HSN reports 12% lift in digital sales

It was a strong quarter for HSN Inc. The company announced this week that net sales grew 8 percent in the first quarter, up 10 percent for the HSN brand and up 4 percent for Cornerstone. But digital in particular stood out for the quarter, posting a 12 percent increase overall for the company and an 18 percent increase for the HSN brand.

The strong quarter can be attributed in part to digital, which now accounts for 41 percent of all sales for HSN. The success was also driven by strong investments made in the past few years in the digital business as well as in data analytics.

Overall customer growth for the quarter was 6 percent, the highest growth rate since 2005.

Content is king for the retailer across all platforms, from watching demonstrations of products on television, to tablets and mobile phones. Now the company even has a second channel on HSN to highlight the consumer experience. Though HSN is a retailer first, the company brings to life the products through content.

"We've always been a content creator and that's one of our major focuses overall," said Judy Schmeling, COO and CFO of HSN. "We continue to make improvements. We take the feedback and react to what consumers want and turn those insights to bettering our content creation."

The company partnered with IBM a few years ago in efforts to store all of the company's data on one centralized platform to get better insight into activity. Last year, HSN began the second part of a campaign management program to create one consistent message across all platforms.

"We began testing last year and ramped it up this year, making a more personal connection with the customer," Schmeling said. As a result, HSN has seen an increase in the rate at which customers assimilate—the rate at which they make a repeat purchase in the first 90 days.

Along with the quarterly results, HSN announced the expansion of its partnership with Margaritaville Enterprises, intended to bring a range of Maragritaville-inspired culinary, home, electronics, beauty and apparel products to HSN and the Cornerstone division brands, Frontgate and TravelSmith. The largest partnership of the year to date, it includes 142 home products on the Frontgate website and a mix of apparel, swimwear and accessories to be launched on TravelSmith in mid-May.

Looking forward, HSN wants to continue to redefine the shopping experience. Using the company-coined terminology "boundry-less retail," Schmeling stresses the importance of dismantling barriers to create a frictionless shopping experience for customers.

Schmeling did not seem phased by the growing significance of HSN's online presence (now accounting for 50 percent of all sales), adding that HSN was the first retailer on mobile and the first to launch a website in 1997. "Like most retailers, we saw where the business was heading," she said.

For more:
-See this HSNi press release

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