Lohaco becoming major netsuper

Oct 07

Lohaco, Askul’s online shopping site aimed at the general consumer market, is fast becoming a significant competitor for the likes of Amazon and Seven & I. Backed by Askul’s considerable experience in non-store retail, Lohaco took a further step this summer by introducing a major update to its smartphone shopping app. The app has been heavily researched to target busy female shoppers, introducing a magazine style format as well as easy search and detailed purchase and browsing history.

Lohaco’s smartphone app has been updated to better target its core market, busy female consumers. The Lohaco site (lohaco.jp) concentrates on food and household products and is rapidly building awareness as the closest thing Japan has to an online supermarket run by a non-store retailer.

The Lohaco site is very different from Askul’s core business selling stationery to offices, but builds squarely on the company’s expertise in non-store distribution. Close ties with Yahoo Japan, and the recently launched logistics and back office services aimed at SMEs, also leverage these particular skills. While still relatively small, Lohaco increasingly looks like becoming a serious competitor to both Amazon Japan’s new netsuper in the online sphere (see below), and one that will go head to head with Seven & I’s Omni7 store.

The new app is designed to ease the shopping experience. Customers can search and order products as well as browse purchase histories. It allows customers to ‘like’ interesting products, but also records every single item the customer views. These can then be retrieved for later purchase or for comparison, and allows Askul to send out prompts and use the data for marketing. Customers can choose and purchase products with one tap.

New products are introduced on the front page and search functions have been improved to provide better suggestions – searching for ‘breakfast foods’ presents a range of products in a menu-like format for example. Similarly, individual product screens provide recommendations and usage tips – for example, why not enjoy the health benefits of adding an order of chia seeds to go with the Calbee muesli, and, of course, don’t forget to buy a Muji branded wooden spoon to eat it with.

The app also publishes lifestyle articles, all related to specific brands and their uses, emulating the kind of content consumers are used to seeing in Japan’s many lifestyle and branding magazines.

In total, the app provides access to around 200,000 SKUs in 14 top-level categories. Askul has begun a major print and TV ad campaign to create further awareness of Lohaco.


Amazon Japan launches netsuper and secondhand store

Amazon Japan has finally launched a full netsuper (online supermarket) service to supplement the huge range of other sub-categories available through the online store. The new service, called Amazon Pantry, launched in mid-September and aims to compete primarily on price with major netsuper operations such as those of the Coop, Aeon, Seven & I and Seiyu. At launch, Amazon Pantry was made available to Amazon Prime subscribers, offering 5,000 SKUs of drinks, packaged groceries and household items, but no fresh produce – a bit like an expanded convenience store.

As with other Amazon stores, the supermarket has no minimum order, and, depending on area, same day delivery is available on orders made early enough in the day. Unlike other Amazon services, Prime customers pay ¥290 for delivery by the box up to 12kg – again a system modelled on a typical (although somewhat large) shopping basket. Despite the delivery charge, Amazon is offering prices aimed to be lower than rivals – a 2L bottle of Suntory Minami Alps water sells for just ¥89 for example.

Yano Research estimated the netsuper market in 2014 at around ¥120 billion, although as with fashion estimates, this could be up to half of the actual figure given the high volume sold through Rakuten vendors alone.

Amazon also unveiled a new used store last month. At the start product categories include computing, electronics, books, media, home, toys, fashion, watches, sports and cars/motorbikes.


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