When QVC's parent company announced last month that it would acquire online retailer Zulily for $2.4 billion, the obvious implication was that Zulily—which targets a younger shopper than QVC—could help the storied brand broaden its customer base.
But there's another, less-talked-about synergy that Zulily stands to gain from its predecessor: how to better attract repeat buyers.
After Zulily's second-quarter earnings call last month, management admitted that over the past two years it became too focused on quickly growing its customer base. As a result, it ended up recruiting consumers who had a lower-than-expected retention rate, and a lesser lifetime value.
Although QVC CEO Mike George said Zulily is already making strides in learning how to attract a more loyal customer, it's something his company, which generates 90 percent of its sales from repeat customers, can help accelerate.
"What I think we've learned over the years is, how do you earn that new customer who's going to stick with you, [and] who's not just there to buy the item on sale," George said.