Teleshopping

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PRESENTATION ON
INDIAN TELE-SHOPPING MARKET
By Gurpreet Kaur Yachna Varshney
Ritika Chawla Sumit Gupta Priyanka
Verma Kalpana Sharma
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Offering Miraculous Products
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• Teleshopping networks provided consumers with
  miraculous products such as disease curing teas,
  wondrous kitchen, household equipments, weight
  reducing medicine etc.
• The products claimed to provide miraculous
  results. Such as reduce weight get into shape
  without exercising or dieting.
• The range of products included creams, potions,
  solutions, toys etc.

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Background Note
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• Consumer marketing can broadly be classified on
  the basis of levels between marketer and
  consumer(wholesaler, retailers, etc).
• Direct marketing is a zero-level channel wherein
  marketer interact with consumer on one to one
  basis.
• It motivates the consumer to take prompt action.
• Teleshopping is an another name for Direct
  Response Television Shopping(DRTV). Other being
  catalog, letters, brochures, etc.
• Teleshopping originated in the US in mid 1980s.
  In 1990s two type of infomercials were used. Some
  featured celebrities using products and
  benefiting from it scheduled between TV programs
  and at the end flashing a telephone number.

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• In other method there were in-studio production
  with live audience showing that It was not a mere
  commercial luring customer.
• In countries like US and Australia teleshopping
  had dedicated 24 hrs home shopping channels . Its
  market in US valued around 2 billion in yr 2000.
• However it was not successful in other parts of
  the world due to 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.

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Major Teleshopping Networks in Various Countries
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The Indian Scenario
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• In 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 Telebrands Corp., pioneered the
  concept of teleshopping in India
• In mid-1995, TSN (another major US-based
  teleshopping network) and Asian Sky Shop (ASK),
  owned by the media giant - Zee1 , also entered
  the market. The other major players in the Indian
  teleshopping market were TVC, TSNM and Star
  Warnaco.

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• 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. These time slots
  ranged from two minutes to 1 hour and comprised
  infomercials/product presentations, explaining
  the product's utility.
• 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 centre for further enquiries or to
  order the product.

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• EXAMPLE
• A consumer while buying a personal computer has a
  precption that if he buys an assembled computer
  it will be of higher quality as he will be
  choosing the best part provided by different
  companies.

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History of Teleshopping in India
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• Teleshopping marketing during late 1990s
• 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
• It used to import products from abroad to India
• India-based networks such as ASK also offered
  products made in India apart from their imported
  range.

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• Teleshopping marketing during early 2000
• Local player entered the teleshopping market
  through local cable channels
• Teleshopping market players started offering
  customized products such as Jewellery with birth
  stones..

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Types of Product Offered
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• The two types of products offered
• Utility products- Majority of sale
• Such as fitness devices, healthcare/auto
  care products, household appliances and
  electrical devices
• Value expressive products- Low sale products
• Such as jewellery, apparels and, home
  decor

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Persuasion Mode
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• Two types of persuasion mode adopted by
  teleshopping networks are-
• Functional Congruity
• Functional congruity aimed at attracting
  consumers by emphasizing the utilitarian aspect
  of the product
• Self Congruity
• Self-congruity aimed at attracting customers by
  matching the product user image with that of
  customer's self-image

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Teleshopping Traumas
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• Though teleshopping market was showing positive
  growth trend, its growth rate was much below the
  expectations of the players involved. Most of the
  teleshopping networks in the country were not
  making any profits.
• Example -
• TSN had closed its teleshopping activities in
  2002 and was concentrating only on online
  retailing (www.tsnshop.com).
• Tele-brands was the only one to sustain in the
  market with profits.

