Retail in Asia


Isetan Shinjuku aiming for over USD2 billion sales from just one store

Japan’s Isetan Shinjuku is already by far the highest selling single retail store in the country by both total sales and sales densities, but it believes it can still improve.

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After posting sales of JPY253 billion (around USD1.8 billion) in FY2022, Isetan is now hoping for JPY300 billion (USD2.2 billion), possibly even in FY2022 ending March. This would be JPY100 billion (USD746 million) above second ranked Hankyu Umeda and JPY150 billion (USD1.1 billion) more than third-ranked Seibu Ikebukuro – sales densities are around double its peers.

The figure is ambitious but possible.The base of its efforts is the MI Card – or a virtual membership for those too wealthy to mess with bits of plastic. Isetan has created a new CRM system to first get people to sign up for a card and then maximise information on each customer in order to develop highly personalised marketing at both store and concession level.

Store card marketing is nothing new, but what is new is how the entire business is now organised around member acquisition and then upselling based on data gathered on each customer.

All staff, even top management, are incentivised to sign new card holders, and store promotions feature card incentives heavily to make shoppers aware of the benefits.

And it is working. For FY2022, the Shinjuku store expects 68 percent of sales to come from cardholders, compared to 50 percent in 2018.

The number of new MI card members in the first half of FY2022 increased by about 2.6 times on the year. Sales to Gold (JPY1 million or USD7,500 or more in annual spending) and Platinum card members (JPY3 million or USD22,500 plus) and VIP customers spending JPY10 million or USD 75,000 plus, increased 50 percent last year, and these account for 15 percent of total sales.

(Source: Japan Consuming)