Qurate Replaces HSN’s President, Snippets From The 4Q Earnings Call

Dang, we buried the lede on Qurate Retail’s fourth-quarter results: HSN has a new president, Stacy Bowe, replacing Rob Muller.

The CEO of Qurate, the parent of both HSN and QV, announced the news last week that Bowe, who has been serving as the chief merchant at QVC U.S. since joining the company in 2022, is hopping over to lead HSN.

David Rawlinson described Bowe as “one of the driving forces behind the improvement at QVC, including rapidly recalibrating our buying program, improving our inventory levels and bringing freshness and newness to the assortment.”

He said that prior to QVC, Bowe was at G-III Apparel Group and Macy’s.

“I would like to thank Rob Muller who has distinguished 23 years of extraordinary contributions to the company including serving for the last two years as president of HSN,” Rawlinson said.

Thanks for nothin’, we’re sure Muller was thinking.

“In summary, our business reached an inflection point in the third quarter of 2023,” Rawlinson said. “We have made substantial progress in stabilizing revenue and growing cash flow and profitability. We look forward to continuing to drive improved results in 2024 while preparing the business for its future of multi-platform growth.”

Welcome to the hot seat, Stacy!

For the die-hard fans, or masochists, among you, here are snippers from the earnings call. Want to know how much Barefoot Dreams sold on Cyber Monday? It’s here.

And BTW, here is the entire transcript for the call.

https://uk.finance.yahoo.com/news/qurate-retail-inc-nasdaq-qrtea-154203339.html

Snippets:

In March, self-taught cake artist and social media influencer, Yolanda Gampp who has 4.5 million YouTube subscribers and 2.8 million Instagram followers will introduce a new bakeware line. Many other celebrities will join us this year and we look forward to sharing more on future calls. And finally, we continue to provide value to customers through compelling product values, exposure to their favorite host and celebrities, and importantly our engaging programming. Our programming is enhanced by destination and mass events, especially around the holiday season. We hosted a 49-hour nonstop holiday party across channels and platforms with fun holiday shopping and special pop-in personalities. 680,000 customers shop the weekend, including more than 40,000 new customers.

The event generated 81 million views across social platforms. It features several live streams, including holiday guides to get together with Jimmy Garth, holiday head-to-toe style with experts, high chocolate cocktails and holiday recipes in 30 minutes with Fabio Pavani. We have also appeared on other powerful platforms to fuel engagement. QVC host presented gift ideas on popular talk shows including The Drew Barrymore Show and the Tamron Hall Show to promote our Holiday Giftathon. We remain excited about the value proposition that makes QVC and HSN unique and we’ll continue leveraging this model as we expand across platforms.

We are pleased that QxH grew market share as top line performance largely outpaced discretionary retail for the second consecutive quarter. Throughout the year, we have maintained focus on obtaining new higher-quality inventory that would excite our customers and provide them with value. We reinvigorated our programming and honed the special relationship our customers have with Host, which led to continued high engagement, growing total linear minutes viewed 15% compared to the prior year.

Consistent with historical averages, QxH existing customers made up half of total customer count that generated 90% of 2023 sales. They purchased 31 items in 2023 and spent $1,600 on average. The strength of engagement is even more evident, and our best customers in QVC US, who are defined as purchasing at least 20 times a year. They were 17% of the count which generated 76% of the sales in 2023. They purchased, on average, 76 items in the year and increased their average spend 9% year-on-year to $3,900.

Rather than growing the file with expensive-to-obtain and hard-to-retain transient customers for now we are concentrating on stabilizing our customer file, retaining our best customers and returning to new customer growth year-over-year that will contribute to customer file growth over time. We believe this is the prudent and profitable path and gives us the stability we need to continue to deliver on Project Athens in 2024. We also believe it sets us up nicely for customer file growth in 2025. Now I would like to touch again while Qurate’s business model is differentiated across retail and the value we bring to customers, vendors and celebrities. Starting with vendors. Our platform continues to be very attractive to both new and existing vendors.

We move meaningful volume and provide a scaled platform to connect with customers on a personal level and share product stories. We had impressive sell-through rates in Q4 across a range of price points and in particular on higher end products where we were able to demonstrate compelling value for unique products. For example at QVC, we offered Fire Light lab-grown diamonds from two carats to nine carats ranging in price from $1,300 to $5,000. The entire collection was well received selling out across sizes and products including a sold-out non-carat tennis bracelet. We also sold $5.7 million of Ninja Woodfire of electric smoker and outdoor grill moving 19,000 units priced at $300 a piece. At HSN, we sold out of a day [indiscernible] with a price point in excess of $1,000 over Black Friday weekend.

In Home Décor, we sold $6 million of Barefoot Dreams luxury throw on Cyber Monday. In Beauty, we sold 40,000 units of an Elemis cream in one day and 114,000 units of [indiscernible] velocity gift set in two days. The scale of this platform is very difficult to replicate and attractive to existing and new vendors. We debut a new brand in tights, Sheertex selling $2.4 million in just a couple of hours. We introduced a new leather handbag and luggage brand Hawkins that sold $340,000 in 11 minutes.

QVC and HSN have always been a home for celebrities engaging personalities and entrepreneurs. We welcome many familiar and new faces in the fourth quarter with a great pipeline planned for 2024. At QVC Lawrence Zarian launched BEAUTIFUL, an exclusive fashion collection of dresses, outwear and accessories.

In connection with the launch we conducted a satellite media tour with a nationally syndicated segment on Extra. At HSN, we teamed up with legendary singer Dolly Parton for the presale of our debut rock album Rockstar. Iconic Singer Chaka Khan launched her own perfume. Singer Katherine McPhee debut her jewelry line Radiance by Absolute. Erin Andrews launched her Sportswear line. Wolfgang Puck celebrated his 25th year with HSN with a new cook wear line. During his time with HSN, he has generated $600 million in sales.

