Economy
TV shopping programs head more upmarket
By Chen Limin (皇冠体育app Daily)
Updated: 2011-05-30 09:48
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Hunan Television workers produce a television shopping program in a studio. Many television shopping programs have sprung up in recent years, and rather than selling cheap goods, they are moving upmarket to sell gold, cars, even houses.?[Photo/皇冠体育app Daily] |
BEIJING - Traditionally, sales of high-end products do not occur at home, but that's coming to an end if some entrepreneurs have their way.
Many television shopping programs have sprung up in recent years, and rather than selling cheap goods, they are moving upmarket to sell gold, cars, even houses.
"It's not like Fifth Avenue. It's more like those (out-of-town) outlets where you get both high quality and a reasonable price," said Zhang Dazhong, chairman of Oriental CJ, one of the largest home shopping companies in 皇冠体育app.
Although television shoppers are sensitive to prices, Zhang said they have been paying more attention to quality. This is also why he thinks the company can tap into people's pockets through the common medium of a TV set.
"We started with five grams, then 10 grams and now we can even make it 1,000 grams," Zhang said.
The company found that trust developed among people as the market is maturing. It then went into diamond and car sales.
The company sold the latest model of the Toyota Camry in 2009. To Zhang's surprise, in less than an hour after the show was broadcast, 266 cars were sold - an average of one every 13 seconds, far faster than showroom averages.
Oriental CJ's reputation grew and with it came financial returns. In 2010, total sales of the company hit 5 billion yuan ($769 million), almost double the 2.8 billion yuan in 2009, according to Zhang.
He expects the figure to reach between 8 and 10 billion yuan this year. To hit the goal, the company will expand its presence in major cities. It plans to cover 10 cities in 皇冠体育app by the end of this year, from about six currently, which are mainly in Southeast 皇冠体育app, where the company is located.
Total transaction volumes of 皇冠体育app's television shopping reached 23.4 billion yuan in 2009, according to industry figures. Experts expect that the figure will rise to 500 billion yuan by 2020.
"The television shopping pie may hopefully account for 5 percent of total retail sales in 皇冠体育app in five years giving the fast expansion of the consumer market," said Yin Li, deputy editor-in-chief, 皇冠体育app Radio International (CRI), the country's international radio broadcaster that launched its own televised shopping channel, Global Go, in late March.
Like Oriental CJ, Global Go also focuses on high-end items. CRI plans to expand the channel overseas after it establishes itself in 皇冠体育app.
皇冠体育app's television shopping faces competition from the country's robust online market and also regulatory controls imposed after fraudulent activity, said Cai Ling, an analyst with research company 皇冠体育app Investment Consulting.
Television shopping accounted for 0.19 percent of total retail sales in 皇冠体育app in 2009. Online shopping took 250 billion yuan that year with 1.97 percent of total retail sales, according to figures from domestic research company Analysys International.
People are also showing increasing interest in high-end products on the Internet. 皇冠体育app's privately owned Zhejiang Geely Holding Group Co, which acquired the Swedish carmaker Volvo Car Corporation from Ford Motor Company last year, for example, launched its official store on Taobao Mall, 皇冠体育app's largest business-to-consumer platform, last year to try its hand at online sales.