INDIAN TELESHOPPING MARKET

Presented By:NavdeepNehaVivekAtulNaresh

Basic Concept

“You should be offering what is not available in retail market.”

Miraculous Products

Miraculous products - weight reducing machines, disease curing teas, skin care products, etc

Miraculous results - reduce weight & get into shape without exercising or dieting.

BACKROUND NOTE

Teleshopping is an another name for Direct Response Television Shopping (DRTV).Other being catalog, letters, brochures, etc.

Teleshopping networks became operational in 1990s in the country.

Two types of infomercials:-A. Some featured celebrities using products

and benefiting from its scheduled on TV.B. In studio productions with a live audience.

In countries like US and Australia teleshopping had dedicated 24 hrs home shopping channels .its market in US valued around $2 billion in year 2000.

However it was not successful in other parts of the world due to low penetration, lack of innovation offerings, poor promotion & advertising techniques and lack of awareness among consumers.

By 2001 its total business in world amounted to over $5 billion.

Major Teleshopping Networks COUNTRY Major teleshopping networks in

various countries

US Home shopping network ,QVC, Telebrands ,TSN

Japan Shop Channel

Europe TV-SHOP

Australia TVSN

China China shopping network

INDIA Telebrands(India),Asian Sky Shop

Major players in India

Types Of products Offered

(1) Utility products- Majority of sale Such as: fitness devices, healthcare /auto care products, household appliances and electrical devices.

(2) Value Expressive products-Low sale productsSuch as: jewellery, apparels and home decor.

INDIAN SCENARIO

During early 1990s Indian laws prohibited customers to import products, without acquiring prior permission from the regulating authorities.

During the mid-1990s,Telebrands India ,a 100% subsidiary of Telebrand Corp, pioneered the concept of teleshopping in India.

In mid-1995, TSN (another major US-based teleshopping network) and Asian Sky Shop(ASK) which was founded in 1984, headquartered in Mumbai, owned by the media giant-zee, also entered the market. The other major players in the Indian Teleshopping market were TVC, TSNM and Star Warnaco.

All these networks adopted the following modus operandi :

Buying time slots on popular channels that had high penetration and enjoyed good viewership among the target customers.

Providing a special product code for every product and displaying it along with its price.

Setting up call centers in various cities, on the basis of the scale of operations and the extent of penetration expected.

Providing viewers with telephone numbers of these call centers and asking them to call their nearest call centers for further queries.

Rise in Indian Teleshopping Market

Teleshopping companies targeted segment premium-end TV viewers, with high purchasing power which were mainly nuclear families pursuing career.

Offered value for money products such as electronic goods, fitness devices, home appliances and toys.

India-based networks such as ASK also offered products made in India apart from their imported range.

Local player entered the teleshopping market through local cable channels

Teleshopping market players started offering customized products such as Jewellery with birth stones which became popular.

Q 1. Explain the concept of teleshopping and its working mechanism, benefits and the factors that have contributed to its success. Discuss the worldwide trends in the teleshopping business and the factors that have contributed to its success in the US. Also, describe the circumstances that led to the entry of teleshopping networks in India.

Concept of Teleshopping

Principle :- impulse buyingInfomercials featured miraculous productsAn attempt to build trust

Factors contributing to its success

High purchasing powerNuclear familiesAttractive offers – innovation and utility,

both

Continued…

Featuring well known personalitiesFranchisee base strongOffering customized products (jewellery with

birth stone)

Circumstances which led to the entry of Teleshopping

During the early 1990s, Indian laws prohibited customers to import products without prior permission of regulating authorities.

These laws also restricted the repatriation of money, without prior permission of RBI.

Q 2. Discuss the strategies followed by the major teleshopping networks in India with specific reference to each element of the marketing mix. Do you think the allegations against products claiming to offer ‘miraculous benefits’ are justified?

Strategies followed -

Advertisement strategyMoney Return offersLowering of pricesDubbed version of infomercials featuring

celebrities.Strong sourcing channel with the help of

agents.Free accessories and Early Bird prizes.

Yes, the allegations against products claiming miraculous results are justified as

Analysts criticized the teleshopping networks for trying to deceive the viewers into buying products with the belief that those people had actually used them. These people were paid to do the job.

No product could meet the expectationsProducts like religious jewellery, health and

personal care eg. Rashi ratan, sauna belt,  products that promised to make people give-up smoking and improve body posture but were not successful.

Q 3. Critically examine the problems faced by teleshopping networks in India. Do you think the market has a potential to grow in the future in the light of the above problems? According to you, what measures should the teleshopping networks in India adopt to address these problems and grow in future?

Problems faced by Teleshopping networks

Imitation products Higher pricesDifference in culture and languageLimited reach of productsCriticism of infomercials

FUTURE PROSPECTS

Increasing Base of convenience seeking people and middle class population.

Improvement in the standard of living of people makes them to try innovative products.

Offering online shopping services through special retail outlets.

Earlier male –female shopper ratio was 90:10, now it is 60:40

Measures to be taken

Opening of retail outlets in major citiesKeep in mind what customer wantsIntroducing innovative productsOnline shoppingEffective payment systemGift offers and discountsAir time (repetitive presentation of product

during peak and slack hours on TV)

Present scenario

AAA TELESHOPPING PVT LTD has emerged as pioneer in the teleshopping industry. Came in 2005

Products – astrology products, spiritual items and health related products

Teleone : provides multiple range of products at affordable prices. It also provides services like live chat for product enquiry, product videos, business offers, free consultancy on gemstones and horoscopes.