06 597
Development of a sector with
a bright future: teleshopping
Silvia Sanz Blas
Isabel Sánchez García
Facultad de Economía
Universidad de Valencia
Abstract
Non-store selling represents an opportunity for many companies to diversify their activities in their business and expand their markets. Among all
direct methods of purchase, teleshopping is experiencing a great development in recent years thanks, in part, to the advances made in new technologies, allowing that television media becomes a very important tool for
trade all over the world. The outstanding broadcasting increase of this
kind of programs / advertisements, reflected not only in the channel’s broadcasting time and the apparition of prearranged images, but also in the
number of channels (regional, local and sale channels) and companies that
offer these services and the access to Internet through television are
aspects that encourage the development of this method of purchase. This
paper is focused in analysing the evolution of teleshopping along the time
with the aim of highlight its importance and identify the future trends.
Keywords: television media, teleshopping, new technologies.
JEL Code: M31.
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development of a sector with a bright future: teleshopping
1. Introduction
Teleshopping is a commercial non-store formula which has coexisted
alongside traditional methods since 1980 in countries such as Italy, France and the United States (Quelch and Takeuchi, 1981).
A brief review of the most significant studies in this field shows that
early research on Teleshopping focussed attention on the system’s benefits
and drawbacks, the target audience and in general the implications of
teleshopping itself (Foster, 1981; Martí and Zeilinger, 1982; Quelch and
Takeuchi, 1981; Rogers, 1982).
The literature on the above aspects of teleshopping was significant but
there was an evident lack of research on consumer attitudes towards the
new shopping system. By the end of the eighties, studies which focused
more on consumer attitudes towards teleshopping began to appear
(McKay and Fletcher, 1988) as it was acknowledged that the audience is
the potential user of the system and its attitude towards this type of services is of critical importance. The results of this new research facilitated
information on the levels of consumer demand for this type of shopping
and provided guidelines for television organisations to direct the teleshopping market to the most advantageous areas.
In Spain, studies continue to concentrate on the system’s main advantages and disadvantages, the target audience and levels of demand for this
type of shopping. Studies in other countries (Grant, Guthrie and BallRokeach, 1991; Skumanich and Kintsfather, 1993, 1998) have extended
the scope of research to analyse the possible links and relations the teleshopper has with this type of advertisements and/or programmes and their
influence on the purchase, and the background or precursors to these relations.
In Spain, very little research has been done up to now why this sales
formula did not start until the early 1990s, the date when the first studies
began to appear. The most relevant of these studies being both market studies on shopping habits in the new sales systems carried out by the Instituto Emer in several regions of Spain and the research done by De la Balli-
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na and González (1993), Sanz (2002), Sanz and Sánchez (2002a, 2002b)
where this new sales formula is analysed in detail.
Currently, there is a clear interest in studying interactive television and
Interactive Home Shopping, as new, significant developments which are
obviously driving or will drive in the not too distant future to the growth
and importance of this type of non-store sales. However, there is a marked
lack of interest in the traditional television sales formats. Interest in this
field should be revived since these formats are at present the most commonly used and in the more immediate future, they will continue to complement the more innovative formats.
This lack of interest and little research have encouraged us to study
television sales in more detail. The objective of this work is to analyse, and
thus highlight the growing relevance and importance of teleshopping, how
the system has developed over time and its expectations for future development.
2. Teleshopping origins
Sales through television channels began in Italy around 1980 then appeared in the United States and two years later were introduced in France. In
the early stages, teleshopping services worked through an interactive system which allowed subscribers to send messages to their information providers who, in turn, were able to provide transactional services such as:
placing standing orders, home banking and teleshopping (Marti and Zeilinger, 1982; McKay and Fletcher, 1988).
The interactive facility stemmed from the fact that the shopper could
not only receive general information on the sales organisation, but could
also ask about available stocks, price, colour, size and even order a chosen
item (Thompson, 1997). To make teleshopping available, the television set
was connected to a minicomputer in the retail establishment by ordinary
telephone lines. Consumers could order their products from the lists which
appeared on the tv screen. At first, the information was only static and
written, and so there were no images.
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To place an order, the shopper pressed the appropriate buttons to
introduce the item code number and the desired quantity. The consumer’s
shopping list detailed item by item appeared on the screen with the corresponding account. The consumer could even recover old shopping lists
because they were stored in the seller’s computer memory. Repeat orders
could be quickly confirmed, items could be deleted and new items could
be added before completing the transaction.
