As successful as home shopping channels have been on cable TV, they seem antiquated in a time of on-demand video and want-it-now-buy-it-now shopping.
Esther Kestenbaum, a Silicon Valley e-commerce veteran and co-founder of TheShops.TV, is re-crafting the traditional model of home shopping. TheShops.TV site streams on-demand video of the products for home shoppers.
That means no more waiting for a particular segment to air on QVC, Evine Live or HSN. TheShops.TV shoppers can call up a video on a phone, tablet or TV to learn instantly about it.
"We become the Netflix for shopping," Kestenbaum said. "Watch and shop for what you want when you want it."
The site was launched in April by Kestenbaum, who splits her time between Minneapolis and San Francisco, and Rod Ghormley, a former executive at QVC and ShopNBC, the Eden Prairie home shopping company now called Evine Live. Its main office is in Palo Alto, Calif., and it has an office in Eden Prairie.
Retail consultant Kevin Quinn of Styled Retail in Edina said he likes the way the site is more focused on shoppers' wants. "It adds an element of laser shopping so the customer doesn't have to wait for the announcement, 'We'll have Calphalon at the top of the hour,' " he said.
So far, the fledgling company has signed more than 120 brands and shot more than 1,000 videos with national and locally known hosts such as Carmela Sterling, Dave King and Shawn Diddy hawking Dell, Philips, Monster Cable, LG, Sony, Lenovo, Badgley Mischka and Dingo. B-level celeb Gretchen Rossi of the "Real Housewives of Orange County" sells handbags.
Kestenbaum isn't divulging sales, but she's counting on the decline of cable TV to build her base with the same demographic as cable-based home shopping — the 30- to 55-year-old soccer mom with $75,000 to $100,000 in household income.
"We're also diverging to get men with electronics, drones and jewelry for their spouses," she said.
The founders hope to attract more customers by offering free shipping and free returns on all products. "We said 'Let's do free returns' because we're new and people are taking a risk on a new business," said Kestenbaum. More important, none of the other shopping channels offers it on all items. The company might add a minimum order amount to qualify, but hasn't seen the need yet. The return rate hasn't become excessive, she said.
The founders also launched extended payment financing for six, 12 or 24 payments called XtendPay. The program is designed to get the consumer to buy more. "We see people buying two or three computers or outfitting an entire room," Kestenbaum said. "We expect it to increase greatly at the holidays."
Buying what you want when you want with a phone, laptop or internet TV has obvious appeal, but with no live programming, what keeps shoppers coming back? TheShops.TV employs some of the same enticements as cable shopping networks — deals of the day and a live countdown clock with extra discounts on the home page.
"We give people a reason to check in every day," Kestenbaum said.
The company is counting on growth as more consumers cut the cord. Nearly 50 percent of new households will never subscribe to pay-for-TV services, relying instead on video-on-demand services, according to tech research firm Gartner. By next year the number of TVs connected to the internet will have doubled since 2012 to 147 million, according to Statista.com.
Others believe that the rate of cord-cutting is exaggerated. Although subscriptions for streaming services have skyrocketed, many consumers use Netflix and other streaming services to supplement cable, rather than replace it. If cable loses only about 1 percent of its customers per year, TheShops.TV might be slow to rise.
Kestenbaum isn't fazed.
"The stopping of watching TV is more important to my business than cord-cutting," she said.
John Ewoldt • 612-673-7633
