TV shopping’s lessons for today’s online video shopping

I interviewed Bill Lane, a retail consultant and one of the pioneers in video shopping. In the interview, Bill shares his thoughts on the beginnings of video in retail (over 30 years ago) – when it was confined to the storefront and then to television.  He helps us understand how we can apply the lessons learned from that era to the new landscape of Internet/mobile technologies and shopping communities of today.

Bill saw the potential of video shopping back in 1992 when he was VP of Merchandising for a broadcast TV show featuring Joan Rivers (“Can We Shop”). Long before reality TV became an entertainment standard. Bill’s 20+ years’ of executive-level experience have helped shape retailing giants including QVC, HSN, Shop at Home TV, Jewelry TV, Styleclick, Internet Shopping Network, 1-800 Flowers, Bloomingdale’s, and Tribune Entertainment.

Part 1 of my Interview with Bill Lane

VCC: What has been the most exciting part about being involved in video shopping, from the early days of television shopping to where it is today?

Bill: Along with all the changes, it’s about people and how people communicate.  That comes from my original background when I served as a city planner.  I’m more interested in how people talk to each other and how they communicate and what they’re needs are.  Retail forces you to constantly evaluate this. As the way people talk to each other changes, merchandisers also need to change how they communicate with shoppers.

Retail video always has been about story telling, and using the technology to find the most interesting stories to tell.

Genesis of video shopping: brick-and-mortar store retail

My first experience with video was actually at the retail level of brick-and-mortar stores in the ‘80s, utilizing TV’s on selling floors. In the beginning, video was for instructional purposes.  In the housewares area for example, video was used to show a shopper how to cook or how to utilize a piece of equipment.

Then bigger department stores began to realize the impact of video.  They began setting up their own giant TV banks. For example, when Bloomingdales opened up a new store in Chicago, they would have 50 TVs along the storefront.  Video was used to bring people into the experience and grab their attention.  That was very much what how video was being used (in the beginning of retail shopping).

The 2nd wave: The beginnings of TV shopping – (celebrity) infomercials

After 10 years of retail in brick-and-mortar, I went into TV shopping. First I developed an infomercial TV show with Lucy Arnez.  Later, I developed a TV shopping show with comedian Joan Rivers called, Can We Shop? Can We Shop was a television talk show that ran 1993-1994, hosted by Joan Rivers in which guests pitched products that viewers could purchase via an on-air telephone number.

So all of a sudden, the whole static world of shopping – where products sat on a shelf or in a window – suddenly became alive to the consumer. Merchandisers could not only tell their stories with features and benefits as an infomercial does; now they could leverage video to provide a rich storytelling experience.  Video enabled retailers to pull the customer “into” the product while fascinating them with the story.

How much growth has television shopping experienced since the beginning?

Many people don’t realize that the TV shopping world generates more revenue than domestic movie sales. It has been around for over 30 years and they’ve created a formula that works.  It’s a giant industry, but what they’ve done is create a format both in terms of broadcasting as well as programming that knows how to talk to their audience.

The TV shopping audience, while relatively small compared to the entire country, is economically powerful. [The producers] have gotten that down pat and they know how to talk to that customer.

So why has TV shopping continued to be so successful for decades now?

First, the TV shopping experience was easy to build around because it had a huge, built-in audience. Now, the infomercial was selling to one particular audience, selling primarily on features and benefits. Whereas the average “good” customer for a TV shopping network will buy over 50 times a year, and has an audience that’s more about just features and benefits.  They have been able to put products in context.  That means they’re able to surround the product with value, so when the customer is looking at an item they’re not only thinking about what it does; they’re also thinking about “what it can do for me.” So [the producers] continually show the product in different ways, and how it can be used for different lifestyles in different ways.  They do this through a series of additional videos and background, such as: telling the history of something, try coming up with what makes the product unique, what makes this experience unique because you’re creating an experience through TV shopping while you’re putting this product in context.

What the TV shopping networks have done through video is create an atmosphere of trust.  They reinforce this trust through their pricing strategies; they reinforce it through their broadcast standards; they reinforce it through their programming.  Subsequently, they’ve built this very successful, very productive model. Remember that a TV station – once it has reached maximum distribution, 90% to 95% of the country – all they have left is the same 24 hours a day, 365 days a year.  So they have to come up with mechanisms and ways to make every minute more valuable.

What products are best suited for TV shopping?

It’s easy to sell a television set or a movie camera because everybody knows what that is.  It’s not always so easy to sell rugs from the Middle East. For the latter, you need to be able to target what makes this rug special, what makes it unique.  Why do I care that I need a rug from the Middle East and not one that’s made in China?  What’s the difference between a hand made rug and a commercially made rug?  So you put it in context for your audience, and you’re doing that through visual mechanisms; and most importantly, you’re doing it with people. People are relating to the people who are talking about the product.

In PART 2 of my interview, Bill talks with me about where video shopping is today on the Internet and mobile devices, and the challenges that e-retailers will need to overcome to make shopping online comparable to where TV shopping is today.