The Electronic Retailing Association

New Member Company Interview with Klaus Skripalle, CEO, CHANNEL21

ERA Europe: Klaus Skripalle, we are delighted to welcome you and your company CHANNEL21 as a new member of ERA Europe in 2019. Please introduce yourself to our members.

KS: The dynamic, creativity and especially the direct response we get for our ideas in the TV business are my life and love. As a home shopping television CEO, I’m driven by the chance to immediately measure and scale the business. Right from the moment we offer something, we get a response if product, price and presentation are able to meet the expectations of our viewers. Speed and the courage to try new marketing concepts are big strengths of our company.

Klaus Skripalle, CEO, CHANNEL21

Klaus Skripalle became CEO of CHANNEL21, Germany’s third largest home shopping TV channel, in 2011. He manages more than 200 employees in the company headquarters in Hannover and also manages the subsidiaries in Leipzig, Berlin, Istanbul and Izmir.  He began working with CHANNEL21 during an IT consulting project in 2011: the co-operation of private investors and The Bakery, his company at the time, soon delivered results and the companies have since been integrated.

Following his studies, Klaus Skripalle began his career with a short stay at Saint Gobain, after which he founded his first company ‘product + concept’ which was one of the leading internet agencies during the dotcom boom offering full service for customers like Fujitsu Siemens Computers, Acer Europe, Quelle, British Petroleum, Aral, AOL and T-Systems. In 2008 he founded The Bakery, creating and managing transaction platforms for business process management. Today The Bakery is part of CHANNEL21. Klaus Skripalle was also an evangelist for Intershop AG.

CHANNEL21 Logo

Contact CHANNEL21:

Denise Goldberg, Marketing / PR

CHANNEL21 GmbH
Großer Kolonnenweg 18 d
30163 Hannover
Tel: 0511 / 8998 - 101
Fax: 0511 / 8998 - 109
E-Mail: presse@channel21.de
Internet: www.channel21.de

ERA Europe: Why did you decide to become a member of ERA Europe.

KS: Networking and exchanging with international industry representatives are very important for us. In the past 3 years we put CHANNEL21 on stable tracks nationally – which gives us space to try our ideas for international growth. We started with a partner for a pilot project in Russia and we are looking for additional cooperation partners abroad because we are convinced that synergies resulting from combining individual strengths lead to more numerous and more cost-efficient results.

ERA Europe: Please give a short description of CHANNEL21 including a short history of the company

KS: Founded in 2001 as ‘RTL Shop’, the channel at first was a small branch of the major German TV station RTL. The parent channel and its programmes could be used to get coverage quickly, but there was hardly any experience with commerce and products which is why RTL sold the channel in 2008. After various investments, CHANNEL21 GmbH is a privately owned business since 2010.

Our technical coverage enables more than 95% of all German households with a TV to receive us. We also supply customers in Austria and Luxemburg.

ERA Europe: CHANNEL21 uses the 'Media for Revenue' model. Please tell us more about this business model.

KS: ‘Media for Revenue’, in short M4R, is a fair revenue share model which is based on the rule that all stakeholders contribute their individual skills and share the financial risk. An ‘open book philosophy’, with both partners giving insight into their costs, is fundamental for that. All costs are subtracted after a format is done and the remaining revenue/loss is equally shared. This model has one essential benefit for partners: they directly participate in the end user margin and can ‘test’ new products for the market.

ERA Europe: How do you decide which formats/presenters/brands/products to sell airtime to?

KS: CHANNEL21 is a company driven by numbers and KPIs. Our decisions are based on data analysis which are expanded daily and can be configured according to every kind of need using our own systems. We create our own software tailored to home shopping thanks to more than 15 developers. Every week we get together for a ‘round table’ to decide about new brands, subjects and marketing strategies.

CHANNEL21 is a full range provider offering thousands of products in the product groups cosmetics, jewellery, fashion, health, hardware and home.

ERA Europe: What about CHANNEL21's product portfolio: which are your strongest/fastest growing brands and product categories?

KS: Our product portfolio ranges from electronic scooters to food supplements. As a full range provider, we offer thousands of products in the product groups cosmetics, jewellery, fashion, health, hardware and home. We see a strong trend in conscious living within our audience and responded to that by strengthening our product range in terms of health and wellbeing during the past business year. We see lots of potential there and are developing our own brands with in-house products. This  investment is being honoured by our customers and is resulting in rising rates in product subscriptions.

ERA Europe: What was the most successful brand or product ever at CHANNEL21? Is this brand or product still in the product portfolio?

KS: There are some classics that accompany us for quite a while: the ‘Aqua-Laser’ was the first top seller – a steam cleaner which was sold in the millions. Right after that we had a hot air fryer and the ‘Venenwalker’ - a vein stimulation device by our partner DS Products. And in the cosmetics section we have a bestseller by Ricarda M.: the ‘24h-Crème’ has sold more than 5 million times already.

ERA Europe: What was the first teleshopping product that you bought for yourself?

