Search
Close this search box.

CASE STUDY How Ideal Shopping Direct used a digitally-centric approach to go from loss to profit in a year

Ideal Shopping Direct: winning with digital

Ideal Shopping Direct (ISD), a leading UK multi-channel home shopping retailer and owner of the Create and Craft and Ideal World TV channel has achieved a significant turnaround of the company in the past 12 months; £6.5m profit, 30% ahead of the £5m it predicted earlier in the year.

The company lost £32m the previous year, its underlying profits before taxation improved by £10.6m and gross profit was 1% higher year on year, while its base grew by 20,000 customers on the Create and Craft brand alone.

The news marks a significant turnaround for the company, which sells into over 31m homes in the UK via shopping channels on Sky, Freeview, Freesat, Virgin and late-night ITV plus 35m homes in America and on its own websites.

Ideal Shopping Direct and the newly appointed management team, CEO Jamie Martin and COO Martin Purcell attribute this turnaround to increased TV audiences, sales and a resilience in an increasingly challenging retail environment brought on by Brexit and lockdown.

Despite the UK retail downturn, ISD were already well on the way with a digital transformation; diversifying from their roots selling items through traditional scheduled TV channels to successfully shifting the channel’s product offering online.  The business remains bullish about its prospects for dramatically increased growth as it looks ahead to 2020/21.

Jamie Martin explains: “Covid-19 forced businesses of all sizes to shift gears. Luckily we were already well on our way with a digitally-centric approach ahead of Covid-19 crisis hitting and the last 12 months has been about us reaping the benefits of this strategy. By laying the foundations to thrive in an increasingly on-demand, online world, our business has not only successfully navigated retail’s choppy waters but we have been able to invest in new facilities, bring on bigger brands and negotiating pivotal partnerships.”

A further key contributor to Ideal Shopping Direct’s growth has been the successful negotiation with ITV. Last Summer, Ideal World teamed up with the UK’s largest TV channel to have its own channels take over ITV’s network after midnight daily, helping to build brand awareness and drive both new suppliers and customers.  

“When the new management arrived, we didn’t even have high definition TV facilities” notes Martin. “We had an entire studio producing standard definition programming, which wasn’t good enough for 2020. We made a multi-million pound investment in high definition cameras, production equipment and studio renovations, as well as new brand identities for Ideal World and the partnership with ITV and it has paid off.”

“You only have to look at the growth of likes of Netflix and Amazon TV to realise that TV broadcast to a schedule when the broadcaster says it will be on has a limited shelf life. We have to stand out in that world and that means amazing quality pictures pushed out to discerning viewers whenever they want it.”

Profits have also been driven in part by the business’ new management team reinvigorating and investing in Create and Craft amidst the recent explosion of craft, which now contributes £3.4bn to the UK economy. The company have focused on shifting the channel’s product offering and marketing strategy to help target the new younger demographic of consumers, almost a third of which are now under 35.

The latest developments at Create and Craft have involved launching an in house ‘innovation hub’ which designs new and exclusive products and working with some of the UK’s largest craft suppliers. Following an even bigger boost to the UK craft market since lockdown, the business has put its money where its mouth is and signed household name, Keith Lemon to front its marketing. 

Lemon will help tap into younger audiences by delivering engaging digital content exclusively across the Create and Craft YouTube and Instagram channels. 

“We’ve adapted our content and platforms to reach new audiences and in turn help future-proof our business” says Martin. “A year ago, people wouldn’t have expected a brand like ours to be partnering with Keith Lemon but when my mother in law said, “What are you doing employing that man?’ I knew we’d probably made the right choice!”

Ideal Shopping Direct has also engaged and surprised existing and potential customers by bringing on huge brands like Samsung, Huawei and Sony, at prices people do not expect. Martin says: “It’s all about being able to get the right prices on the right products, and we can do that because we sell our stock quickly. Samsung doesn’t mind us undercutting its own set prices on its phone range because we do it only for a couple of days, with limited numbers and then we stop.”

In the coming months, the business will continue to focus on digital to further reach younger audiences who do not watch traditional TV and continue to turn the business from TV-centric to engaging customers across platforms including websites Twitch, Facebook, Instagram and YouTube. Plans in the pipeline include an online ‘marketplace’ where third party sellers can sell a wide range of goods online, from fashion to technology.

 “We’re innovating but we’re also reacting to what’s out there,” says Martin. “Centuries ago people set up the first markets next to churches. The churches had huge steeples, so people were drawn to them and traders went and sold, person to person from wooden stalls where they would pitch their goods.

“The medium has changed and so have the markets but in real essence this is still our model – people selling value to people in the environment the audience has chosen. We’re active across the platforms and that’s how we’ve turned the company around – and I can see no sign of our evolution ever having to stop.”

Read More

Register for Newsletter

Group 4 Copy 3Created with Sketch.

Receive 3 newsletters per week

Group 3Created with Sketch.

Gain access to all Top500 research

Group 4Created with Sketch.

Personalise your experience on IR.net