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How the QVC/HSN merger illuminates the future of omnichannel shopping

That future depends on what kind of shopping experience customers want.

Barry Levine on July 11, 2017 at 3:34 pm

Last week’s merger of QVC with Home Shopping Network (HSN) is being cast by some observers as a “move to challenge Amazon.” The question is what kind of challenge it is, if any.

As a combined retail entity, QVC/HSN is third behind Amazon and Walmart in sales. Both Amazon and Walmart have been making big acquisitions in recent months that signal their desire to become omnichannel giants.

For University of Florida retail/marketing teacher Steven Kirn, the former head of the Miller Center for retailing education at that school, the new QVC/HSN isn’t much of an omnichannel presence.

“The consolidation is not surprising,” he told me, referring to QVC’s acquisition of the 62 percent of HSN that it didn’t previously own. It reflected the fact that TV-based shopping “has been declining,” he said, “and is a move to create an efficiency.” He doesn’t see QVC and HSN’s online selves or their small number of physical outlets as major factors in their future.

But Anita Bhappu, a retailing expert now teaching at the University of California at Merced, thinks the merger illuminates what is happening with these giants.

“They’re all omnichannel,” she said, pointing out that their omni-retailing vision is based on their different monochannel origins.

Amazon, of course, grew from its huge online store, while Walmart’s future is built around its big box physical locations. For its part, QVC/HSN is based on shopping as a TV show.

But those are only the logistical descriptions. Bhappu pointed out that the three retailers may well be headed in totally different directions, because of their different orientations.

Amazon online, she said, is the epitome of efficient shopping, so it’s particularly interesting that they recently bought Whole Foods, a high-end food retailer. Whole Foods’ stores may become distribution centers for Amazon, but they could have bought anyone for that.

This past weekend, I went to Whole Foods looking for high-quality veggie hot dogs. I don’t usually do our family’s food shopping, but that brief swing into this huge store resulted in my buying several other items whose quality or uniqueness stood out. In other words, I might concede it was a pleasurable experience.

Walmart, on the other hand, emphasizes how you can save money by leveraging their widespread physical locations, such as a free grocery pickup service after online ordering. It’s still not completely clear how their Jet.com acquisition fits into the Walmart vision, but the retail chain also has its own robust e-commerce store.

QVC/HSN is built around shopping as entertainment, and Bhappu noted that it has experimented with some related online features, such as offering accompanying recipes or videos.

Once they consolidate their TV position, she suggested, they may well choose to expand on that strategy. It’s also possible that they could eventually become on online video experience simply because digital TV could be on its way to a full merger with online tech, such as in ATSC 3.0.

In any case, these three approaches to the next stage in retailing could compete, or they could travel down different but successful roads. It largely depends, Bhappu said, on how many consumers center their shopping choices around efficiency, local pickups, adventurous trips to the store or entertainment.

About The Author

Barry Levine

Barry Levine covers marketing technology for Third Door Media. Previously, he covered this space as a Senior Writer for VentureBeat, and he has written about these and other tech subjects for such publications as CMSWire and NewsFactor. He founded and led the web site/unit at PBS station Thirteen/WNET; worked as an online Senior Producer/writer for Viacom; created a successful interactive game, PLAY IT BY EAR: The First CD Game; founded and led an independent film showcase, CENTER SCREEN, based at Harvard and M.I.T.; and served over five years as a consultant to the M.I.T. Media Lab. You can find him at LinkedIn, and on Twitter at xBarryLevine.