February 5 2024

E-commerce consolidates as profits soar

Highlights from JapanConsuming monthly report

News and Analysis on Japanese retailing and consumers

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February 2024 Issue

E-commerce review: omnichannel consolidation

E-commerce growth slowed marginally as the sector consolidated post-Covid but remained higher than any other channel in 2022. By 2025-26, it will be the largest retail channel, overtaking convenience stores – although the reality is that Japan’s continuing support for its retail store structure means that omnichannel will be the model adopted by most. As a result, the majority of transactions will be researched, initiated, and fulfilled through a combination of online and physical stores.

Goldwin: sustainable records

Goldwin has had a remarkable run of record sales and profits, a beneficiary of the continuing growth in the outdoor market as well as its own retail strategy. Although much of its success has come from The North Face, Goldwin is determined to become a more diversified – and global – sports business. It presents a case study of how outdoor and sportswear is developing in Japan.

Kintetsu expands franchise model

Kintetsu has been expanding the number of direct franchises in its stores for the past five years. Now, with plans to open as many as 100 franchises both in its own properties and in third-party locations, including new franchises from overseas, the department store hopes for nearly 40% of sales from this source by 2026.

Mercari card ups user numbers

Mercard, the credit card launched by Mercari in late 2022, is a big success, helping the digital flea market provider grow its user base. The rate of growth in online flea markets has slowed, however, and Mercari will introduce a new gig-work service this Spring to further differentiate its business from the likes of Rakuma and Yahoo Flea Market.

Pal Group: another record as founder retires

Pal Group’s founder retired last month after 50 years at the helm during which he took the fashion to variety store business from ¥10 billion in 2001 to a forecast ¥184 billion this year.

Itochu plans faster pace of investment in fashion

Itochu may prefer to avoid the spotlight but it is one of the largest players in fashion distribution through a multitude of subsidiaries and affiliates. Having just posted record net profits, the trading firm’s fashion arm is aiming to maintain this level and then raise it substantially in the long-term by adding more brands, expanding categories like footwear, sports and cosmetics, and increasing direct investment in stores and e-commerce.

Less beer and sake, more highballs

Japanese beer has long been famous for quality and quantity and today its top brands are major exports. At home, however, the pandemic worsened a long-term decline in beer consumption (as well as wine and sake) as younger consumers switch to stronger drinks. Unit sales have shrunk but consumption of alcohol per unit has soared.

Sweet Honeys: a profit machine 

Low cost apparel retailers have enjoyed a significant uptick in the past few years as consumers look to polarise their spending further between cheaper basics and luxury treats. But the real change is in its improving profitability. Can it last?

More department store closures as sales recover

More department stores continue to close. While there has been a big improvement in trading, sales for the sector overall remain below pre-Covid levels and performance is sharply divided between stores in the centres of major cities and the rest.

More retail media for brands

The growth in retail media (brand advertising delivered in stores based on detailed customer data) continues to be one of the big trends in 2024. Most large retailers are keen to add this new revenue stream – and lots of brands want to advertise with them – but many retailers still need help from experts in advertising and data analysis to make it work.

Aeon: logistics issues drive efficiency

Restrictions on driver overtime are forcing logistics rationalisation across supply chains. Aeon is one of the few retailers that runs its own logistics platforms but, even so, changes to logistics practices will feed through to how stores are merchandised and could result in competitive pressure on smaller chains.