When the order was finalised, it was recorded in the shop computer and
was printed out in the form of a purchase order. The products were prepared by the staff in the shop for delivery to the consumer. In the majority of
cases, delivery took place at the shop’s convenience, but in other cases, at the
time requested by the shopper. Payment was in cash, by cheque or credit
card as decided by the organisations participating in this new sales system.
While teleshopping could appear an attractive proposal in some
aspects, the system also had some limitations (see Table 1). Marti and Zeilinger (1982) paid special attention to the drawbacks of teleshopping,
from the consumer’s point of view, and at that time the most serious disadvantages were:
1. The fact that the television was not available for watching programmes or the phone for making calls.
2. Possible risk of error if a mistake was made selecting the item codes.
3. The lack of a printed version to detect any possible errors.
The first of the above problems was classified as minor, as these defects
could easily be solved. Obviously the consumer would choose to shop by
television when his favourite programmes were not on, or when there was
no need to use the phone. The last two were more problematic. In any
case, the majority of consumers were probably not dissuaded from teleshopping by just these setbacks.
The above list of drawbacks was extended thanks to research by other
authors such as McKay and Fletcher (1988), who after a study of consu-
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mer attitudes towards teleshopping concluded that most of those interviewed were opposed to the alternative of shopping by television on the basis
of the following criticisms:
1. It meant a loss of social contact, emphasising the social function of
traditional shopping.
2. It did not offer the visual stimulation of shopping in a shop. The physical aspects of the product, such as presentation and packaging were
decisive when shopping and teleshopping was incapable of communicating this information through photographic presentations. The
products, reduced simply to words and figures, lost aesthetic attraction and therefore the temptation to buy them. The lack of visual stimulation was a clear drawback to the teleshopping system.
3. Teleshopping was perceived as something not very interesting and
lacking in mental stimulation. It was synonymous with lack of choice. It limited the number of products available, as all the items
carried by a shop could not reasonably appear on the screen. Teleshopping therefore, did not offer as wide a range as the traditional
shop.
4. It was not very suitable for buying perishable goods, clothes or
footwear. These products are thought to need a priori examination
before the purchase.
5. The benefits of home delivery also had negative aspects, such as the
need to wait until the products were delivered, receive unwanted
replacements, discover some items had run out and generally, receive products in poor condition. There was special emphasis on the
need for an efficient customer service to reduce the inconvenience
of having to return items.
6. The price of the products. The consumer did not consider that the
purchases were competitive on price, since in addition to paying the
price of the product, other costs also had to be paid, such as transport costs.
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(1) It should be noted
that several authors have
worked on the concept
of teleshopping, in the
Table 1. Initial limitations of teleshopping
early stages, as a very
wide concept, including
the purchase of items
from the television or
from the computer or
telephone. Other authors
extended the concept
even further, including
under teleshopping any
other method of non
store sales, i.e. any type
of sales which could be
made from the
customer’s home,
including catalogue or
postal sales, which
together with television
were included in the
term Direct Marketing.
1. Television not available to watch television programmes.
2. Telephone not available to make calls.
3. Risk of error when selecting item code numbers.
4. Lack of printed copy of the order to detect any errors.
5. Loss of social contact.
6. Lack of visual stimulation.
7. Lack of consumer interest in the service.
8. Limited number of products available.
9. System not appropriate for the sale of products such as: perishable goods,
clothes and footwear.
10. Problems with the product delivery service.
11. Lack of efficient customer service.
12. Uncompetitive prices.
Source: Adapted from Marti and Zeilinger (1982) and McKay and Fletcher (1988).
There were therefore, several reasons which indicated the possible failure of teleshopping (seller’s operating costs, the range of products or legal
barriers), with one of the clearest reasons being the lack of consumer interest. This, at first, caused doubts as to the future commercial feasibility of
the teleshopping service1.
In Spain, television sales started in the early 1990s on private channels.
