Despite a shrinking TV home shopping market due to viewer attrition and the rise of e-commerce, the second-quarter operating profits of four major home shopping companies have all increased. Analysts attribute this growth to a focus on high-margin products such as fashion, beauty, and health supplements, as well as a strengthened strategy in mobile live commerce and private brands (PB).
According to industry reports, CJ OnStyle's second-quarter revenue rose 4.4% year-on-year to 402.8 billion won, with operating profit increasing by 21.2% to 26 billion won. Mobile live commerce (MLC) sales surged by 161.3%. CJ OnStyle is expanding its mobile commerce by combining premium products in fashion and living with short-form influencer content and fandom intellectual property (IP). Last year, MLC transactions also grew by 66%.
GS Shop reported second-quarter revenue of 268.2 billion won and operating profit of 26.7 billion won, marking increases of 0.9% and 6.0%, respectively. This marks three consecutive quarters of improved performance since the fourth quarter of last year. In the second quarter, GS Shop increased the number of exclusive products in fashion, beauty, and living by 46% compared to the previous year, with contributions from the fashion brand 'Core Authentic,' underwear 'UBGS,' and beauty PB 'VU.' The mobile application has also enhanced its sections for fashion, beauty, and food.
Hyundai Home Shopping's second-quarter revenue decreased by 1.3% to 270.7 billion won, but its operating profit rose by approximately 13% to 25.1 billion won. This improvement is attributed to a reduction in low-margin products and a focus on more profitable items in fashion, beauty, and food. Strong sales of high-margin broadcast products in food and fashion, along with reduced transmission fees, also contributed to the profit increase.
Lotte Home Shopping reported a 3.3% increase in second-quarter revenue to 238.6 billion won, with operating profit soaring by 62.7% to 19.9 billion won. The improvement in performance was driven by a portfolio focused on high-margin products such as health supplements and beauty items, along with cost efficiencies. Lotte Home Shopping plans to pursue qualitative growth centered on high-efficiency products and secure growth drivers through new business ventures.
The performance improvements of these home shopping companies contrast sharply with the overall market trend. According to the Korea TV Home Shopping Association, the total transaction volume of seven TV home shopping companies, including GS Shop, CJ OnStyle, Hyundai Home Shopping, Lotte Home Shopping, NS Home Shopping, Home & Shopping, and Public Home Shopping, was 18.5053 trillion won last year, a 5.1% decrease from the previous year. This marks the fourth consecutive year of decline since 2021. Broadcast revenue also fell by 0.9% to 2.6181 trillion won, the lowest level since 2012.
The aging customer base is also becoming more pronounced. The proportion of women in their 60s among all customers increased from 24.8% in 2024 to 29.9% last year, while the share of women aged 70 and older rose from 8.8% to 13.0%. In contrast, the proportion of women in their 40s and 50s decreased from 43.8% to 36.9%. Additionally, the burden of transmission fees remains significant. Last year, the seven TV home shopping companies paid a total of 1.9212 trillion won in transmission fees to pay-TV operators, accounting for 73.4% of their broadcast revenue.
An industry insider stated, "Home shopping companies are enhancing profitability through high-margin and PB products while expanding customer touchpoints through mobile and content commerce. Considering the decline in transaction volume, the aging customer base, and high transmission fee burdens, securing younger customers and reducing dependence on TV are key challenges."
* This article has been translated by AI.
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