HSN is turning to its website and a new catalog business to help boost revenues.
By Stacie Kress Booker
Most people know the Home Shopping Network from its TV pitches, but the St. Petersburg-based retailer of everything from electronics to clothing and jewelry is hoping a new strategy has more shoppers buying online and, soon, through its new catalog.
HSN, started in 1977, reaches more than 154 million homes worldwide. It ships as many as 110,000 packages daily and last year posted a profit of $135 million on revenues of $1.8 billion.
But HSN's parent company, USA Networks, is pressuring the company to do even better, particularly against rival QVC, which has seniority and greater market share.
HSN hopes to build on the early success of its website, HSN.com, which contributed $40 million to revenues last year, its first year in business. The company recently added a catalog business to its mix when it purchased the Improvements brand catalog and website from Hanover Direct Inc. this summer. Its job now will be to cross-promote its products over the air, online and through its catalog.
CEO and President Mark Bozek says that despite the slowdown in spending as the economy faces a recession, "We are in far better shape than a bricks-and-mortar retailer, certainly better than anybody that's trying to do this online." Bozek sees an opportunity to "grab more wallet share" through what he refers to as the circle of commerce -- TV, internet and catalog.
Consumers who shop via HSN's on-air and online site spend 25% more on average than just on-air shoppers, he says.
But USF marketing professor David Ortinau cautions that the home-shopping retailer faces a critical time. HSN isn't more insulated than traditional retailers, he says. "When people are afraid to shop," says Ortinau, "it will be a universal, across-the-board hit."
One factor in HSN's favor: It will be able to control costs better than traditional stores, Ortinau says, because of its lower overhead and its ability to stock less inventory than a traditional store, which needs to keep its shelves stocked and racks full to draw shoppers.
Christopher Dixon, an analyst with UBS Warburg, says HSN's future lies in its strategic positioning as the world becomes more interactive. "HSN has gone from a sleepy second-tier retailer across television to actually putting together the infrastructure which will allow it to take advantage of cross-platform advertising and selling in a screen-based society."
In the News
Clearwater -- Digital Lightwave (Nasdaq-DIGL) is cutting 40 jobs and reducing executive salaries up to 20% in the wake of a disappointing third quarter. The company, which manufactures fiber-optic network testing equipment, had been touted as one of the best-performing public companies in the region.
Medical and dental equipment manufacturer Boyd Industries bought an additional 2.5 acres adjacent to its main facility to expand its warehouse capacity.
Morton Plant Hospital's new $17-million, state-of-the-art emergency room is up and running. The 37,000-sq.-ft. facility doubles the hospital's emergency-care capacity. One of the major goals for the unit is to decrease patient waiting time.
Fort Myers -- Mel-Re Development recently completed two medical buildings at the HealthPark Medical Center complex. One, a class "A" medical office building, will house a physicians group of the Lee Memorial Health System. The other is an urgent care walk-in clinic with a pharmacy.
Manatee County -- PPi Technologies, a high-tech packaging company, won the No. 1 spot on the Florida High Tech Corridor Fast 50 list, sponsored annually by Deloitte & Touche. This year's Fast 50 list merged the Tampa Bay Technology Fast 50 and the Central Florida Fast 50, expanding the region covered to 21 counties.
Sarasota -- Schroeder-Manatee Ranch Inc. unveiled plans for another 5,000-acre, 7,000-dwelling, mixed-use community at Lakewood Ranch. Groundbreaking for the series of lakefront communities to be called the Villages of Lakewood Ranch is at least five years away.
St. Petersburg -- Echelon Development is seeking a second extension, this time for one year, from the city for its proposed Town Center in the Carillon business park. Echelon cited the soft economy as a major factor. Original plans called for a full-service, 300-room hotel, a 20-screen theater, apartments, retail and restaurants. The hotel is still in the works, but the theater has been scrapped.
Tampa -- Verizon is adding 110 jobs, paying $55,000 each, at its data center in Tampa.
Sykes Enterprises (Nasdaq-SYKE) is ramping up hiring because of increased demand from technology and communications clients. The company expects to fill 1,200 technical support positions by year's end. Some of those jobs will be at its call centers in Palatka and Marianna.
Walter Industries (NYSE-WLT) is cutting its headquarters' staff by 11%, or 34 jobs. The company is also considering cuts at its subsidiaries.
The number of flights scheduled for this month at Tampa International Airport is down 7.6% from last year. But the airport is faring better overall than the national average in the wake of the terrorist attacks. The airport's passenger count for September fell 27%; nationally, the average drop was 34%.
Ybor City welcomed two newly completed office projects: Kforce's new corporate headquarters and Ybor Square, an historic cigar factory that has been renovated as class "A" office space. Kforce (Nasdaq-KFRC) began construction on its $30-million, 36,600-sq.-ft. office complex last October. Ybor Square was developed by Orlando-based ZOM Development.
Job-boosting Task Force
TAMPA -- Enterprise Florida has tapped Tampa Bay Partnership President and CEO Stuart Rogel to head a new Team Florida task force designed to help companies rebound from the economic slowdown.
Among the task force's first agenda items: A Tampa Bay Partnership initiative aiming to speed up public works projects. The partnership presented a list of 200 projects totaling more than $1 billion in potential construction to the governor and the Legislature during the special session. "There's not a detailed list like ours being produced around the state," Rogel says. "The intent is to generate immediate job creation."