It never rains but it pours for Japan's department store operators, once the driving force behind Japan's bubble-era consumerism. This summer already-flagging sales plunged further as recession-hit consumers cut back on spending. Nature didn't help out, either, as poor weather hurt sales.
Yet, even when the recession eases and the weather improves, don't expect a big bounce in sales. These days, Japan's recession-hit shoppers increasingly prefer to shop without ever leaving home.
The numbers are startling. Using data from the Japan Direct Marketing Assn. and Nomura Research Institute [NRI], the Nikkei daily estimates online shopping sales in Japan rose 22 percent to $67.2 billion. That's despite Japan's deepest recession in the postwar era savaging consumer confidence following the collapse of Lehman Brothers last fall.
If catalog shopping is also included, the figure rises to over $86 billion -- or more than is spent in Japan's department stores or ubiquitous convenience stores. Noritaka Kobayashi, senior consultant at Nomura Research Institute in Tokyo, says that while the growth will likely slow due to the recession, the consumer e-commerce market will continue to outstrip other forms of shopping. Excluding eating out and other forms of consumption that can't be easily conducted online, Kobayashi reckons $2.2 trillion of consumption could be made from computers and cell phones. "A growing number of people are simply avoiding the trouble of visiting stores," he says. "This market has a big growth potential."
Sugomori: "Chicks in the Nest"
What explains Japanese consumers' shift to shopping online? In the last year, as the global recession pounded the Japanese economy, pundits began using the term sugomori ["chicks in the nest"] to describe people who stay home to keep outside expenses to a minimum. Shopping online is not only often cheaper, especially when compared with expensive department stores, but it also saves on transportation and eating out while shopping.
Other reasons for the rapid expansion of online shopping in Japan are perhaps more compelling -- and Japan-specific. One factor is undoubtedly the widespread use of high-speed Internet. Fast broadband connections are the norm in Japan, while high-speed Internet-enabled china mobile phones are long established. NTT DoCoMo's 3G service is now in its 10th year of operation. The upshot: Japanese young and old are comfortable and experienced online.
According to the Internal Affairs & Communications Ministry, the mobile-commerce market in 2007 was worth $7.8 billion, a 29 percent increase from the previous year. The NRI, meanwhile, estimates mobile phones account for about 20 percent of online shopping and that share will increase to 24.5 percent by 2013. "Sooner or later it will be half," says Kobayashi. He adds that many teenagers buy games, books, or accessories via mobile phone but never use a PC for e-commerce
Superior Delivery Service
It helps that workers in Japan typically take long commutes, often in crowded trains. That leaves plenty of time to text, read the news, play games, or shop using a mobile phone.
Marketers are also getting savvier at appealing to mobile shoppers. While eBay isn't a big player in Japan, Rakuten, Amazon Japan, and Yahoo Japan are among Japan's most visited Web sites and are huge conduits for online shopping. Small players, meanwhile, are finding creative ways to woo Net-based shoppers. One example: In March, dozens of young women swarmed to the Tokyo Girls Collection fashion show. At the show, held in Tokyo's youthful Shibuya district, audience members could order what they saw on the runway using their mobile phones, via a dedicated retail site. In a single night, the show sold $615,000 worth of clothes.
Meticulous home-delivery service is another factor boosting online shopping. Delivery companies such as Yamato Transport, Sagawa Express, and JP Express are famously reliable. The companies usually offer to deliver within a two-hour time slot selected by the customer and are rarely late. They are also remarkably fast. Yamato, for instance, has a tieup with Amazon and other mail-order companies by which it offers next-morning delivery for orders made by midnight the previous day. And if the customer prefers, deliveries can be made to one of Japan's 50,000 convenience stores. For only a small extra fee, delivery firms will deliver frozen or chilled products, leading to the rapid expansion of online purchasing of fresh produce, such as freshly caught crab from Hokkaido or pineapple from subtropical Okinawa.
Payment options have evolved to meet customer needs and soothe fraud concerns. For consumers who don't want to input credit-card numbers over the Internet, Yamato and others offer a pay-on-delivery service. "These finely tuned delivery services are boosting the mail-order business," says Masao Ueda, chief researcher at the Distribution Economics Institute of Japan.
Buy best cell phone, tv mobile phone, cheap china phone, quad band cell phones at China-Phone.Org
