1-1. QVC McGraw-Hill/Irwin Strategic Management, 3/e Copyright © 2007 The McGraw-Hill Companies,...

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Transcript of 1-1. QVC McGraw-Hill/Irwin Strategic Management, 3/e Copyright © 2007 The McGraw-Hill Companies,...

Page 1: 1-1. QVC McGraw-Hill/Irwin Strategic Management, 3/e Copyright © 2007 The McGraw-Hill Companies, Inc. All rights reserved.

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Page 2: 1-1. QVC McGraw-Hill/Irwin Strategic Management, 3/e Copyright © 2007 The McGraw-Hill Companies, Inc. All rights reserved.

QVC

McGraw-Hill/IrwinStrategic Management, 3/e Copyright © 2007 The McGraw-Hill Companies, Inc. All rights reserved.

Page 3: 1-1. QVC McGraw-Hill/Irwin Strategic Management, 3/e Copyright © 2007 The McGraw-Hill Companies, Inc. All rights reserved.

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QVCIcebreaker Question

Have you ever shopped at QVC? Or at the Home Shopping Network? If so, what did you think of it? What kind of items would you buy on QVC? Why? Why not others?

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QVC

1. How did QVC become the industry leader?

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QVC

2. What strategy did QVC use? How did it support its strategy?

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QVC

3. What challenges does QVC face? How has it confronted them?

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Q1. Strategy Formulation

Joseph Segel saw opening because of Home Shopping Network’s poor programming and downmarket products

Pursued growth strategy through: Acquisitions Vertical integration Merchandising quality Developing a vendor network Focusing on customer service

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Q2. QVC’s Strategy

Differentiation 24/7 virtual shopping mall Theme-based programs with celebrities Infrastructure – 7000 phone lines, 48-hour

shipping 30-day money back guarantee Quality control National brands to attract customers

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Q3. Challenges

Lower operating income in 2004 (13.36% vs. 16.90% in 2002).

Difficulty in selling higher margin items. Success in selling electronics and home

appliances Less success in selling beauty products, apparel,

cooking items

Foreign expansion successful, but effect not felt on bottom line

iQVC complements QVC but has not increased profits


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