Mktg - India;Home Shopping,a habit-changing concept

D. Murali


‘Home shopping’ via a television channel is not an entirely new medium for the Indian audience. For long, viewers in India have watched Asian Sky Shop aired on different channels. However, what is new, and catching early eyeballs, is the concept of a 24-hour channel wholly dedicated to home shopping.

First on the block is HomeShop18, a Network 18 venture, launched in April this year. Growing at 30 per cent month on month, the company is targeting to achieve ‘a run-rate breakeven’ in the first year of its launch. With more channels looking to grab a share in this market, one can expect to see more action in this space over the next 12 months — a clear indication of the growing retail space in India.

“Home shopping is a habit-changing concept for the Indian consumer,” says Sundeep Malhotra, CEO, HomeShop18 in an interview with Brand Line. “Retail trends are changing drastically. However, for e-commerce to evolve in the consumer retail space, consumers at large have to be aware of the benefits of the medium.”

Excerpts from the interview:

Your views on the retail trends …

Retail trends are definitely changing drastically. The Indian consumer is an early adopter and this has been displayed across industries such as telecom, automobiles or technology. The same has been ratified in the e-commerce space also. Consumers in India are already showing they want a more convenient way to shop.

Has e-commerce caught up in India? What are the challenges here?

E-Commerce is increasingly becoming a more acceptable way of shopping for the Indian consumer who is beginning to see its value — online ticketing and success in the e-broking space are cases in point.

E-commerce Web sites give the consumer access to a wider range of products and provide them with competitive prices and greater value.

Having said that, the biggest challenge is the lack of confidence consumers have in this domain. This hesitancy comes from the fear of ‘paying online’ as security remains an issue.

Besides this, a large section of the audience is not comfortable with the process of placing an order on the shopping Web sites. For e-commerce to evolve in the consumer retail space, consumers at large have to be aware of the benefits of the medium.

Indian buyers like the ‘touch and feel’ concept before finalising on their buying decision. HomeShop 18 is a move away from that concept…

While ‘touch and feel’ is a reality amongst the Indian consumers, we have taken various initiatives to counter it. We believe that detailed product explanations and lengthy demonstrations on our TV channel allow the end consumer to make an informed decision.

The introduction of video technology on our e-commerce portal (first time on any e-commerce site) allows consumers to see actual demonstration of over 200 products and this helps in the decision-making.

We also have the facility of 15 days money-back guarantee with ‘no questions asked’ return policy. We also have ‘cash on delivery’ with no upfront payment for most of the products.

Promoting this relatively new concept in India will be a challenge?

Home shopping is a habit-changing concept for the Indian consumer; and, therefore, for us what is more important at this stage is to ensure that our consumer has a delightful experience. Once that is assured, the concept will gain acceptance and popularity through word of mouth.

Given that there is a ‘frequent switching of channels’, how confident are you about catching those eyeballs and converting them to business? Any research findings that endorse this trend…

We are not targeting any “appointment viewing”. This domain is all about “snacking” and we provide that 24x7.

We have witnessed a very encouraging response since the launch of the channel. People are actually watching and buying on the channel and transaction volumes are constantly growing. The TAM reports have shown substantial growth. A research study on buyers and viewers show that 62 per cent of our buyers watch the channel four times a week and over 50 per cent of the viewers are repeat customers

Do you expect any specific products lines to catch up more than others in this ‘Home Shop’ model?

Globally, the tele-shopping channels are known to sell all genres of products and services. They are regarded as popular launch pads for brands across industries. We intend to establish the business in a similar way and are confident that we will successfully sell all kinds of products and services catering to different genres.

Your partnership with companies and brands …

Ours is an alternative distribution model and we work as a partner with brands just like any other channel of distribution, except that our reach is far wider since it is via a television channel. We have already built alliances with over 200 brands across 19 product categories that include jewellery, toys, laptops, cameras and kitchen appliances.

What kind of volumes have you seen so far and what are your revenue targets? Do you have any plans to target smaller cities and towns?

Physical retail is restricted to about 300-400 cities and towns across India. Our television channel has already reached about 800 cities in India. We have been growing at 30 per cent month-on-month and our call volume is increasing by about 15 per cent every month.

Surprisingly, we are seeing business growth from 1-10 lakh population strata and even sub-1 lakh towns. We expect metros to contribute about 30 per cent of the total business, with the rest coming from mini-metros and one lakh plus population strata towns.

Our plan is to achieve a run-rate break even in the first year of operations. Over the next 12 months, we also expect to be counted among the key players in the overall organised retail space in India.