Teleshopping programmes were first broadcast with the launch of Antena
3 television. Through “La Teletienda Antena 3” this type of programme
was introduced in a totally new way. These television sales slots were characterised, at first, by their serious nature, since presenters rarely appeared, it was mostly shots of the products announced with an off-camera
voice commenting on them. There were also no testimonies or commenta-
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ries from the people who created the products or used them. These programmes were broadcast at different times: in the mornings from 11:00 to
12:00, in the afternoons at 15:30, 17:15, 18:30 and finally at 19:00 (Castelló, 2002). Until that moment, only those with a parabolic aerial had
access to some teleshopping programmes.
3. Current situation of teleshopping
In comparison with its beginnings, the concept of teleshopping has evolved considerably. Nowadays, some of the problems perceived by consumers to hinder the development and introduction of teleshopping appear
to have been solved (visual stimulation, appropriate knowledge of the products, efficient customer service and competitive prices). There is no doubt
that this commercial non-store sales formula has recently been experiencing significant developments both in Spain and other EU countries and
has spectacular perspectives for growth. Teleshopping (teleshopping programmes or infomercials) can therefore be viewed as one of the most promising methods for the sale of goods and/or services, thanks especially to
the new technologies that continue introducing new ways to access products and to purchase them from the television set.
In addition, given that the television is extremely popular and is present in practically all households (CIS, 1997; EGM, 2005; El País, 1999;
Núñez, 2000; MECD, 2002; SEDISI, 2000), sales through this medium
are becoming an extraordinary force within commercial distribution (Díez
de Castro, 1997; Gómez, 1995; Miquel, Parra, Lhermie and Miquel,
2006; Whitford, 1994). Therefore the phenomenon of teleshopping which
started approximately twenty years ago, has very promising possibilities
for development (Carcasona, 1994, Gómez, 1995), as indicated by the fact
that, currently both private and state-run channels, including the regional
and local channels, have slots dedicated to sales. Some foreign companies
broadcast through Spanish channels and others in channels which can be
seen with parabolic antennas, as for example Galavisión (teleshopping) or
Sky Channel (Quantum Int. Ltd.), with well organised distribution logis-
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tics in order to sell their products in Spain. Exclusive sales channels are
even beginning to appear where it is possible to shop 24 hours a day
(Ono’s teleshop EHS (European Home Shopping)). In addition to the above is the inclusion of sales in certain programmes, such as entertainment
programmes, where the presenters present and sell the products (for example the sale of “Lo Monaco” mattresses in the programme “A tu Lado”).
In these cases trust in the presenters generates greater credibility for the
products and therefore increases sales.
At present, three types of television sales are being developed most in
Spain (see Table 2). Firstly, there are direct response advertisements, similar to conventional advertising but with a slightly longer duration (around
two minutes), secondly the teleshop or video-catalogue programmes
(which last about 15 minutes), and thirdly infomercials, long lasting sales
programmes (up to 3 hours).
Of these three, the most popular among the public are the video-catalogue programmes (Sanz, 2002), of which A3D, from Antena 3 TV was one of
the most successful until its disappearance. It had more than 900,000 clients
and consolidated as the leading Spanish company in the direct sales sector
(A3D, 2003). In the year 2000 its turnover was 27.04 million euros using the
channel’s least saturated advertising slots (Barrio and Nieto, 2003).
Table 2. Types of teleshopping
TYPES
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CHARACTERISTICS
Conventional direct
response advertising
• Short duration (between 60 and 120 seconds).
• A single product is offered.
• A telephone number is given to acquire the
product
Video-catalogue/teleshop
programmes
•
•
•
•
Minimum duration of 5 minutes.
Maximum duration of 15 minutes.
Several products are offered.
A telephone number is given to acquire the
product.
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Table 2. (Continuation)
TYPES
Long sales programmes
(informercials or
infocommercials)
CHARACTERISTICS
• Minimum duration between 15-20 minutes and
half an hour (only one product is shown).
• Maximum duration up to 3 hours (several products are advertised).
• Broadcast in cheap and/or low audience time
slots.
• A telephone number is given to acquire the
product.
Source: Original work.
These three forms of sales are included within the traditional teleshopping systems since, in all of them, the client requests the product by phone and it cannot be acquired any other way. Contact is made with the supplier of the goods or service and the sale is finalised by phone (Bragg,
1987; Díez de Castro, 1997; Gómez, 1995; Linke, 1992; Miquel et al.,
2006; Quelch and Takeuchi, 1981). Nowadays in Spain, in comparison to
other countries, telephone ordering is the most used system and is therefore still the current system.
