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Tsutaya .vs. Rakuten

Tsutaya .vs. Rakuten. M-Commerce: Leveraging Retail Sales through the Mobile Platform May Su Aung – msaung@iuj.ac.jp Bryan Copeland – bcpld@iuj.ac.jp. TSUTAYA: Profile.

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Tsutaya .vs. Rakuten

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  1. Tsutaya .vs. Rakuten M-Commerce: Leveraging Retail Sales through the Mobile PlatformMay Su Aung – msaung@iuj.ac.jp Bryan Copeland – bcpld@iuj.ac.jp

  2. TSUTAYA: Profile Net Sales: 3,043 million ¥Ordinary Income: 579 million ¥Net Income: 436 million ¥* TOL – Tsutaya Online** Estimated, year ended March-to-March, 2006 fiscal year; based on $1 = ¥132.06

  3. Approach to Mobility How does Tsutaya do it? • In 1994, CCC built a sizeable customer database • Maintain a dynamic, always-on picture of individual entertainment tastes and preferences and personalize product offerings by combining data with mobility via i-Mode service. How does it all work for the consumer? • TOL*, Tsutaya’s wireless i-Mode site, email consumer whenever the next release of the brand which consumer bought last time is available (or notify about clearance sales) *Case Study -- Tsutaya, a Tokyo Video Store, Goes Mobile: http://www.cioinsight.com/c/a/Past-News/Case-Study-Tsutaya-a-Tokyo-Video-Store-Goes-Mobile/

  4. Business Strategy Store Development Strategy Bringing the 3000-Store Vision to Reality • The market radius for its retail locations: a 10 minute customer destination • They envision the potential to develop and open 3,000 stores in Japan by assuming that one TSUTAYA location exists for every 40,000 citizens.

  5. Enhanced IT to Support Store Operations • The CCC has developed a number of information technologies (IT) • To support operations, including the (AMS) • To analyze daily and hourly product movement at each store • To execute rental product orders at franchise headquarters on behalf of franchisees. • The CCC connected all stores to franchise headquarters with a knowledge-sharing system called TSUTAYA NAVI, an IT platform for creating & sharing insights to support the resolution of store operating concerns.

  6. Clicks & Mortar (C & M) • To generate synergies between physical TSUTAYA in-store services and the Internet entertainment portal (TOL). • Provide a Marketing function: TSUTAYA online, retail customers and TSUTAYA stores are directly connected via Internet. • This connection, both pinpointed and immediate, provides a marketing function that other companies do not possess.

  7. Monthly Sales & Membership

  8. Member Growth(Customer Acquisition Strategy) • 60% of 19-year-olds in Japan are "active Tsutaya members”

  9. Market Share (FY2005) Share % in parentheses: Unit billion yen

  10. RAKUTEN – Profile Net Sales: 33,636 million ¥**Ordinary Income: 6,937 million ¥**Net Income: 3,731 million ¥*** ALL Raktuen Divisions** ALL Rakuten Divisions; Estimated, year ended March-to-March, 2006 fiscal year; based on $1 = ¥132.06

  11. Rakuten – Mobile Strategy • Eyeing mobile auction market • Partnership with NTT DoCoMo on Rakuoku • Spin-off of Rakuten Auctions on the Mobile • DoCoMo has a 40% stake (4.2 billion 円) Case Analysis – Rakuten Ichiba: http://www.slideshare.net/icestorm/case-analysis-rakuten-ichiba-presentation

  12. Rakuten – Mobile Storefront

  13. Rakuten – Financial Highlights • Travel Bookings via Mobile Phone

  14. Rakuten – Business Model

  15. Rakuten – Operating Margin

  16. Rakuten – Mobile Future • Pushing Rakuten Auctions on the Mobile • Tie-up talks with Tokyo Broadcasting Systems, Inc. (TBS); Internet TV negotiations • M-commerce, focused on: • Recommendation technology • Captivating Contents • Product-placements • Ad Relevancy • Increased Auction traffic/sales

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