With their domestic market shrinking, many Japanese department store operators are turning their attention to Southeast Asia, where the growing middle class presents a wealth of new opportunities.
Isetan Mitsukoshi Holdings opened “Isetan The Japan Store Kuala Lumpur” at the end of October. One local shopper in her 50s, who bought a handbag, said what matters is quality, not price.
The operator joined hands with the public-private Cool Japan Fund to fully revamp its existing store. The store sells Japanese clothing, food and anime-related goods, targeting locals keen on Japanese quality.
The previous outlet, which opened in 1990, targeted Japanese expats and tourists, whose number had increased on the back of the country’s rapid growth but dropped after the bubble burst.
The “Japan” brand has a profound effect on Southeast Asian consumers. “We have requests from consumers for more Japanese products,” said Takashi Hayano, chief executive officer of PT Retail, which runs the Tokyu Department Store in Thailand.
Tokyu opened its second outlet in Bangkok’s suburbs in June 2015. In July this year, the company refurbished the clothing and shoe department to market Japanese goods. Sales jumped 50% from a year earlier.
Isetan Mitsukoshi President Onishi said the strategy of bringing people in by focusing on Japan can be adopted at other overseas locations.
Isetan will also team up with Japan’s Nomura Real Estate Holdings to open the first Japanese department store in the Philippines.
Japan’s department store market has shrunk to two-thirds of its peak. “It is becoming increasingly difficult for operators to open an outlet on their own, sell products and pay high rent,” said Onishi.
(Source: Nikkei Asian Review)