In addition to these traditional teleshopping systems, where the client
makes a phone call to request a product/service, with the appearance and
development of new technologies such as digital, satellite or cable TV (see
Graph 1), the opportunity to shop directly (for programming or products/services) is being offered on non-sales channels which is thus leading
to a complete rebuiliding of the television infrastructure (Grant, Guthrie
and Ball-Rokeach, 1991). Thus, thanks to the development of interactive
television, the consumer can purchase direct from the television set by
simply pushing a button on the remote control, and charge the cost of the
purchase to his credit card or bank account (Blake, 1996; Lee and Lee,
1995; Levy and Weitz, 1998; Linke, 1992).
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Graph 1. The role of new technologies in sales
Satellite
Internacionalisation of slots
Cable
Consolidation of new chains
Terrestrial
• Programming specialisation
• Adaptation to specific segments
• Additional services:
•
•
•
•
•
Home banking
Telephone
Telework
TELESALES
Internet Access
SALE BY
TELEVISION
Source: Original work.
In addition, it should be mentioned that the consumer is beginning to
have Internet access through the television set, which promotes yet further
the development of television interactivity between the televiewer and the
medium (Blake, 1996). Thus, the customer can view the catalogue of
goods/services offered by different companies on his television screen,
make his choice and buy the products after comparing ranges, conditions,
prices and brands (Bliwas, 2000; Bramley, 2000; Caswell, 2000; Clawson,
1999; Frederiksen, 1997; Leonardi, 1999; Techtrends, 2000; Thompson,
1997; Yorgey, 1997).
This new form of teleshopping (Internet), already available on the market for some companies, still has a very low level of introduction, and is
therefore mentioned in this work as a future teleshopping formula, with
perspectives for rapid growth on the Spanish market.
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In other countries such as the United States and the United Kingdom,
television is very highly developed and an example of this is the fact that
interactive television and Internet by television have been available for
some time, as have exclusive sales channels for products and/or services.
Cable and satellite television are also good precursors for all these services, as they take advantage from their high number of televiewers to make
significant sales through teleshopping2. These more innovative services are
beginning to be developed now in Spain.
In the United States, home shopping is a very powerful distribution channel, and there are more than 500 channels dedicated to this type of sales
(Underwood, 1993; Whitford, 1994). The variety of products marketed is
immense, with items from 12 euros to over 1,200 on sale (Ridsdale, 1993),
with jewellery and cars being the most successful products (Whitford, 1994).
On the North American market there are even independent Spanish
language stations broadcasting sales programmes in Spanish, in order to
reach a relatively wide audience such as the Hispanic market3 (Shermach,
1997). This market shows a predisposition or favourable attitude towards
advertising and direct marketing, considering that both are important
information sources (Korgaonkar, Karson and Lund, 2001). Nowadays,
the telesales industry in the United States is worth over 2,000 million
dollars (around 2,103 million euros).
At present, one of the leading television channels in the teleshopping
sector is QVC (Quality, Value, Convenience), which has been operating for
over 15 years in the United States and, since a few years ago, in Canada,
Mexico, Japan and Europe (France, the United Kingdom and Germany) as
well (Stephens, Hill and Bergman, 1996). In 1992 this great teleshopping
chain had a loyalty rating of around 60%. Out of every 10 viewers who
made a purchase, 6 purchased again (Stephens, Hill and Bergman, 1996),
this loyalty rating was maintained in 1997, together with the incorporation
of 150,000 new clients every month (Thompson, 1997). Currently, it is present in more than 64 million households in the United States and around 6
million households in the United Kingdom (Leonardi, 1999).
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(2) An example of the
huge potential and scope
of this medium is the
promotion of Frank
Coffey’s book which in
one of the sale
programmes broadcast
(QVC) in only 5 minutes
sold 2,000 copies, with
total sales of 8,000
copies over the total
duration of the
programme of just 17
minutes. (Whitford,
1994).
(3) Currently, the
Hispanic market has a
population of around 25
million people with a
spending capacity of
around 150 billion
dollars, justifying the
importance of this
market segment both for
advertising and direct
marketing (Korgaonkar,
Karson and Lund, 2001).
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development of a sector with a bright future: teleshopping
This leading sales chain achieved total sales of 1.6 billion dollars in
1995, with a 400 million dollar increase on the previous year (Underwood, 1996), and by the end of 1999 passed the 2.8 billion dollar mark
(Sullivan, 2000).
