Continuing a thoroughgoing turnover of top management at struggling TV and web retailer ShopNBC, e-commerce veteran Randy Ronning has taken over as chairman of the board, replacing John Buck.
Ronning was executive vice president and chief merchandising officer when he left competing home shopping retailer QVC Inc. in 2007 after a six-year stint, and before that spent 30 years at J.C. Penney Co. Inc., where he headed the catalog, distribution and Internet divisions. Ronning rejoins another QVC veteran, Keith Stewart, who joined ShopNBC in August 2008 as president and chief operating officer, following the firing of CEO Rene Aiu, who had been in the job only six months. Stewart was named CEO early this year around the same time as Ronning joined the ShopNBC board as a member.
Buck, who was interim CEO after the firing of Aiu, says the time is right for him to leave ShopNBC, No. 87 in the Internet Retailer Top 500 Guide. “The company is nearing completion of its cable and satellite renegotiations and, while doing so, has maintained its national footprint of 73 million homes while significantly lowering its distribution fees,” Buck says. “ShopNBC's seven-member Board has been reconstituted over the past 12 months with five new directors, who will be chaired by an extremely well-versed multi-channel retailing veteran in Randy Ronning.”
Ronning says his role will be to provide stability and make sure the management team is aligned behind CEO Stewart’s vision for ShopNBC, whose web sales dropped 28% last year. Stewart says he wants ShopNBC to be a higher-end retailer, but to bring down the average selling price, which has been over $200. He says the average selling price was $144 in the first quarter of this year, and he aims to reduce it further.
Moving to reduce expenses, ShopNBC will save $22-25 million as a result of renegotiated deals with cable and satellite TV system providers, following an 11% reduction in headcount early in the year. He says the average cost of a transaction, from order processing to returns handling, averaged $5 last year, and is now about $4. “But our competitors are at $2.75, so there’s a tremendous opportunity to reduce those operating expenses,” he says.
By fall, Stewart says, ShopNBC will be able to ship all of a customer’s purchases in a single day, whether through a phone call or a web order, in a single package, saving the customers shipping costs. He says a third of customers say they would buy more if shipping fees were lower.
Stewart says the aim is to double ShopNBC’s revenue every three to five years. The company’s sales in fiscal 2008 totaled $568 million. The company had been up for sale, but found no takers, and Stewart says there is no current effort to find a buyer for the publicly traded company, which is owned by Value Vision Media Inc.
QVC is No. 11 in the Internet Retailer Top 500 Guide and J.C. Penney No. 15.
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