Five years ago, naysayers lamented that HSN (Home Shopping Network) would not be able to compete in the digital age, with its history of C-list celebrities pushing rhinestone jewelry and miracle skin creams.  When Mindy Grossman took over as CEO, she set out to change that perception, and she has done so very quickly.  After posting a multibillion dollar loss in 2008, HSN (which also owns lifestyle brand Cornerstone) posted a profit last year of $130 million and its stock price has risen from $11 in 2008 to $54 today.

HSN’s primary target market is women age 25 to 54 with an average annual income of $69,000.  In order to reach these people, Ms. Grossman repositioned HSN to be a place where busy women could shop on their phones or tablets while at their kids’ soccer practice.  More than half of new customers for HSN access the site through their mobile phones.  In order to stay connected, Ms. Grossman has six TV screens above her desk broadcasting HSN, QVC, HSN’s home page, as well as shows like Rachel Ray and cable news in order to monitor what women are talking about.

Grossman came to HSN from Nike.  Since she has been at HSN, she has instituted some significant changes.  She had all the buildings of the 66-acre HSN campus pressure washed and painted a gleaming white.  She recruited new talent like Emeril Lagasse and India Hicks to host HSN shows.  She also assembled a leadership team, where over half of the executive branch and board of directors are female.  Finally, Grossman spent hundreds of millions of dollars on new infrastructure, technology, and websites.  Now shoppers can cook dinner while watching Chef Emeril on HSN’s TV channel while also chatting online with an HSN host or playing an HSN arcade game to vie for HSN merchandise prizes.

Analysts are still skeptical of HSN’s ability to compete with Target and Walmart, as well as rival QVC, which is over twice the size of HSN, but Grossman believes that they can do it.  According to Grossman, HSN is “not trying to be Amazon, all things to all people.  We (HSN) have a highly specialized customer and want to give her the best experience somewhere she can trust.”

Discussion Question:

What has HSN done to assure its future in a mobile/digital era?

 

SOURCE: Shelly Banjo, Wall Street Journal, July 4, 2013