Although QVC was initially set up to market only cheap, low quality
products (such as costume jewellery), nowadays, with the aim of increasing its target audience, it offers a wide variety of products through its different sales channels (for example the Q2 and On Q channels), some of
which also specialise, among others, in family themed programmes,
health, sports, fashion, fitness and travel (Rubel, 1995; Solomon, 1994;
Thomphson, 1997; Underwood, 1996). Greater market segmentation and
variety of products offered to its audiences (more than 200 products per
hour) (Daugard, 1996) has meant that this company has recently begun to
attract a more discerning public, in a higher income bracket offering better quality products at a consequently higher price (Miller and Zapolin,
1996; Underwood, 1996). The company uses a persuasive sales system in
contrast to the aggressive sales system traditionally associated with telesales (Masko, 1997).
QVC’s business was extended in the summer of 1996 by incorporating
the service of shopping by PC (iQVC), offering its clients the opportunity
to acquire products not only by television but also by Internet (Galenskas,
1997; Underwood, 1996).
Another of the pioneering companies in teleshopping (founded in
1977) and also a market leader is HSN (Home Shopping Network). This
company, in contrast with the previous one, attracts the middle income
bracket consumer with lower price and lower perceived quality products
(Miller and Zapolin, 1996). Sales at the end of 1999 were over 1.2 billion
dollars (Sullivan, 2000).
Like QVC, this leading chain has also extended its business with the
Internet shopping service. This service started in 1995, a year before than
its most direct competitor (QVC), and in even that first year obtained a
turnover of 2 million dollars (Underwood, 1996).
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Together with QVC and HSN, other teleshopping chains such as Value
Vision (founded in 1990) and Shop at Home have also contributed to the
success of this sales formula4 (Andersen, 1999; Underwood, 1996). Thanks
to the development of these chains and in particular of the leading sales
chains, i.e., QVC and HSN (present in over 140 million households (Mermigas, 2001)), teleshopping has a promising future (Eldridge, 1993). In
fact, television sales have gone from 2.5 billion dollars in 1993 (Underwood, 1994) to 4 billion a year between the end of 1995 and 1996 (Miller and
Zapolin, 1996; Underwood, 1996) and around 6 billion dollars at the end
of 2000 and early 2001 (Mermigas, 2001). It is forecast that this figure will
increase by 1.5 billion dollars over the next 4 years (Mermigas, 2001).
4. Implications of direct sales for companies
All the indicators show that teleshopping will grow in the future. This will
mean a change in consumers’ lives but also an important change for companies who hope to increase sales through the television medium, either by
competing or doing business with it (Solomon, 1994).
The growing tension between manufacturers and distributors is increasingly pushing manufacturers to search for alternative sales channels,
which they often use in parallel with sales to large distributors, in order to
decrease their dependency (Gómez, 1995). In fact, for manufacturers, the
appearance and development of this form of sales means a further alternative (and in many cases a cheaper one) for making its products known
and offering them to consumers without having to invest in costly conventional advertising campaigns to do so (Carcasona, 1994; Hawthorne,
1998b; Masko, 1997; Whitford, 1994).
In addition, for the distributors, although this commercial formula
means greater competition for them, they can take profit from it, using it
to diversify their offer, as in the Spanish case of the El Corte Inglés5
(Gómez, 1995).
Thus, sellers who add a telesales component to their shop or business
can obtain a significant synergy (Barrett, 1996; Silverman, 1995; Solo-
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(4) Telesales for Value
Vision and Shop at Home
in the United States
reached 218 million and
150 million dollars
respectively in 1999
(Andersen, 1999).
(5) This major
distribution chain began
broadcasting in June
2001 a series-type
programme (Tele 5 in El
Corte Inglés) made in the
chain’s own stores,
lasting about 20 minutes
(from 10:00 to 10:20). In
these programmes, some
of the staff gave detailed
presentations of several
products which could be
purchased at the stores or
through the
programme itself by
phone. In total 4 or 5
products were advertised
per programme, some
were well known brands
and prices, in most cases
were over 30 euros. Along
with the phone number to
make the order, a guaranteed refund was offered,
and the possibility of paying with any credit card,
including the El Corte
Inglés store card. This
programme was
broadcast every day from
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development of a sector with a bright future: teleshopping
Monday to Friday as part
of the daily scheduling
and was even repeated in
the early hours.
