Start Today claims 10 million users, but closes outlet site

Dec 15

Start Today continues to close experiments which have failed to take off as hoped while prgressing with the upgrade of its core business. Above all it is focused on beating Amazon and other competitors in customer service, now extending free same day shipping to Kansai, a service which has helped boost membership in recent months.

Zozotown operator Start Today closed its outlet site, Zozo Outlet last month just three years after opening. Start Today is in the process of revamping its main Zozo mall and will add a small outlet section to this instead. The news comes in the same month that NTT Docomo’s dfashion store announced the opening of Outlet Peak, an online outlet mall owned by Docomo’s Magaseek that claims to be the largest in the world, offering 23,000 SKUs across 350 brands.

At the same time, Zozotown is extending its same day free shipping service to the Kansai area, having started same day, free shipping around Kanto in October. From late last month, customers in parts of Osaka, Kyoto, Kobe, Nara, Wakayama and Shiga were able to take advantage of the offer. As of this month, 16% of Kansai residents and 35% of Kanto residents are within the service’s coverage. As important, more than 50% of registered users of Zozotown now come within its same day delivery service area, although by same day service Start Today means delivery within 24 hours. In future, Start Today plans to link up with its network of fashion store partners to offer same day free shipping across the country.

Thanks in part to the new service, Start Today says it has now reached 10 million users of both Wear and Zozotown. Monthly active users reached 2 million. Wear app downloads reached 3.5 million in Japan and 500,000 overseas – the Wear app features data on more than 2,200 brands. It is not clear how many users of both services are in fact the same people.

As well as Zozotown and Wear, Start Today also operates a CtoC market place called Zozo Market and plans to expand CtoC operations over the next two years, forecasting a long-term user base of 30 million users.

Meanwhile sales in 1H2014 rose just 0.9% to ¥17.6 billion although operating profit rose 11.1% to ¥6 billion. Transaction values were up 13% to ¥56 billion, but less than forecast due to a lack of growth in paying customers and a slight drop in annual purchase values per customer – average prices per item sold were down 4.7%. Total customer numbers rose 720,000 to 3.5 million. For the full year it forecasts sales of ¥41.7 billion and operating profit of ¥13.7 billion.

Amazon signs deal with Yamato for same day pick up

Amazon has closed a deal with transporter Yamato to allow customers to collect purchases on the same day as the order. The deal exploits Yamato’s 3,000 sales offices that have the added advantage of being open long hours 365 days a year. Amazon customers will be able to opt for the Yamato service, and pop along to their Yamato office the same day – customers will receive a confirmation that the purchase has arrived. Amazon will charge ¥514 for the same day service, but members of Amazon Prime will be able to use it for free. Same day delivery is fast becoming mainstream in e-commerce; Amazon already offers same day delivery in larger conurbations, and Seven & I is working to use the Seven Eleven chain to offer a similar service.

Get a concise monthly update on Japanese Consumer Markets – and a FREE copy of our monthly report.