Transformation into a Department Store for a New Era (Platform Model)

「In “individual-customer business,” we will attract customers from around the world, identify them and propose diverse forms of customer value to those with whom we are connected. After deepening collaboration among businesses through federation activities, we will pursue new business opportunities using four areas of expansion as keywords: “the world,” “uses,” “spaces” and “time,” with the aim of expanding profits.」

「We will fully pursue the transformation of our business structure from “building-based business,” our previous mass-market business model based on department store buildings, to “individual-customer business,” based on connections with individual customers.」

「In September in particular, we held invitation events for valued customers, which can be seen as symbols of our key initiatives, the “high-sensitivity, high-quality strategy” and the “shift from a mass-market to an individual-customer business model”: Tanseikai at Isetan Shinjuku Main Store and Ippinkai at Mitsukoshi Nihombashi Main Store. By strengthening a broad range of items, from luxury brands and art to food, we won support from customers nationwide, and both events recorded their highest sales ever.」

「To realize our long-term vision, we will pursue our strategies in three steps: regeneration, expansion and fruition. In the regeneration phase, we will transform our business model through a “scientific perspective” and “personal marketing,” revitalizing our department stores and increasing the number of identifiable customers. In the expansion phase, the group’s companies will respond to customers’ broad needs through a “federation strategy” directed at identifiable customers. In the fruition phase, we will develop the federation strategy and establish the Mitsukoshi Isetan town-making model.」

「We are pursuing digital transformation to provide a seamless customer experience integrating physical stores and online channels. We have worked to improve customer convenience by launching online reservations and in-store pickup for events and by selling products through Mitsukoshi Isetan Remote Shopping.」

「To accelerate the transformation of our business model from the traditional department store model, structural reform and the development of our foundations, we are currently formulating a new three-year plan. The plan is centered on three key strategies: the “high-sensitivity, high-quality” strategy, the “connecting with individual customers” strategy and the “group federation” strategy. We plan to develop group-wide common infrastructure required to implement these strategies, including systems and data infrastructure, logistics infrastructure and human resources infrastructure.」

「At the Isetan Mitsukoshi e-commerce site, activity increased in response to stay-at-home demand for food, home-related products and other items. The Company strengthened its online offerings for year-end and New Year occasions and working-from-home demand, and online reservations and sales of Christmas cakes, osechi and lucky bags grew. The food delivery service “ISETAN DOOR” and cosmetics e-commerce site “meeco” also grew significantly, with total online sales exceeding ¥30,000 million in fiscal 2020. In November, the Company launched and began trialing the “Mitsukoshi Isetan Remote Shopping” app, which provides an online shopping experience similar to that of a physical store.」

「There is no change in the direction the Company is pursuing, but we will respond to the changes brought about by COVID-19. While proceeding with the planned reform of the business model for the retail (department store) business, we will further accelerate our digital shift and address 3 priority areas in response to changes in customer behavior, new lifestyles and changes in consumer behavior in anticipation of the with-COVID and post-COVID environment. The first is further strengthening the e-commerce business, the second is expanding One to One services using digital technology, and the third is providing a customer experience that enables customers to enjoy high-value-added shopping without visiting a store, or to shop in less time when they do visit, by creating a seamless experience in which they can move freely between online and offline channels, allowing them to shop more quickly, conveniently and safely.」

「While proceeding with business model reform in the retail, or department store, business as planned, we will further accelerate our digital shift and work on three priority areas in response to changes in customer behavior, new lifestyles and changes in consumption patterns in preparation for the with-COVID and post-COVID periods.」

「In June, we launched a new online site and app and are developing the infrastructure needed to provide equivalent services online and offline.」

「Our Group will continue to implement measures, including digitalization, aimed at realizing the vision set out in our three-year plan of becoming a “matching platform operator” connecting online and offline (stores).」

「Amid these uncertain conditions, our Group aims to create new value and achieve sustainable growth and development by bringing about “change” and “transformation” ourselves, using the goodwill, customers and other operating assets we have built up, together with the capabilities of IT, stores and people, to serve as a new-era platform operator connecting customers with products and experiences from around the world.」

「Based on “Our Way of Thinking,” established in April 2018, our Group aims to create sustainable growth and development by bringing about “change” and “transformation” ourselves, leveraging the goodwill, customers, and other valuable assets cultivated to date, together with the capabilities of IT, stores, and people, as a department store for a new era that connects customers with products and experiences from around the world.」

「To respond to these changes, our Group will pursue its medium-term management plan aimed at realizing its vision of a “department store of a new era (platform operator).” While continuing to develop infrastructure and reform our cost structure, we will shift our focus toward business model reform and steadily accelerate the key strategies for achieving it.」