"QVC is earning a place in the pantheon of the world's most successful innovative retailers. Last year QVC rang up $5.7 billion in sales and $760 million in operating profit, making the liberty media subsidiary nearly as big and twice as profitable as Amazon.com. Its 13% operating margin beats those of brick-and-mortar heavyweights such as Federate Department Stores, Target, and Wal-Mart." Also "QVC now reaches 90 million of America's 92 million households with pay TV". No internet company has developed a business model that achieves nearly as much market penetration! "Live broadcasts also allow the company to respond quickly to sales trends to stoke demand." Here, "producers tracks calls, orders, and inventories, tweaking programs in real time to boost sales." The internet models used by industry leaders like Amazon.com and Ebay, on the other hand feature dormant, non-live, untweakable feeds and un-performing products. QVC also employs the product placement strategy. Its products are marketed by stars - who claim to use the products and sometimes use them on sets. This strategy will help marketers reach their target markets by "placing" products on the sets of their favorite TV shows.
QVC's business model exemplifies one of TV's successful business models. This model, along with other TV-based models that produce amazing results, can help global marketers penetrate markets in multiple countries.
Source: Elizabeth Esfahani. "A Sales Channel They Can't Resist". BUSINESS 2.0. September 2005.
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