Numerous other celebrities have teamed up with us recently and our 2024 celebrities lineup is fantastic. In January, Scarlett Johansson debuted a new beauty line called the Outset. Actress Christina Ricci came on air as the new brand ambassador for Lancer Skincare.

Believe QVC’s Competing Against TikTok? We Have A Bridge We Can Sell You

One of our favorite TV shows is quirky “Resident Alien” on SyFy, where the main character’s favorite phrase is “This is some bullshit.”

And that’s what we said after just finishing reading The Philadelphia Inquirer’s recent story on Qurate Retail, parent of QVC and HSN.

Every good story has a so-called “angle,” a hook that explains why the article is being written now. Here’s the “hede” and “deck” — as we’d say in our business — on the Qurate (stock trading for pennies) story and QVC’s financial woes:

QVC helped pioneer shopping from home. Here’s how the company is changing — and competing against TikTok.
Celebrity hosts have peddled clothes, electronics, home goods, and jewelry since the 1980s. Now they’re up against TikTok.

WTF? TikTok?

How many of us QVC shoppers think it’s main competition is TikTok? TikTok is for a younger demo, like our 24-year-old niece. She would not be caught dead watching QVC, let alone buying any clothing or anything else from it.

Amazon, briefly mentioned in the Inquirer story, is QVC’s problem. So is Target and Walmart, and T.J. Maxx and Marshalls. Any Maxinista knows you can pick up Patricia Nash and Dooney & Burke purses at fraction of what QVC charges at that off-price retailer. Same for many of the shoe brands that the home shopping network hawks. And the same for many other products.

QVC shipping charges are ridiculous, while others ship free. That’s not a problem?

Qurate CEO, David L. Rawlinson II, is one cool cucumber when he downplays QVC’s problems. He must be a great poker player. He sure knows how to shovel the sh-t.

The Inquirer story is behind a paywall, but we were able to get past it. We hope you can, too.

https://www.inquirer.com/business/qurate-qvc-rawlinson-malone-maffei-20231124.html

Here’s a graf from the article.

With traditional TV services like Comcast Xfinity losing customers, Qurate has lately launched QVC and its smaller, Florida-based HSN channel through services such as Roku, Amazon Free, and Vizio Smart TV, and are also available through Qurate’s new livestream app Sune. The company says that more than two-thirds of its revenues now comes from computer and smartphone shoppers.

Folks, hate to tell you but just because you’re on Roku doesn’t mean your sales will spike. You have been available to the world online for years, and your sales are still slipping!

And here’s another gem from the story.

Today QVC, the West Chester-based core of Qurate Retail Inc., which includes clothing brands and small U.S., Western European and Japanese shopping channels, is struggling to cover its costs. It’s competing in a new world where it can be surprisingly cheap for energetic individuals working from home to reach millions of consumers through fast, slick product posts on TikTok (which QVC also uses) and other smartphone-based media.

Yep, TikTok — not the savvy retailers we mentioned — is QVC’s big competition and problem.

Not.

But after all, Rawlinson isn’t exactly a QVC expert. He described host David Venable as a celebrity chef on a recent earnings call.

QVC, HSN Parent Names Successor To Mike George

We won’t have Mike George to kick around for very long soon.

Qurate Retail, owner of QVC and HSN, on Tuesday announced that David Rawlinson II will assume the role of president and CEO effective Oct. 1. He will succeed George after a two-month transition period, beginning Aug. 1, during which time Rawlinson will serve as president and CEO-elect.

Prior to joining NielsenIQ as CEO, Rawlinson was president of Grainger Global Online, where he led the fastest growth, stand-alone division of W.W. Grainger Inc. , a Fortune 500 firm. Under his leadership “the business grew double digits every year and won multiple national awards for workplace culture,” Qurate said in its press release.

Rawlinson has also held executive roles with ITT Exelis, formerly ITT Corp. He also served a Presidential appointment as a White House Fellow and held various appointed positions in both the Bush and Obama administrations.

In the Obama Administration, he was a senior adviser for economic policy with the White House National Economic Council. He has an MBA from Harvard Business School, a JD from the University of South Carolina School of Law and is a graduate of The Citadel, a tough-ass military school.

Impressive.

From Oct. 1 until his retirement at year-end, George will serve as a senior adviser to Qurate to assist in transitional matters. Effective Jan. 1 next year, and concurrently with George’s retirement from Qurate’s board, Rawlinson will join the board. Qurate had announced in November 2020 that George would be retiring from the company at the end of this year.

“We are pleased to welcome David Rawlinson to the Qurate family. David brings an impressive track record of success, most recently with two storied brands, Nielsen and Grainger,” Greg Maffei, Qurate Executive Chairman, said in a statement.

“At these companies, David was a transformational leader and successfully managed the businesses through evolutionary transitions,” Maffei said. “His knowledge of global e-commerce, understanding of consumer trends and focus on mission and culture as a purpose-driven leader make him a natural fit for Qurate Retail.”

And here are Rawlinson’s words of wisdom.

“Qurate Retail operates as a unique and powerful enterprise. The world of shopping has been forever changed by the pandemic and these brands have the international scale, customer affinity, and expertise in driving and meeting demand across multiple platforms to define the future of experiential retail.”

“QVC and HSN pioneered home shopping and are now set to define a new world of seamless shopping. Zulily, Ballard Designs, Frontgate, Garnet Hill and Grandin Road are all focused and modern brands with passionate customers and unique value propositions. Together, Qurate Retail is in a strong position to drive value for our customers, shareholders, communities, and employees. I look forward to working with the exceptional team at Qurate Retail and I am grateful to Mike for being such a capable and values-driven leader for the company.”