Informercial site iQVC leverages its TV brand

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Online infomercial site iQVC is one of the first Web department stores to declare itself profitable, crediting its success to its ability to leverage its existing cable TV brand online.

The site reported $5 million in sales in December, up from more than $3 million in November.

In December, it was the sixth-most-trafficked Internet shopping site, drawing 2.9% of all users at least once, according to Media Metrix.


"We are able to take advantage of 11 years of technical expertise relating to electronic commerce," said Stuart Spiegel, VP-general manager of iQVC, referring to cable TV channel QVC's background in processing transactions, deliveries and inventory.

"[The online business] is expensive. It costs money and time, and it takes months, but we already knew things other companies have yet to figure out," said Mr. Spiegel, including the calculation of different sales-tax levels by county. "All those details are in our system already."


Mr. Spiegel was hired to launch the Web store for the infomercial company in 1995. He was previously VP-retail distribution at Sony Signatures.

iQVC is a division of cable channel QVC with a separate Web site and staff of buyers. The iQVC budget also paid for the site's recent redesign, by Studio Archetype, San Francisco.

While the QVC shopping channel drives traffic to the Web site, iQVC delivers sales the cable channel can't, said Mr. Spiegel. If QVC is selling a KitchenAid mixer, iQVC has a full line of blades, bowls and attachments.

Mr. Spiegel is confident sales on iQVC are incremental, not stolen from the cable network. He also notes users buy more items per visit on the Web than by phone.

iQVC's sales figures represent "real money," said Vernon Keenan, senior analyst at market researcher Zona Research. The Web site lets QVC do "up-sells," collect data on buyers, and use those data for future growth, he added.

Nicole Vanderbilt, director of digital commerce for Jupiter Communications, puts iQVC's figures on par with those of Ticketmaster Corp., a Web ticketing service that has also been successful. However, she questioned how far any general merchant can go online.

"There are so many category killers with expertise and service. The one-stop shopping advantage of Wal-Mart [Stores] doesn't exist on the Web."


So QVC has been expanding into vertical markets. Gems and Jewels debuted last month. Mr. Spiegel described it as a fashion zine with iQVC's merchandising strengths.

The site is also boosting its marketing and promotion budget, buying banner ads, participating in the Yahoo! shopping guide and striking a deal with America Online to be an anchor store on several shopping categories that began last September.

Copyright March 1998, Crain Communications Inc.

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