Retail Data: Spending on fashion rises

IN BRIEF

Aeon seeks to double shareholding in Tsuruha

Ebay Japan launches FMCG mall targeting women

Ginza rents expected to continue rising in 2024

Matsuya acquires luxury online mall, Milleporte

Inbound tourists up 8.2% on 2019 in December

Mitsubishi confirms Shibuya redevelopment

Narita to increase capacity by 66%

Aeon ends ties to TakaQ

Nagoya gets new 93-store landmark

Weddings with pets

72% of firms in Tokyo have no succession plan

Yaoko to acquire Sendo

Tabio trials unmanned store system

Shopping malls up 4.6%

Chateraise aims for 2,000 stores

Tennoji Mio strengthens fashion profile

Unbranded electronics now preferred

United Arrows unveils new brand for millennials

Strasburgo signs Italian brand Santoni

Ginza Six refresh with 16 new tenants

Hirotaka opens 9th store

More people looking to change jobs

Hermes Okayama to close

Coachtopia bag brand to get 10 stores by Spring

PayPay pocket money

VR options at IKEA

Hokkaido milk goes premium in Okinawa

Brands and companies in this Issue

Acne Studios, 10
Adastria, 1, 9
Adidas Originals, 10
Aeon, 1, 3, 6, 9, 12–14, 16–17, 19
Amazon, 16–19, 22
Amer Sports, 4
And Wander, 10
Anna Sui, 6
Anta, 4, 6
Askul, 1, 3, 17, 19, 22
Atelier Nikitiki, 7
Attisession, 10
B4F, 4
Baycrews, 7, 9
Belluna, 17
Bic Camera, 19
Blackmore, 8
Brewed Protein, 3
Cainz, 4
Cath Kidston, 7
CBRE, 4
Chateraise, 8–9
Ciao Panic, 6
Cinema Club, 9
Coachtopia, 12
ColorMe, 22
Colza, 9
Coronet, 6
Cox, 6
Creema, 22
Daichi, 16, 19
Daimaru, 1
Daks, 6
Descente, 6
Don Quijote, 12
Ebay Japan, 3
EccLab, 22
Emilio Pucci, 6
Evisu, 10
Familymart, 4, 12
Fast Retailing, 17, 19
Fila, 6
Futureshop, 22
Gallarda Galante, 6
Genky, 1
Genten, 6
Gherardini, 6
Ginza Six, 10
Glory, 12
Goldman Sachs, 4
Goldwin, 1, 3–4
Green Beans, 16
GU, 19
Hakuhodo, 12
Harukas Smile, 4
Hermes, 11–12
Hirotaka Inoue, 11
Hitachi, 9
Hoka, 7
Honeys, 8–9
Ichibata, 10
IKEA, 13, 17
Iris Ohyama, 9
Isetan Shinjuku, 11
Itochu Shoji, 4, 6, 10
Japanet Takata, 19
Jeansmate, 7
Joshin Denki, 19
Jun, 23–24
Jungsaemmoool, 7
Kate Spade, 12
KDDI, 22
Kengo Kuma, 3
Kintetsu, 1, 4, 11
Kirin, 7–8
Komeri, 1, 17
Kuipo, 6
Lanvin, 6
Lawson, 22
Locondo, 6, 22
Lohaco, 3, 17, 19, 22
LY, 18–19, 22
Magaseek, 22
Maison Hirotaka, 11
Maison Margiela, 10
Maison Okazaki, 11
Maji Treats, 4
Majica, 12
MakeShop, 22
Mercard, 5
Mercari, 1, 5, 19, 22
Milleporte, 4
Minne, 22
Misaki Shoji, 6
Mitsubishi Estate, 5
Mitsubishi Shokuhin, 12
Mitsukoshi, 1
MM6, 10
Molton Brown, 7
Mude, 7
Nakamura Tea, 10
Narita Airport, 5
Neutralworks, 1, 3–4
Nitori, 1, 17
Noin, 7
Oasis Management, 3
Ocado, 16
Outdoor Products, 7
Pal Group, 1, 5
Panasonic, 10
Patrick Cox, 6
Peroni, 8
PPI, 12
Qmart, 3
Qoo10, 3, 22
QVC, 17
Raemi, 7
Rakuma, 5, 19, 22
Rakuten, 5, 12–14, 16–19, 22
Reebok, 6
Regal, 10
Rizap, 7
Ryohin Keikaku, 17
Santoni, 10
Secoma, 13
Seibu Ikebukuro, 11
Seicomart, 13
Seijo Ishii, 4, 18
Sendo, 7
Seven Eleven, 9, 12, 15
Shima Seiki, 3
Shimamura, 1, 9, 15
Snow Peak, 3
Spiber, 3
Staff Start, 3, 6, 9
Strasburgo, 10
Style Factory, 4
Suntory, 8
Tabio, 8
TakaQ, 6
Takashimaya, 1, 11
Tapestry Japan, 12
Tokyo Mercato, 4
Tokyo Tatemono, 3
Tokyodo, 7
Tokyu Store, 12
Tonymoly, 7
Tsuruha, 1, 3
Tutuanna, 4
Uber Eats, 15
Uniqlo, 1, 8–9, 19
United Arrows, 1, 10
Valor, 18
Welcia, 3
Wonderplace, 7
Workman, 1, 8–9, 15
Yahoo, 5, 14, 17–19, 22
Yamada Denki, 19
Yaoko, 7
Zozo, 22

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