(6) After the popularity
of the El Corte Inglés
products advertised by
“Tele Tienda”, the major
Spanish distribution
chain decided to go into
catalogue sales on its
own without
intermediaries. In late
1992 it set up an out of
store sales department
called “La Tienda en
Casa”. Customers could
place orders over the
phone or using the
coupon inside the
catalogue. The launch of
the first El Corte Inglés
postal sales catalogue
caused quite a stir
among the companies
already operating in the
business, who were
enjoying a particularly
favourable period
(Méndez, 1993).
mon, 1994; Webster, 1997). For example, in the case where the consumer
is not satisfied with the product purchased by television and providing this
product is available in the shop, he can either return it or change it
through the usual teleshopping channel or go to one of the advertiser’s
sales outlets. As a result, the consumers may end up visiting the shop and
buying more products there as well.
Nowadays, the large companies in the distribution sector, such as
Carrefour, have reached an agreement with teleshopping companies under
which some of the products offered on the television (reducing ointments,
gym apparatus, etc. ) are present throughout the chain.
In the same way, television has also appeared as a support to postal
sales (Dowling, 1997, Méndez, 1993). Currently, companies such as Spiegel and Time Warner, or El Corte Inglés6 in Spain, use telesales programmes to offer products from several of their sales catalogues, thus helping
to promote the catalogue business. The telesshopping channel is used to
generate orders by catalogue and simultaneously, the catalogue is used to
promote the telesales channel. The products which appear in the catalogue with the note “sold on tv”, sell more (Dowling, 1997).
Companies which do business using television sales need to realise that
sales through this medium may be both a blessing and a nightmare. Television is able to sell thousands of products in a few minutes; this means
that a small manufacturer needs to consider his production, stocks and
warehousing before the product is broadcast on television, in order to
meet whatever response there is to the advertisement. Replacing resources,
reviewing strategies used in several departments, subcontracting part of
the manufacturing process and not assigning so much capital to traditional advertisements are aspects which must be considered by the
sellers/manufacturers who anticipate they could grow by selling through
this medium (Solomon, 1994).
In addition, this commercial formula will allow the manufacturers/
sellers themselves to control the results in the short term, as they can be
observed and measured almost immediately (in a few hours, under a
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development of a sector with a bright future: teleshopping
week), so that the assumed risk is very controlled (Carcasona, 1994;
Cotriss, 1998; Danaher and Green, 1997; Díez de Castro, 1997; Hawthorne, 1998a; Kaye, 1999; Masko, 1997; Whitford, 1994).
Sellers who, initially, refuse to adopt telesales will have to develop new
formats to make the experience of in-store shopping more stimulating and
attractive, perhaps by providing entertainment, leisure activities or shows.
They will also have to use new technologies to help consumers buy more
easily and conveniently, such as for example introducing computer stations on sales floors so the consumers can find out about products, availability or future offers (Solomon, 1994).
The professionalism and good practices of the different companies operating in the sector (product quality, delivery terms, guarantees, refunds,
prices, etc.), European Union legislation7 on television-related issues, and
the development and definitive introduction of interactive television are,
among others, elements which will exert significant influence on the development of this type of sales.
06 611
(7) The legislation
increases the time
allowed for broadcasting
conventional direct
response
advertisements, giving
separate consideration to
sales programmes and
exclusive sales channels.
5. Perspectives of growth for teleshopping
The most immediate future of teleshopping in Spain is without doubt, the
development and definitive introduction of cable television and the digital
communication networks. From these new technological advances, telesales will benefit given that:
1.- More time will be dedicated to sales slots (Gómez, 1995), so the different channels will broadcast more programmes of this type (Wicks,
1991). The sales or catalogue programmes on a cable channel are usually
broadcast for around 30 minutes and can be shown to all the subscribers
as part of the regular broadcasting schedule or only to individual subscribers on request and at their convenience.
The availability of more broadcasting time will create, on the one
hand, more competitive markets, as more viewing options will be available for the televiewer and on the other hand will lead to lower prices for
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development of a sector with a bright future: teleshopping
television slots (Gómez, 1995). This will doubtless favour the rapid
growth of the traditional sales systems such as infomercials (long sales
programmes for products and/or services) (Carcasona, 1994), and the
development of new forms of catalogue programmes and commercial
advertising (Díez de Castro, 1997).
