Spanish Shopping Network is slated to be launched on Galavision, the U.S. cable sister network of Univision, in the first quarter of 1998. It likely will start as a 3-hour, live daily block of Spanish-language selling, produced in HSN's St. Petersburg, Fla., studio, said Michael McMullen, president of HSN's International Home Shopping Network unit.
HSN will own 50.1% of the venture and Univision, 49.9%.
GERMAN, JAPANESE VENTURES
The new attention to the Latin market comes after successful joint ventures that brought the HSN concept to Germany and Japan, Mr. McMullen said.
"Our experience is this business transcends all boundaries. Women like to shop, and they like to shop on television," he said. "We've proved that in Japan and Germany, and we have every expectation that it will be as or more acceptable in the general Hispanic market and in Latin America."
Key to the relationship with Univision, which owns 21 TV stations in the U.S., is the network's partial ownership by Mexican TV giant Televisa and Venezuelan media conglomerate Venevision.
Those media companies could provide HSN with springboards to Latin America, though expansion would likely have to be country by country -- due to national regulations and local distribution issues, Mr. McMullen said.
"We are focusing on getting this business running and then [will] start to roll it out country by country in Latin America," he said. "It's a great combination for expanding into Latin America."
$348 BIL IN SPENDING POWER
The 29 million-person U.S. Hispanic market alone generates $348 billion in annual spending power, according to ethnic consultancy Market Segment Research & Consulting.
But despite that attractive target, HSN's ambitions are not without hurdles.
Mr. McMullen said he's undaunted by research that shows lower credit-card penetration amongU.S. Hispanics than non-Hispanics, and studies showing Hispanics are slower to take to non-retail-oriented sales outlets.
He admitted the Hispanic demographic for the Spanish Shopping Network likely will skew lower than the typical HSN shopper -- a 40-to-55-year-old woman with a household income approaching $50,000.
The fact that the 2.5 million Hispanic households that Galavision reaches are paying for cable TV buoys Mr. McMullen's hopes for success.
"The Hispanic market has a lower per-capita income [than the general market], but we're more interested in how they spend it," he said.
The move has "significant potential" but only if the network overcomes the issues of Hispanics' retailing preferences, product offerings and payment methods, said Gary Berman, president of MSR&C.
It will be important for the Spanish Shopping Network to test products and on-air personalities, while also familiarizing Hispanics with the concept of TV