November 2 2015

November 2015 Highlights

Highlights from JapanConsuming monthly report

News and Analysis on Japanese retailing and consumers

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FOCUS: Leading shopping centres upgrade their way to 3.9% jump in sales in 2014-15
The top 100 shopping centres continue to grow. After a great year in FY2013, with sales rising an average of 4.2%, the leading SCs overcame the downturn in spending in 1H2014 to finish with another 3.9% jump in FY2014. The top selling SCs fared much better than the sector as a whole, which was flat at 0.1%. The downturn in spending on non-essential high ticket items after the consumption tax increase was offset by major investment in upgrading, expanding and converting SCs, spurred on by increasingly intense competition in key cities. The level of investment reflects the optimism and confidence among the leading developers that proactive management can overcome weak domestic demand, and force nearby competitors out of business, all the while reaping the tourist dividend that is lifting all boats – at least those in the right locations.

Laox rises from bankruptcy to become tourist shopping leader
Laox, a name apparently derived from Latin, was born in Japan more than 50 years ago, but in 2001 the company went under. Since being rescued by its new Chinese parent, the chain has re-emerged as the single leading retailer targeting tourists, and a major source of sales for brands of cosmetics, fashion, jewellery, and of course gadgets. Laox is set to lead this market well into the future, so much so that department stores are queuing up to offer concession space.

Editorial: The future of shopping centres

Takashimaya launches shopping centre specialty chain
The small format chain ambitions of the major department stores are a great opportunity for overseas brands to reach new parts of the country and new customers. Isetan Salone was there first and is very much a high end select shop, but now Takashimaya has come up with its own chain, one designed specifically for the SC market and almost entirely dedicated to accessories, shoes and cosmetics.

Convenience stores aiming to be default for online delivery  
Japan’s network of 55,000 convenience stores, 80% of them run by just three companies, is an ideal delivery system for online sales. The growth in online retailing in general is a tremendous opportunity for domestic and overseas brands alike, with expanded market access and lower cost distribution options of particular interest to overseas firms. The new trend will only help boost interest in buying online, further fuelling growth and accelerating consumer acceptance.

Itokin and Onward under pressure from changing market
World shocked the apparel industry with its plan to cut 500 stores, and TSI Holdings continues to slash away at its brand portfolio. Other major apparel groups are also under serious pressure too. Itokin may well be forced to accept management by its main bank and Onward has failed to see any renewal after pulling out of several loss making businesses. The competition is hacking away at their middle market positioning.

Mobile ads help reach 15 million young women
Anyone claiming access to the important 24-34 year old women’s market in Japan is going to get attention. A new start up backed by @cosme and Itochu’s Excite Japan claims not only access to 15 million young women but also a sure fire way to get their attention: curated ads on their smartphones as they consume content.

Lumine plans direct franchises with international brands and retailers
Lumine just signed a franchise deal with an overseas pizza chain. Nothing particularly unusual about that, but what is radical is that it is a direct franchise, and Lumine has plans for more, not only in dining but also in apparel, accessories and home fashion. It is even looking at Lumine-managed select shops.

Seven & I continues major overhaul of GMS and department stores
Seven & I is determined to make its GMS and department store businesses more profitable. It has already invested in upgrading key department stores, while converting others to hybrid SC operations, and last month announced the closure of 20% of Ito-Yokado stores. Key to future profit will be the rapidly expanding range of brands sold across the group, such as the just launched Jean Paul Gaultier private brand and a new directly sourced shoes line, all of which are being integrated into its omnichannel heart, Omni7. Seven & I also continues to close failing stores, with the latest a Seibu store in Saitama.

Consumer loyalty in Japan: loyalty programmes add value
Epsilon’s latest study on brand loyalty in Japan reconfirms a high level of loyalty to certain brands in some sectors. Loyalty programmes are popular, with consumers more likely to be members of multiple schemes rather than none at all, but shoppers look for value in their loyalty points, with programmes such as T-Points or Ponta now more commonly used than those for individual brands. The results also suggest an opportunity for more loyalty marketing by luxury brands.

Rakuten losing in online fashion
Nikkei’s annual ‘Net Life’ survey for 2015 shows a downturn in spending online due to the overall expenditure cut backs over the past year. As Amazon has added new brands and sub-stores, more shoppers are moving away from domestic rival Rakuten, although Rakuten still comes out as number one in apparel and food sales online.