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Reasons for slow growth
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• Abundant supply of imitation products.
• Imitated products were cheaper comparatively
  therefore attracted customers
• Imitated products producers and sellers also
  offered the facility to personally touch and
  appraise the product to the customer or
  consumers.
• Higher product prices by teleshopping networks.
• Dubbed advertisements failed to have impact on
  prospective customers
• Criticism for some of its products which claimed
  to do seemingly impossible task. For example-
• products promising to reduce weight, remove
  unwanted hair, improve posture, improve hearing

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• The over-enthusiastic' and 'chirpy' foreign
  models that appeared in the dubbed infomercials
  were criticized on the grounds of being rather
  awkward mouthing dialogs in Hindi and other
  regional languages.
• Network only focused on metros and B-class
  cities neglecting towns and semi- rural areas.

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Future prospects
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• Despite all the above problems the teleshopping
  market was believed to hold a lot of potential in
  India based on the following reasons-
• Increasing base of convenience-seeking people and
  the middle-class population
• By mid-2002, most of the major networks such as
  Telebrands and ASK were deriving their revenues
  from three sources - websites (www.asianskyshop.co
  m and www.telebrandsindia.com respectively),
  teleshopping and retail outlets
• Global teleshopping networks proved to be a huge
  success, there seemed to be a strong possibility
  of their being successful in India, as well. .

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EXAMPLE RELAYED TO CONSUMER BEHAVIOR

• A consumer whenever decide to buy a house he or
  she prefer that house which is constructed
  according to the VASTU and they also prefer that
  house where sunlight enters in each room because
  it helps in preventing diseases in the house

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SWOT ANALYSIS
OF TELESHOPPING BUSINESS IN INDIA
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STRENGTHS

• It can be done conveniently- The product can be
  watched on television and ordered on phone.
• Focus on innovative and value for money
  products. Such products are not easily available
  in the market such as disease curing teas,
  wondrous kitchen and household equipments,
  innovative fitness devices and toys.
• A strong distribution network- The distributors
  are across the major cities and provide their
  telephone numbers for further enquiry which
  facilitates the buying process.
• Credit cards are also accepted to respond to
  their offers.

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WEAKNESSES

• Higher prices- Products were prized between
  Rs.1000-5000. Customers were unwilling to pay
  this amount for lifestyle products.

• Dubbed infomercials hampers the prospects
  of teleshopping market as cultures and languages
  vary.

• The distribution networks focus mainly on
  metros and B class cities.

• Teleshopping in India focus mainly on
  educated and premium end customers.

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OPPORTUNITIES

• Changes in life style and a general improvement
  standard of living can help teleshopping pick up
  momentum.
• Opportunities exist for teleshopping in the
  customer base of convenience-seeking people and
  the middle class population as they are more
  towards trying out innovative products and
  concepts.
• To boost the growth they can offer
  online-shopping services through retail websites.

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THREATS

• The Analysts- They question the reliability of
  the product and its effectiveness. This could
  lead to negative impact on consumer behavior
  about the products offered.
• Abundant supply of imitated , cheaper versions of
  these products by local entrepreneurs.
• Emergence of interactive home shopping. The
  retailers and consumers use interactive
  electronic systems to buy products online.
• Lack of online purchase awareness among the
  consumers and the low rate of credit card
  penetration in India can hamper growth of
  teleshopping market in India.

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• Trusted shopkeepers of the customers to buy
  expressive products like jewellery , apparels
  and home décor.
• The increasing competition among the various
  teleshopping firms in India.

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ATTITUDE OF PEOPLE TOWARDS COLD DRINKS

• Earlier the need was felt in summers only but as
  people became habitual and their attitude turned
  more favorable cold drinks are now consumed in
  winters also.
• Children likes cold drinks as life style has
  changed and fast food culture has grown rapidly.
• Youth tries to associate themselves with various
  brands like Mountain Dew , Thumps UP and Pepsi
  and they prefer these brands.
• Earlier, women and girls were attracted towards
  brands like Mirinda and Fanta . But now they are
  attracted to brands like Pepsi, Coca-cola and
  Thumps Up to show that they are strong and
  youthful.

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• Health conscious people does not favor cold
  drinks . They prefer fresh fruit juices and
  drinks.
• Moreover, once the attitude of people
  towards cold drinks once turned negative when it
  was found that they contained pesticides. They
  stopped consuming cold drinks later on when
  assured by the cold drink manufacturers , the
  attitude of people again turned positive.