2.- Specific channels will be dedicated to the sales of goods/services
(Carcasona, 1994; Whitford, 1994; Wicks, 1991). This means that themed
direct sales channels will appear from which to shop 24 hours a day.
This formula will radically increase sales, as the consumer will be able
to specifically choose a channel on the television at any time of day from
which to teleshop and in addition, in the not too distant future, the service will be interactive (Blake, 1996; Thomphson, 1997; Whitford, 1994).
Thus, the traditional system of phone shopping will survive alongside interactive shopping systems where the consumer can transmit the order
through the television remote control (Blake, 1996).
3.- Internet access through the television set itself will be developed,
which will mean a significant extension to the market (Frederiksen, 1997;
TechTrends, 2000; Thomphson, 1997; Yorgey, 1997). In fact, most Internet and teleshoppers, together with subscribers to cable and satellite television are favourably disposed towards using this service (TechTrends,
2000).
There will even be combinations of sales programmes and Internet,
where the televiewers, by watching these programmes, will have direct
access from the programme itself to the company website, simply by clicking on the web address which appears on the screen, which will allow
consumers to see a product, select it and buy it using the remote control
while watching the sales programme, without the need for a computer or
a phone call. (Bramley, 2000; Caswell, 2000; Leonardi, 1999). In the United States, more than 80% of active teleshopping channel customers have
already stated their interest in this service and therefore that they are ready
to order and pay for the products through their television sets. Of these,
27% say they would pay a monthly fee for this service (TechTrends,
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development of a sector with a bright future: teleshopping
06 613
2000). This combination of Internet and telesales will surely help to overcome some of the limitations inherent in the use of Internet alone (Chiles
and McMackin, 1996; Frederiksen, 1997; Javenpaa et al., 1999; Lohce
and Spiller, 1998; Pavitt, 1997; Swaminathan et al., 1999).
In the United Kingdom, this interactive system has been available on
the market (on the Sky Digital channel) since late 2000 and has been developed by NDS (leader in problem solving for companies using sophisticated interactive technologies), in collaboration with the sales channel QVC
(Bramley, 2000). In the same way, this system has been developed by
Worldgate Communications Inc., also in collaboration with the sales
channel QVC, with the aim of introducing a new form of impulse buying
in the sphere of e-commerce (Leonardi, 1999).
It is predicted that in the short term, the television will be a direct response medium, with a significant change towards commercial advertising
or programmes of the dot.com type, designed so it is possible to place
orders straight away, request further information or visit the company’s
websites (Bliwas, 2000; Card et al, 2000; Caswell, 2000; Clawson, 1999;
Leonardi, 1999).
In Spain, the first platform offering Internet services through the television was Quiero TV, with more than 80% of subscribers using this service (Gómez, 2001a). The offer ranged from several interactive television
channels to services such as: e-mail accounts, mobile messaging, participation in forums, chats, food home delivery and shopping (books, music
and electronics, insurance, bathroom fittings, etc.) (Marín and Marcelo,
2002). The concept Quiero Tv tried to transmit was that of participation,
inviting all viewers to be an active part of the channels. However,
currently, Quiero Tv no longer offers its services to the market, the main
reason for its disappearance being its high risk business plans to compete
with other pay-to-view channels. Outstanding, among others was the huge
investment made both to capture customers and purchase contents which
exceeded subscriber generated income by more than 100% (Noticias de
Comunicación, 2002).
september · december 2006 · esic market
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development of a sector with a bright future: teleshopping
Internet-television convergence is becoming increasingly apparent
(Carton, 2001; Dunphy, 2001; Kelling et al., 2000; Kenny y Marshall,
2000; Long, 2001; Robins, 2001; Serena, 2000), both in terms of technology and content (linn, 1999). However, despite the similitude between
both media there are significant differences with respect to choice motivations and media use, giving rise therefore, to different benefits for each of
them (Heeter, 2000; Kelling et al, 2000). In addition to the above, it is difficult to make these new services profitable and the television infrastructure itself is resistant to change, all motives which may mean that Internettelevision convergence is still some time away (Gómez, 2001b).
