaskey-Platek explains.

This means managing the information technology systems and telecommunications networks that connect customers to the company, capture order information, and turn those orders into shipping and billing invoices for fulfillment.

For Shaskey-Platek, her role in partnership with merchandising is to execute the merchandising and promotions strategies to meet the company’s overall financial plan.

Home shopping networks obviously have an advantage over physical retailers in not having to build and operate commercial space, or having to fill that space with large quantities of inventory that moves slowly. Products are featured in specific time slots by category, according to hourly productivity goals, Shaskey-Platek says.

ShopNBC operates a very complex vendor matrix to maximize its success in getting products to its customers. This includes managing what items the network will air, how many different items it will need for each time slot, how much inventory is needed for each item, when the merchandise is to be delivered to ShopNBC warehouses or on hand at the vendor, how and when the items will be promoted in advance of the show, and how sales will be handled for most efficient delivery to customers.

For every item that ShopNBC will feature in its various time slots, it keeps a minimum of two samples of each item on hand at the studio in Eden Prairie, for use as an on-air visual and for marketing purposes.

Actual inventory to be sold is handled in one of two ways, according to Shaskey-Platek. It may be directly shipped from a third party vendor to ShopNBC customers as they make their purchases. Or, the inventory may be shipped to a separate ShopNBC distribution center in Bowling Green, Kentucky.

The process of putting items on air actually begins months earlier, Shaskey-Platek says. ShopNBC plans far in advance what types of products it will sell, based on marketplace trends and historical sales and productivity data.

“We have different productivity goals for different time slots,” Shaskey-Platek says. Some are regularly featured product categories, which air in the same time slots each week. Others rotate or are featured as specials.

As soon as ShopNBC decides on a future date’s category lineup, it then finalizes the type of merchandise to feature in each time slot for that day. The company then solicits specific merchandise proposals from its many vendor partners. In collaboration, ShopNBC merchants and vendors will build the assortment by assessing what types of products ShopNBC needs based on show theme and productivity goals.

Once the deals are done, two processes then get underway — for the vendor to assemble the quantity of merchandise needed, and to have them either delivered to the ShopNBC distribution center on the agreed upon date, or to have them on stand-by, for shipping directly to customers the day of the on-air sales.

Each vendor is also called upon to help ShopNBC with product features and benefits which help us sell the products. Hosts are scheduled for each program, and the call center staffing is scheduled according to anticipated sales and call volume.

With back-to-back-to-back sales programming running all day, there is little margin for error in the process. That means ShopNBC must have a back-up show available for every hour of programming on the lineup — or, the ability to air a different upcoming program at a moment’s notice, with host, inventory, and marketing ready to adjust instantly.

No reset for the weary

Filling 24 hours of air time with merchandise requires a lot of jewelry and home furnishings. According to Shaskey-Platek, ShopNBC typically breaks its air time down by one-hour sales segments. Each segment typically features approximately 8-12 different items.

Each segment, in turn, has its own host, and involves 55 minutes of live air time, plus another five minutes of promotional time for other same-day or future network segments.

Leading up to that point are countless hours of preparation by buyers, the marketing team, logistical support, graphic designers, IT support, production crew and a host of others.

Should ShopNBC be warehousing the merchandise itself prior to televised sales, the rule of thumb is to have the full quantity delivered to the ShopNBC distribution center 28 days prior to the sales event.

All of this coming and going of products, and dozens of preparation steps for all, requires a cutting-edge IT backbone. It also needs a staff of approximately 1,200 employees. This includes employees at the Eden Prairie headquarters and studios, the customer service call center in Brooklyn Center, MN, and the Kentucky distribution center.

Presently, ShopNBC also has a website that works as an extension of the product listing that viewers see on television. Visitors to the site can order items seen on television directly from the website, plus additional products only available on the web.

As busy as the company is just managing this process, it recently launched a major internet video initiative, which makes the television network available in real time, high quality resolution on the Internet. With the launch of ShopNBC.TV, ValueVision leads the home shopping and internet retail industries in the video commerce ("vCommerce") arena.

Well trained, and top skilled

A 24-hour television network and Internet retailer puts a lot of demand on crew and staff. As a result, the company places high priority on retention efforts.

“We really do believe that our people are our most important asset,” Shaskey-Platek says. “Our people work a lot of weekends, and a lot of odd hours, so we try to offer a lot of flexibility to everyone.”

Not surprisingly, web development and web content management skills are in high demand by the company. So, too, are television production and programming skills.

When asked what skills she most looks for in the job market, Shaskey-Platek says “creativity, intuitiveness, interpersonal skills, leadership qualities and a candidate who is customer-focused.”

Ultimately, Shaskey-Platek says the ShopNBC team is “dedicated to offering its customers distinctive, quality products at a great value through a personalized, convenient and informative shopping experience.”