Familymart-Uny deal finally inked in October
Folli Follie opens Ginza and other stores for Folli Follie and Links of London
2016 is the year of the Monkey – and red underwear
IKEA Touchpoint store opens in Kumamoto
Nespresso opens first SC store, more to follow
Isetan-Mitsukoshi to open men’s store in Marunouchi in December
Innerwear & Hosiery market down 3%
Mitsubishi Estate Simon plans 10th outlet mall
Chiyoda optimistic about recovery
Swedish home fashion brand Almedahls launches in Japan
Cross Company unveils cultural website and fashion rental service for own brands
Consumption still weak
Isetan-Mitsukoshi ties with event planning firm to develop wedding business
Kokubu acquires stakes in Nacs Nakamura, Arista
Daiwa House to open huge e-commerce logistics centre in Osaka
GU forecasts 32% jump in sales this year
Xebio centralises Kanto stores under Victoria
Ain Pharmaciez expanding at home and overseas
Seven Eleven enters Tottori, now in all prefectures


Companies and Brands mentioned in this issue (number denotes page number)

A. Testoni, 3
A. V. V, 6
ABC Mart, 7
Adidas, 13, 17
Aeon, 8-9, 11-12, 14, 16-17
Ain Pharmaciez, 11
Akachan Honpo, 9, 17
Almedahls, 7
Amazon, 3-5, 10-11
Amu Plaza, 13
Apple, 10
Arista, 9
Art de Pain, 4
Askul, 5, 11
Belle Maison, 11
Bon Bon Home, 9
Botanical Force, 9
Calbee, 5
Cedar Crest, 7
Chiyoda, 7
Circle K Sunkus, 3, 5
Cookpad, 11
Cross Company, 8
Daiei, 10
Daimaru-Matsuzakaya, 3
Daiwa House, 10
Donna Karan Japan, 6
Eki Marche, 15
Epsilon, 10
Estnation, 8
Excite Japan, 7
Expocity, 14, 16-17
Facebook, 11
Fancl, 9
Fast Retailing, 10
Flying Tiger, 7
Folli Follie, 3-4
Fukaya, 6
Gibo, 6
GU, 10
Gunze, 4
Hankyu, 14
Hokkaido Express Delivery, 5
IKEA, 4-5, 7
Isabel Marant Etoile, 8
Isetan, 3-6, 9
Itochu Shoji, 7
Jean Paul Gaultier, 5, 8-9
Jil Sander, 6
Joseph, 6
JR West, 11, 15
Karuizawa Prince Shopping Plaza, 13
Kokubu, 9-10
Lalaport, 3, 5, 7, 13, 16
Laox, 1, 3, 6
Lawson, 5
Lazona Kawasaki, 13
Limited Edition, 3, 5, 8
LINE, 3, 5, 8-9, 11
Links of London, 3
Loft, 9
Lohaco, 11
Lucua, 15
Lumine Est, 4, 8, 14
Mark IS, 16
Marronier Court, 13
Marubeni, 9-10
Maruetsu, 10
Me-Ality, 9
Mechakari, 8
Medio Yakkyoku, 11
MI Plaza, 17
Michel Klein, 6
Midori Nagano, 14
Million Doors, 3
Mitsubishi Estate, 6, 14, 16
Mitsubishi Estate Simon, 6
Mitsui Real Estate, 14
Muji *****
Nacs Nakamura, 9
Nanaco, 10
Nespresso, 5
NEWoMan, 8
Nifrel, 7
Nishi Nihon Pharmacy, 11
Nissei, 5
Odakyu, 17
Omni7, 4-5, 8-9, 11
Onward Holdings, 6, 8
Origami, 3
Panasonic, 10
Parco, 14
Plan-Do-See, 9
Please, 20
Ponta, 10
Rakuten, 1, 10-11
Rolex, 4
Sanyo Shokai, 6
Sapporo, 13
Sazaby, 8
Seibu, 8-9
Seiyu, 3, 11
Sept Premieres, 9
Sevenpark, 9
Shiseido, 11
Sogo Seibu, 8-9
Sony, 10
Suning Commerce Group, 1
Super Sports Xebio, 10
T-Points, 10
Takashimaya, 1, 3-4, 13-15, 17
TBS Group, 7
The North Face, 17
Tobu, 13
Tokyu Corp, 15
Tomorrowland, 8
Toshin Kaihatsu, 14
TSI Holdings, 6
Uniqlo, 4, 10-11
Uny, 3, 5
Urban Research, 17
Victoria, 10-11
Wacoal, 4
World, 2, 4, 6, 11, 17
Xebio, 10
Yahoo Japan, 5
Yamato, 5
Zozotown, 11


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