6. Barriers to the use of the teleshopping system
Although everything seems to suggest that teleshopping will benefit from
the development of cable and, digital communication networks, it should
be noted that there are a series of barriers or obstacles to introducing product sales which may be a break on access and interest for companies. We
refer to three main barriers: the cable operator, policies and costs.
Firstly, it should be noted that cable operators, up to now, have not
been very enthusiastic about commercial advertisements/programmes, since these operators have focussed mainly on obtaining income from subscribers rather than advertising, and are fairly sensitive to including it.
Secondly, advertising programmes are not always considered positive,
as they can lead the consumer to impulsive and/or compulsive buying of
things which are really of no interest to him (Beatty and Ferrell, 1998;
Christenson, Faber, De Zwaan, Raymond, Specker, Eckern, MacKenzie,
Crosby and Mitchell, 1992; Cobb and Hoyer, 1986; Donthu and Gilliland, 1996; Faber, 1992; Faber, O’Guinn and Krych, 1987; O’Guinn and
Faber, 1989; Ridsdale, 1993; Roberts, 1998; Rook, 1987; Rook and Fisher, 1995; Thomas and Quindry, 1999).
Finally, the operators see commercial advertisements/programmes as a
type of publicity and therefore, expect some type of compensation. Normally
the operating station, in exchange for inserting an advertisement for free,
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development of a sector with a bright future: teleshopping
receives a percentage of the sales (usually 3-5%) generated by the orders
transmitted by telephone or the interactive systems8. As with a conventional
advertisement, it is also possible to buy an advertising slot to broadcast the
advertisement/programme (Bragg, 1987; Cotriss, 1998; Daugard, 1996;
Eicoff, 1995; Gómez, 1995; Mermigas, 2001; Quelch y Takeuchi, 1981;
Ridsdale, 1993; Whitford, 1994). In the latter case, according to the duration
of the telesales slot and the broadcasting time, the operator invoices the company which sells the products as though it were just another advertisement
(Cotriss, 1998; Gómez, 1995). Low audience time slots are usually used to
broadcast this type of programmes and this is therefore an important resource to mitigate the possible advertising crisis (Barrio and Nieto, 2003).
Cable operators’ lack of interest, the negative view received by political agents and the costs generated by broadcasting the advertisements/programmes are some of the reasons why companies may abandon the idea
of getting into the direct sales market through the television medium.
7. Conclusions
Sales through the television medium is an interesting option for companies
who want to expand their markets and diversify the offer of their products/services.
This direct shopping formula, which appears as a complementary method to in-store sales, is currently undergoing significant development and
is quite popular among consumers, boosting the importance of the television medium as a distribution and sales channel.
The increase in the broadcasting of advertisements and/or sales programmes and the number of channels and companies which offer them,
the appearance of exclusive, 24 hour a day shopping channels and the sale
of products through certain programmes are, among others, aspects which
show how important this shopping system is becoming.
In addition, it must be noted that thanks to the liberalisation of telecommunications and the development of interactive television, the consumer is beginning to have access to a series of services hitherto unimagina-
september · december 2006 · esic market
06 615
(8) This method of
buying media in direct
markets is known as “
Per order” (PO) or
“Per-Inquiry” (PI)
(Daugard, 1996; Eicoff,
1995). Some stations do
not accept PI since,
although the method
guarantees a profit to the
direct market, the
medium may lose by
receiving less money
than if advertising had
been paid for. In these
cases the PI method
gives way to the “cash
library” where the station,
before the direct market,
benefits from the income,
or the “guarantee
purchase” method, where
the direct market buys
advertising space and the
station guarantees a
minimum number of
orders (Eicoff, 1995).
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development of a sector with a bright future: teleshopping
ble, including teleshopping. The development of interactivity will help the
television to change from being a passive instrument to offering the televiewer the chance to participate in the content and therefore adopt a relatively active attitude to the television screen.
Internet through television is an obvious example of the progress in
this field and without doubt is one of the most interesting options for stimulating the use of this form of shopping. In less than 10 years time it is
expected that the television will exceed the PC and most shopping transactions will take place through it, with a fully developed interactive television in both Europe and the United States (Barry, 2000; Cantwell, 2000;
Card et al, 2000; Caswell, 2000; Lee and Lee, 1995; Strategis, 2000) By
late 2000, interactive television was already present in almost 15 million
households worldwide and for 2006, this figure is expected to reach over
240 million households.
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