Eastern Home TV network foresees jump in revenues

Eastern Home Shopping Network (東森得易購), the nation's largest TV shopping service provider, expects revenues to reach NT$46 billion (US$1.5 billion) this year as the company moves into its sixth year of operation, officials said yesterday.

The target represents a 64 percent jump from last year's revenues of NT$28 billion, with the company banking on expanding its line-up of own-brand products and enhancing quality control, the officials said.

The network, which operates five channels, has 2.5 million members nationwide, making it the second largest retail channel after credit card issuers, company president Jennifer Sung (宋湘嵐) said at a press gathering yesterday.

"Further expanding our customer base remains one of our priorities this year as ... [this] will help boost efficiency and lower costs," she added.

The company enjoys a gross margin of around 30 percent.

Sung said the company plans to create 100 different brand-name products -- ranging from travel, jewelry, clothes and cosmetics to bedding, up from the current 10 items to boost profitability and increase member loyalty.

She estimated that own-brand products will contribute NT$2 billion in sales this year, or 5 percent of total revenue.

With the goal of making a name as a successful virtual department store, Sung said the company does not plan to set up real shops, but will expand through contracts with several retailers, which will sell some of its products.

Randy Lee (李傳偉), the company's vice president, said enhancing quality control to reduce the rate of returned purchases, which averages 15 percent, will help the company to slash costs and boost efficiency.

In addition, the unique convenience offered by TV shopping will allow "shopless" retailers to replace supermarkets or department stores one day, Lee said.

Television commerce, better known as T-commerce, generated business worth over NT$30 billion in Taiwan last year, an amount exceeding the total yielded by all cable TV channels in the nation in the same year, former director-general of the Government Information Office Lin Chia-lung (林佳龍) said earlier this month.

The emerging marketing system has been dubbed a new cash-cow industry, especially after the nation's two major financial holding companies also joined the segment this year.

Smaller rival Fubon Multimedia Technology Co (富邦媒體科技), operating under Fubon Financial Holding Co (富邦金控), is mulling setting up a second TV shopping channel in the latter half of the year, said Jean Chen (陳景怡), spokeswoman for Fubon Multimedia Technology.

But its first task is to break even before developing own-brand products and seeking another new channel, she added.