KS: That was indeed a food supplement: ‘Contura Verde Pro Taille’

The modern and stylish CHANNEL21 studio

ERA Europe: How was business in 2018? What were the opportunities and what were the challenges for CHANNEL21?

KS: 2018 was a good year for CHANNEL21. Compared to 2017, revenue grew by 8% and surpassed the average market growth of home shopping channels in Germany of 5% (according to a forecast by Statista/ Goldmedia). Our online shop actually grew by 21% compared to the previous year. We lowered our return ratio by 2% versus 2017 and increased our gross proceeding by 12%, thanks to a strict business mix optimization and a new concept for a proper fit.

ERA Europe: What can your customers look forward to in 2019 - what is your growth strategy?

KS: Our customers can look forward to an even more diverse programme with significantly more product premieres in 2019. We will consequently add new items to the health sector. Another highlight: We will come of age and celebrate our 18th birthday during a big event spanning several days. This is the opportunity to redesign the channel – our customers will like it.

Our business model requires new production methods all the time as for example the ‘Offer of the Day’ which is the main revenue engine for each day. In this sector we will also gain more dynamic and start something new in 2019. Another idea is to extend the live programme.

As another cornerstone for growth and our future orientation, we will expand live TV programmes with original formats for the online sector which we already implemented in 2018. The main focus will be on a direct and personal live assistance and more individual channels for jewellery, beauty, health, fashion and hardgoods.

ERA Europe: Who is your target customer and how are you targeting new customers?

KS: Over 80% of our audience consists of ladies 50 years or older. We have loyal customers: Our returning viewers are responsible for 60% of our total turnover. New customers are generated thanks to programme windows on other channels, media cooperations and via PAYBACK, our customer loyalty programme.

CHANNEL21's White Walk where they create ‘White Walk’ moving images so customers can for example see how a blouse fits or how materials move

ERA Europe: Would you describe CHANNEL21 as a multi-channel retailer? If so, how are you taking advantage of the increasing digitalisation in the market?

KS: Definitively. Right now, TV is our main channel with over 70% but we see a clear transformational shift to the internet.

In 2013, we were the first German teleshopping channel to start with a 24h live stream on YouTube. The online share of CHANNEL21 is constantly growing but this kind of business is much faster and has other requirements. Information must be delivered on the spot, purchase decisions are more instant. For many years, our online presence is more than just a copy of the offer on TV and develops independently from its TV roots. We are leading in ‘White Walk’ moving images: In the long run simple product photography will be replaced by moving images – so our customers can for example see immediately how a blouse fits or how materials are moving. In 2018 we also created an online live consulting: with experts such as our health experts, we are producing live assistance formats and other programmes inside a virtual greenwall studio. Customers can directly ask our experts. These exclusive consultation hours are part of our content marketing. In future, we will produce genuine sales programmes for our e-channel in our virtual studio. Meanwhile we will still cater to the needs of customers who don’t yet prefer online, by providing programme information in TV magazines and others.

White Walk https://www.channel21.de/marken/sarah-kern/fashion/drapierte-bluse-107951.html

Live consulting - https://www.channel21.de/live-beratung

Live stream - https://www.channel21.de/live

CHANNEL21 employs more than 200 people in their company headquarters in Hannover, Germany.

ERA Europe: How relevant is social commerce for CHANNEL21 and how are you approaching this channel?

KS: Social media is very important for us. The main challenge is to reach customers that are 55 years or older and not as active in social media channels yet. These visitors need targeted content that meets their needs and leads them to the online shop. We are evolving from a service platform on Facebook to a distribution platform over time.

ERA Europe: What do you see as the growth potential for Home Shopping in Germany overall and in particular how much potential do you see for the classic Teleshopping TV focused business model?

KS: Our audience with an age of 55 and older is the only one which will grow in Germany in the coming 25 years. This audience also has 75% of the available capital. It wouldn’t be clever if we wouldn’t any longer care for that audience and offer our best recommendations.

ERA Europe: Do you have a vision for the future of the industry?

KS: The challenge in the coming years will be to provide the core competency of home shopping, which is ‘consulting’ in a bespoke way: customers will have the chance to follow a more active path inside our programme by using multi-channel interaction e.g. via separate TV and online channels. We are also planning very complex solutions for custom online sales consulting as in live TV using connected TVs (bi-directional).

ERA Europe: Thank you for taking the time to give this interview.

KS: All the best to all of the ERA Europe members …. see you in Budapest and another beautiful day!

About CHANNEL21

CHANNEL21 Logo

CHANNEL21 sells and distributes its broad range of products ranging from fashion, beauty, health and jewellery to household appliances and consumer electronics via specifically designed and produced TV-shows as well as the internet. Founded in 2001, CHANNEL21 is accessible nationwide in Germany by 95% of all households today and can be received via satellite, cable and DVB-T. Almost 6 million customers have already bought a product from the attractive and continuously expanding range. The group achieved a turnover of > EUR 100 million in 2017.