NEW YORK – Home shopping network HSN is offering another way for shoppers to buy their goods: using their remote control pad to buy such merchandise as clothing and jewelry on TV. It is the first service of its kind being offered in the U.S.
The new shop-by-remote interactive TV service quietly began testing in Hawaii at the beginning of the year, while service in parts of the New York market started being tested a few months ago. HSN, a division of IAC/InterActive Corp. controlled by chief executive Barry Diller, plans to roll out the service nationwide over the next several quarters.
"We are introducing one market at a time," said Scott Sanborn, vice president of marketing at HSN, which announced the plans Monday. "We are very encouraged by what we see." Company officials estimated that HSN has so far generated several hundred thousands of dollars through the shop-by-remote service without any marketing to support it.
Time Warner Cable, a subsidiary of Time Warner Inc. (TWX), is HSN's distribution partner in Hawaii, while Cablevision Systems Corp. (CVC), a New York market cable TV systems operator, is the distribution partner in the New York area.
HSN's home shopping rival QVC, a division of Liberty Media Corp., launched a shop-by-remote TV service in September 2001 in Britain, which is doing "very well" according to Mark Suckle, CEO of QVC UK. QVC officials declined to comment on its plans for the U.S.
The HSN shop-by-remote launch comes as home shopping networks are aiming to be everywhere the customer is. QVC offers a service in Japan where consumers can shop on their cell phones and plans to offer shopping videos on Internet portals sites. HSN will be test selling its goods on mobile phones next year.
"It's all about the consumer having more opportunities to shop and more control to shop," said Chad Doiron, who manages the North American information technology strategy practice at Kurt Salmon Associates. "The tactic they are taking is to tap into that. The question is, will one form prevail or will consumers engage in a variety of technology?"
As for shop-by-remote TV service, it's taking some time to introduce the service in the U.S., given how complex the market is. In Britain, there's one dominant distributor — Pay-TV operator British Sky Broadcasting Group PLC, which can deliver the application to a big chunk of the country with one standard technological platform. Here in the U.S., there are six major cable providers and two satellite providers, all with varying technologies in use. Therefore, it has taken longer to come up with an application that is custom-engineered to work with the various technological platforms.
HSN's service, whose technology is being powered by Tandberg Television, allows digital cable customers to immediately purchase any item presented on HSN during its regular broadcast with a few clicks of their remote control. Shoppers press the select button and use the arrow keys to navigate. Customers' name and address pops up; shoppers' credit card information is already stored with HSN. Customers can order the product that's being aired as well as the two products that aired before it and the daily special, launched every night at midnight.
Meanwhile, QVC has been improving its shop-by-remote TV service in the Britain by experimenting with streaming video that appears on the TV screen. The "buy now" button on the TV screen allows viewers to quickly choose an on-air item, the daily special value or order any other item. The viewer enters the quantity and size and color, where appropriate, and inserts their account number and PIN and confirms the order.
Last month, QVC took in a little less than 100,000 orders using the BSkyB remote control button in Britain. During 2005, QVC UK took in 1.2 million orders using the BSkyB remote control button. For the past 12 months, QVC had 1 million shoppers that have purchased products by all methods, phone, buy button and Web in Britain, according to Suckle.