Be aggressive to attract the masses

Retailers are facing a tough time on both sides of the Atlantic, but US infomercial pioneer Kevin Harrington reveals his strategies to sell products on the global stage.

Retailers are facing a tough time on both sides of the Atlantic, but US infomercial pioneer Kevin Harrington reveals his strategies to sell products on the global stage.

Retailers are facing a tough time, but infomercial pioneer Kevin Harrington believes that when the ‘going gets tough, the tough get going’. He’s using the strategy to launch his new marketing and retailing company TVGoods in Europe.

Harrington, who is an investor on the US TV series Shank Tank, the US version of the BBC’s Dragons’ Den, has returned to London with TVGoods 20 years after launching his former infomercial company Quantum International in Europe.

He reveals in a Q&A with GrowthBusiness his plans for the new venture, his criteria for choosing products to sell, and his strategy for selling globally.

Your company, TV Goods, launched in the US last year, and this week opened its European headquarters in London, could you detail its history and how it operates?

We are a product development company. We call ourselves a venture marketing company. People, inventors, entrepreneurs and product owners come to us to market and sell their products.

We will launch about 50 products this year out of the US and then, through our international offices in Toronto and London, we will distribute our most successful US products. Having just launched here, we don’t have UK products yet, so to start with we have launched in the UK with US products.

In the US, we sell a lot of products to home shopping networks QVC and Home Shopping Network (HSN). The same products we sell on the shopping channels in the US, we will sell on the shopping channels in the UK, as well as in Italy and Germany and all around the European marketplace.

Our first plan in London is to take the best selling products from the US and enter the European marketplace. At the same time, we will also be soliciting UK and European products, and bringing them back to the development pipeline for the rest of the world.

We are already taking products that we are developing here in England, back into the global marketplace.

What makes a good product global? What makes something appeal to the mass market?

I have a checklist that I look for. The first thing that I look for is whether it is mass market. Obviously, it can’t be too niche.

Secondly, I ask, is it a problem solver? When you think about an inventor, they approach things from the standpoint of how to solve a problem. So if it solves a problem that is a good thing. And then, I ask, is it unique enough? Does it solve a problem and is there nothing else in the marketplace that already solves that same problem? That is kind of an important thing.

Some people say, ‘oh, here’s this great item, and look at the problem it solves’, but there can be a dozen things already in the market that take care of the problem. That is not good.

The next thing that we look for is does the product have multi-functionality? Sometimes products that are singular in function are fine, but we always ask vendors and entrepreneurs, if it does one thing, can you easily add another function?

I also ask, does the product provide a transformation – I like to use the phrase, ‘magical transformation’? When someone comes to my office and shows me something, whether it is a kitchen gadget or beauty product, I want to know if it can transform something. Some of the best selling beauty products are like this. Take under-eye creams that make facial lines disappear within 60 seconds – that is a ‘magical’ transformation.

Taking all this in – products having to be unique, ‘magical’ transformational, multi-functionality – then we look for products that have to be credible. We don’t look for products that are gimmicks or too good to be true.

In the old days, companies launched products that made outrageous claims and promised big results, but there was no scientific back-up, data or documentation. We require documentation and send products to testing labs to verify claims. If you meet all of these criteria, or some of those, then I think that would be a very good product for us.

When you are selling your products across international markets, what is your strategy?

Generally, we launch in the US, and if it works there, then our first question is, is this going to work around the world? If we think so, we take the product to our Toronto office, which gives us a good feel for internationalism because there are English and French-speaking markets in Canada. If it works in Canada, that is a good sign, and then we bring it here.

London is really the first significant test outside the US, because Canada is so Americanised. If something works in the US, works in Canada and works in London, that is a strong indication the product will do well in Europe, and we immediately go for the rest of the European continent.

For the most part, if something works in the US and works in the UK, there’s a 90 per cent chance that it is going to work in the rest of Europe.

Do you have partnerships with major retailers?

In the early days with Quantum, we had our own operation here and we actually sold to the stores themselves. In the later years, we worked on the distributor model, where we would find local distributors to take our products, and we would do license deals with distributors in local markets. That is the kind of deal that has been done for the past 10 years.

With our own operations here, we have the flexibility to decide on the method of delivery, and we will do that on a case-by-case basis.

You’ve mentioned that the company is ‘embracing opportunities afforded by new technologies to adapt and grow’; can you explain some of these technologies?

The retail marketplace is very tough right now. A retailer has a store, rent and overheads, but we, as an electronic retailer, don’t.

We not only use television in marketing, but we use print, radio, internet media, and now we are getting into social media, including phone apps. We have recently developed a ‘click to buy’ app that is being launched in the US soon, and later in the UK. This is a new technology that will make it easier for people watching television to order the products.

Given the economic situation in the UK and across the continent, what do you see as happening in retail, are you seeing more people becoming tighter with their money, or are they continuing to buy?

In the US, we keep hearing the same thing. Retail is tough, sales are tough, but there will be an increase on last year in the market of about 2 to 3 per cent.

I am not totally up to speed on the situation in the UK and the rest of Europe, but this is my attitude. The money is out there. Yes, people may be a little bit tighter on where they are spending it, but that means you have to be more aggressive in how you go and capture the customers.

That’s why we feel electronic commerce is the wave of the future because we don’t have to have a retail store. I don’t have to have the overhead, and all the staff, and the people standing around 12 to 15 hours a day. We go after the customer with a multi-channel approach and in a fairly aggressive fashion.

Our sales are 45 per cent internet-based, whereas three years ago, for many companies that was 20 per cent. So any retailer that is not looking at a multi-channel approach is going to have some problems. That is why we say, when the going gets tough, the tough get going, that is what the retailers need to be doing now – they need to be thinking towards the future and electronic commerce is one of the waves of the future.

Todd Cardy

Todd Cardy

Todd was Editor of between 2010 and 2011 as well as being responsible for publishing our digital and printed magazines focusing on private equity and venture capital.

Related Topics

Early Stage Funding