Qurate Retail Inc., QVC. Inc.’s parent company, reported e-commerce revenue of $1.8 billion for the first quarter ended March 31, which represents 56.3% of Qurate’s total $3.2 billion in revenue for the quarter.
The following retail brands will operate under Qurate: TV and web retailer QVC Inc., flash-sale site Zulily.com, as well as HSN and Cornerstone brands including Ballard Designs, Frontgate, Garnet Hill, Grandin Road and Improvements. The parent company acquired HSN and its brands in mid-2017 for $2.1 billion.
HSN’s results are only included in Qurate Retail’s results beginning Jan. 1, so year-over-year comparable numbers of the Qurate brand would not show an accurate picture. Here’s how e-commerce sales broke down for each retailer:
QVC:
- QVC’s Q1 e-commerce sales increased to $1.04 billion, up 11.1% from $936 million in Q1 2017.
- E-commerce sales represented 49.5% of total sales for QVC, up from 47.6%.
- QVC’s U.S. e-commerce sales were $792 million and represented 55.9% of total sales, up 8.1% from $733 million and representing 53.5% of U.S. sales.
- QVC’s international e-commerce sales increased 20.7% to $245 million, up from $203 million.
- International e-commerce sales represented 36.2% of international sales, up from 34.1%.
HSN:
- E-commerce sales decreased 8.0% year over year in Q1 to $241 million, down from $262 million.
- E-commerce represented 47.3% of sales, up from 46.6%.
Cornerstone brands:
- E-commerce sales decreased 8.7% to $147 million in Q1 2018, down from $161 million in Q1 2017.
- E-commerce represented 71.1% of sales compared with 71.4%.
Zulily:
- Zulily generated $419 million in sales in Q1 2018, a 16.7% increase from $359 million in Q1 2017.
Despite overall and e-commerce sales decreases for HSN and the Cornerstone brands, CEO Michael George told investors that the “turnaround process” will take a few quarters, not months and not years, according to a SeekingAlpha transcript.
“While the HSN and Cornerstone results remain challenged, we are confident in our ability to affect a turnaround at both,” George said.
Because QVC and HSN are both TV and web retailers, Qurate is still determining how to keep each brand differentiated, but still share some of the successful QVC tactics with HSN.
For example, QVC sells several national kitchen and cooking brands including KitchenAid, Keurig and Vitamix. Qurate believes that both QVC and HSN can sell these “top-tier” brands.
“We want to keep [QVC and HSN] fairly distinct, but I mentioned some examples where it’s a broadly distributed national brand where we think we can get more total sales by putting the brand on both networks,” George said. “You’ll also see us introducing more QVC suppliers, but those suppliers would be bringing different kinds of brands to HSN.”
Qurate also wants to adjust HSN’s product mix to have a better balance across categories. For example, right now HSN has a small fashion mix but a large electronics mix, and those categories should be more evenly distributed.
QVC Group is No. 7 in the newly released Internet Retailer 2018 Top 1000, and HSN is No. 28.
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