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CONCEPT AND WORKING OF TELESHOPPING
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• It is the infomercials that we usually see on the
  television.
• It is another name for Direct Response Television
  (DRTV) shopping .
• It is one of the direct response marketing
  techniques which includes catalog, direct mail
  retailing and interactive/online home shopping.
• These infomercials featured products that claimed
  to provide miraculous results.

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BENEFITS AND FACTORS THAT CONTRIBUTED TO ITS
SUCCESS
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• People were paid to these commercials and they
  only tell there best features.
• In countries like US and Australia, teleshopping
  networks had dedicated 24 hour home shopping
  channels that offered extensive information
  regarding their product details and prices.
• It was not successful in other parts of the world
  because of low penetration of television, lack of
  innovative offerings, poor promotion and
  advertisement techniques, lack of awareness among
  the customers.

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CIRCUMSTANCES THAT LED TO ENTRY OF TELESHOPPING
NETWORKS IN INDIA
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• During the early 1990s, Indian laws prohibited
  customers to import products, without acquiring
  prior permission from the regulating authorities.
  These laws also restricted the repatriation of
  money, without the prior permission of the
  countrys central bank, RBI. This was a major
  reason for the evolution of teleshopping in India
  unlike US, where teleshopping evolved due to the
  changing societal norms.

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• EXAMPLE
• In case of buying a luxury car, the consumer
  behavior may be based on following aspects
• Status symbol
• Family and friends
• After sale service
• Brand
• Comfort

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MARKETING MIX
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• The networks decided to target the premium-end
  viewers, with high purchasing power.
• Focus was more on offering innovative and value
  for money products, which were not available in
  the market otherwise.
• A select range of imported products were offered
  that mainly included electronic goods, fitness
  devices, home appliances and toys.

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• The networks sourced their products with help of
  their agents, both in India and abroad.
• In some instances, the manufacturers of the
  products approached the networks directly for
  marketing and distribution of their products.
• The products offered were divided into two
  categories__UTILITY PRODUCTS and VALUE-EXPRESSIVE
  PRODUCTS.

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• Two types of persuasion modes to induce viewers
  to buy their products__FUNCTIONAL CONGRUITY and
  SELF CONGRUITY.
• The products were advertised through infomercials
  which were aired in 1-2 minute time capsules
  between scheduled programs or in 30-minute time
  capsules.

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• EXAMPLE
• MOST OF THE TIME IT HAPPENS WITH ALL
  OF US THAT WHEN EVER WE PLAN TO SHOP
  SOMETHING WE PLAN SOMETHING ELSE AND COME
  WITH SOMETHING ELSE. THIS REPRESENTS THE
  VARIATION IN THE BEHAVIOR OF THE CONSUMER,
  SO WHILE TARGETING IT IS NECESSARY TO KEEP IN
  MIND THAT WHAT EXACTLY THE CONSUMER WANTS.

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PROBLEMS FACED BY TELESHOPPING NETWORKS IN INDIA
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• TELESHOPPING Market show positive growth trend
  but its growth much
• below the expectation. Most the teleshopping
  network were not making any profits.
• The reason for the slow growth of teleshopping
  market in India are-
• IMITATION PRODUCT
• HIGHER PRICES
• DIFFERENCE IN CULTURE AND LANGUAGE
• LIMITED REACH OF PRODUCT
• INTERACTIVE HOME SHOPPING

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• The measures taken by teleshopping to address
  these problem are-
• Introducing innovative product and concept
• Online shopping
• Opening Retail outlets in major cities

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PERCEPTION

• In todays world people dont have good perception
• about the local duudh wala suppliers. Their
  quality of
• milk is very poor, unhygeniec and not safe for
  children
• and family.so people dont find it safe for
  consumption.
• But as compare to local duudhwalas, people prefer
  the
• MOTHER DAIRY milk. Their quality is far better
  than
• local duudhwalas. They are safe for consumption.
  They
• Also come in three variety i.e. tonned, full
  cream , half
• cream.

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THANK YOU