Isetan Osaka and Lucua plan unveiled – a test case for more small Isetan stores

JR West will unveil a new section to its Lucua SC at Osaka Station next Spring, taking over 30,000 sqm of sales space from Isetan-Mitsukoshi. The latter will no longer have a contiguous sales space of its own, forced instead to operate separate sales areas as small stores. Ironically, this may turn out to be great news for Isetan, helping trial its plans for a string of distinct small format chains. These will include accessories stores, and from next year even an Isetan Wedding chain.

Last month JR West unveiled its plans for the reallocation of space from the failed Isetan-Mitsukoshi Osaka store that is due to reopen next Spring. As previously reported, 30,000 sqm of the former 50,000 sqm department store will be turned over to Lucua, the SC run by JR West.

The Isetan-Mitsukoshi area will be rather awkward both in name and structure. It will be called Isetan+Shohin Ryoike (‘product realm’ in English) – admittedly the moniker looks slightly more elegant in Japanese. It will, however, not be needed in-store. Indicative of the changing nature of Isetan’s focus, rather than a department store, Isetan will essentially be operating small format stores within an enlarged Lucua shopping centre, spread across the B2, B1, 1, 2, 4, and 8th floors in distinct and separate concessions – the building itself will have a new name, Lucua 1100. Each zone will be dedicated to a particular category such as men’s fashions on the 8th floor, seasonal accessories on the street level, shoes accessories on B1, cosmetics on the 2nd, with the popular food hall on B2.

The good news is that the Isetan sections will be completely revamped and nothing like the store that went before. Much of the merchandising and store design will come from Isetan’s new Shinjuku-based small format store team that is responsible for the existing airport stores as well as the upcoming 1,000 sqm Isetan boutique in Midtown in Roppongi and the 3,000 sqm store due in Nagoya next Autumn. Isetan recently unveiled design specs for the 900 sqm Midtown store, to be called Isetan Salone, suggesting an art gallery style design to emphasise the high level of curation in product selection, a theme likely to be echoed at Lucua and other small format stores. Brands will include Maison Martin Margiela, Hyke, Marni, Viktor & Rolf, Dries Van Noten and other worthy designers, when the store opens in April.

The move in Osaka acknowledges both the failure of the department store in Osaka, but also the new focus on small format store retailing by Japan’s biggest department store group. The Lucua Isetan stores will be a useful test for Isetan’s plans to expand into chain retailing. This means not just the above-mentioned larger select shops, but also more men’s stores outside of airports, fashion select shops, and, most tantalisingly, an accessories-based select shop chain that is rumoured to be launching late next year.

In addition to Isetan stores, Lucua 1100 will house a range of specialty tenants to complement the casual fashion focus in the main Lucua next door. Tenants will include Flying Tiger, Forever 21, Estnation, Nano Universe Library, Old Navy, and Margaret Howell. The existing Lucua and Lucua 1100 will comprise 70,000 sqm of combined sales space, making it the dominant SC in the area, putting pressure back on to neighbour Grandfront Osaka and surrounding department stores and SCs.

Meanwhile Isetan-Mitsukoshi is busy with the latest plan in its diversification strategy. Next year it will launch a new division tasked with developing retail services for what it calls Life Events – the key events such as marriage that shape a person’s life. The move helps the department store broaden its offer to include a greater variety of services, exploiting the Isetan and Mitsukoshi brands better but without necessarily taking up too much sales space. It also helps make better use of the customer-bereft upper floors of its department stores, and provides a meaningful way of upgrading their drab appearance – there is even talk of converting some space into wedding halls, a neat solution for those top floors and even roof space.

A new Isetan branded bridal service will be launched next year offering a complete range of services and product, covering all aspects of weddings from engagement to honeymoon. At the start a new wedding service store will be opened within department stores, starting with Shinjuku but dedicated Isetan branded bridal stores are expected in SCs later. To build a complete offer, Isetan-Mitsukoshi is recruiting experts in wedding planning, catering and so on, as well as considering M&A of wedding service businesses which will then be rebranded and adjusted to fit with the Isetan brand. Similar Life Event spaces within department stores are planned for graduation, childbirth and rearing and even retirement.

Another plank in its plans for greater retail control is expansion of exclusive brands. Its latest initiative is a tie up with Samantha Thavasa on a new brand of bags and accessories. Called La Plume Samantha Thavasa, the brand launched with a sizeable corner within Isetan Shinjuku late October. The brand is positioned higher than Samantha Thavasa – prices are double the typical Thavasa ranges at ¥60,000-100,000 – with a focus on Japan-sourced materials, craftsmanship and timeless designs that are meant to appeal to both Japanese in their 40s and tourists. A second corner opened last month in Mitsukoshi Nihonbashi and the brand will also open in overseas stores such as Isetan Shanghai.

Isetan-Mitsukoshi opens store on NTT Docomo

Isetan-Mitsukoshi opened a store within NTT Docomo’s mobile store dShopping last month. The store sells gifts, for both formal gift occasions as well as Christmas and birthdays. 1,500 SKUs are on offer at the start. Customers can pay with a card or through their mobile phone bill. In a bid to satisfy loyal shoppers of both its brands, customers will be able to choose wrapping using either Mitsukoshi or Isetan branding. This is yet one more example of the firm’s efforts to diversify and exploit its brands across a variety of formats and merchandise categories.