O Shopping Channel eyes 2015 revenue of B1.5bn

O Shopping Channel eyes 2015 revenue of B1.5bn

O Shopping Channel, the TV home shopping venture between GMM Grammy Plc and South Korea's CJ O Shopping Co, expects 2015 revenue to grow by 50% to 1.5 billion baht thanks to increased acceptance among Thai consumers.

"Our home shopping channel in Thailand can break even within 26 months, the fastest among all overseas operations," said Sung Nak-Je, chief executive of CJ O Shopping Co.

Sales in 2014 are expected to reach 1 billion baht, double that of 2013, even though the economy has been weak and there was a 10-day suspension of all TV channels after the coup in May.

The channel now has 450,000 customers, mostly young people and housewives aged 25-50 and residing in Greater Bangkok. They have high purchasing power and spend a lot of time watching TV.

About 43% of them are repeat customers with average spending per ticket of 2,500 baht.

However, the customer base in Greater Bangkok is still 70% below the channel's expectations. As a result, it will do more marketing activities to boost sales in areas that still have high potential to grow.

O Shopping Channel's best-selling items are lingerie, IT gadgets and personal products. As the channel can simplify content and clearly present the products, it can easily draw buyers.

Moreover, CJ O Shopping's know-how such as product presentation and wholesale approach can help establish a strong presence for O Shopping Channel in Thailand.

Mr Sung said the TV home shopping business in Thailand still had tremendous growth potential and the market value is estimated to reach 22 billion baht by 2019 from the current 8 billion baht.

Such growth will be driven by higher purchasing power and clearer regulations by the National Broadcasting and Telecommunications Commission in the years ahead.

Product differentiation and attractive pricing strategy will continue to boost O Shopping Channel's sales revenue, particularly from products made by local small and medium-sized enterprises.

SME products account for about 60% of total sales, similar to the operation of CJ O Shopping in South Korea.

Additionally, the online channel is another tool to help generate more sales for O Shopping Channel as it can offer small-scale and low-priced products to attract a younger generation of customers.

The online venture is expected to contribute 3% of total sales in 2014 and will rise to 10% this year.

O Shopping Channel now has a 13% market share of the TV home shopping industry, which is led by TVD Channel.

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