Zozotown, which swooped in as a little-known retail website and prodded once-reluctant Japanese consumers to shop online for clothes, is now facing stiff competition in the industry whose image it remade.
Arriving on the scene in 2004, the site made a killing selling clothes from shops such as Japanese boutique United Arrows and minimal French label APC. Zozotown’s success turned its founder into one of Japan’s richest entrepreneurs, and its name adorns a baseball stadium. But its dominance is being challenged, with retailers expanding their e-commerce offerings and big names such as Amazon and SoftBank Group Corp eyeing a piece of the growing business.
At stake is a $120bn fashion market that was almost entirely dominated by brick-and-mortar stores until a few years ago, but is transforming amid the proliferation of smartphones and home delivery.
Online fashion sales have grown to over 10% of the total Japanese market in the past few years – with Zozotown at the head of the pack – and are likely to surpass 20% in three years, according to Nomura Securities.
“There needs to be a second player, and we are putting up our hand,” said Yusuke Tanaka, founder and chief executive of fashion website Locondo Inc.
To differentiate itself, Locondo specialises in shoes and, unlike Zozotown, offers free returns – still a rarity in Japan. It also shares inventory with fashion site Magaseek. For now, Zozotown is “totally sweeping the board,” said Yuki Ando, general manager of web business at Sanyo Shokai Ltd, the fashion company behind lines such as Mackintosh Philosophy.
Zozotown is operated by Zozo, officially called Start Today Co Ltd. The website set itself apart in its early days with a clean, uncluttered design and a slice of “Ura-Hara” style – the modish fashion of the backstreets that line the trend-setting Harajuku district of Tokyo.
Business took off as fashion-conscious professionals in their late twenties and early thirties started using Zozotown to buy trendy but work-appropriate threads online from labels such as United Arrows and Nano Universe.
Its target is now broader, selling over 6,800 brands including, starting next week, clothes by Shimamura Co Ltd, one of Japan’s largest mass market chains.
But industry executives say it still has an enviable cachet. Zozotown has an “overwhelming ability to attract customers,” says Takahiro Kinoshita, a manager in the digital marketing department of United Arrows.
In February, fashion company Stripe International launched Stripe Department, an online joint venture with SoftBank Group Corp.
The site features recommendations by stylists, and targets a user base that’s slightly older than that of Zozotown, the company says.
Amazon is trying to raise its fashion credentials in Japan, sponsoring catwalk shows in Tokyo. The head of Amazon Japan’s fashion unit, James Peters, says fashion is one of the company’s fastest-growing areas, but declined to provide figures.
Retailers that had historically focused on expanding their physical presence are also shifting to e-commerce. Japan’s Fast Retailing Co Ltd, which controls the Uniqlo brand, is trying to grow online sales, which are currently less than 8% of the company’s total. Chief executive Tadashi Yanai said he wants to see that to rise to 30%. Even the brands that drove Zozotown’s early success are now competing with it. United Arrows still makes almost 60% of its online sales through Zozotown.
But sales on the brand’s own website are growing rapidly too – up 35% in the last fiscal year, which ended in March.
Fashion company Bay Crew’s Group said 30% of its online sales come from Zozotown.
But 60% are through its own website, generating precious customer data, said Jun Shimada, a senior executive.
Foreign companies are helping Japanese retailers polish their online presence.
Sweden’s Virtusize, for instance, adds code that allows users to compare the fit of items to those they already own.
“Our biggest market by far is Japan, where close to 20% of all online retailers use Virtusize,” said chief executive Gustaf Tunhammar, adding that Europe was the second-largest market, and that “only a handful” of retailers in the US used the technology.
Japan is also one the largest markets for UK-based 3D-A-Porter, which offers three-dimensional body scanning and virtual clothing try-on, according to CEO Lara Mazzoni.


Yusaku Maezawa, chief executive of Zozo, which operates Japan’s popular fashion shopping site Zozotown and is officially called Start Today Co, speaks at an event launching the debut of its formal apparel items in Tokyo yesterday.
China’s Baidu rolls out self-driving buses
AFP
Beijing




China’s Internet giant Baidu announced yesterday it had begun mass producing the country’s first autonomous mini-bus, as the firm prepares to roll them out in tourist spots and airports.
CEO Robin Li watched the 100th vehicle roll off a production line of a factory in the southeastern city of Xiamen.
“2018 marks the first year of commercialisation for autonomous driving.
From the mass production of Apolong, we can truly see that autonomous driving is making great strides – taking the industry from zero to one,” said the CEO. The 14-seater Apolong, about one-third of the size of a normal bus, has no steering wheel, driver’s seat, accelerator or brake.
Co-produced by Baidu and Chinese bus manufacturer King Long, they will soon be pressed into commercial use in enclosed areas such as tourist areas and airports in several cities including Beijing, Guangzhou, Shenzhen, and the country’s new megacity Xiong’an.
Early next year, they are set to enter Japan’s self-driving market as shuttle buses at nuclear power stations or in Tokyo to ferry around elderly people in local communities.
The vehicles have the “fourth level” of automation as defined by the Society of Automotive Engineers, meaning they can operation within an enclosed location without human intervention.
This is one short of the highest level, where vehicles can operate anywhere on the road.
“I took a self-driving car to come to the developer conference last year, and ended up getting a ticket at (Beijing’s) fifth ring road,” Li quipped.
Baidu, often referred to as China’s Google, operates the country’s leading search engine and also invests heavily in services ranging from online payments to connected devices and artificial intelligence.
“In the past, China exported cheap commodities to the world. In the future, China will export AI technology to the world,” Li said at the firm’s annual AI developer conference.
He also announced a new AI chip called Kunlun at the conference, which can support a wide range of AI applications including voice recognition, natural language processing and autonomous driving.


An Apolong self-driving mini bus by King Long exhibited at the Consumer Electronics Show Asia in Shanghai. China’s Internet giant Baidu announced yesterday it had begun mass producing the country’s first autonomous mini-bus, as the firm prepares to roll them out in tourist spots and airports.


As Zozotown suits up, Japan’s online fashion revolution gathers speed


Reuters
Tokyo




Zozotown, which swooped in as a little-known retail website and prodded once-reluctant Japanese consumers to shop online for clothes, is now facing stiff competition in the industry whose image it remade.
Arriving on the scene in 2004, the site made a killing selling clothes from shops such as Japanese boutique United Arrows and minimal French label APC. Zozotown’s success turned its founder into one of Japan’s richest entrepreneurs, and its name adorns a baseball stadium. But its dominance is being challenged, with retailers expanding their e-commerce offerings and big names such as Amazon and SoftBank Group Corp eyeing a piece of the growing business.
At stake is a $120bn fashion market that was almost entirely dominated by brick-and-mortar stores until a few years ago, but is transforming amid the proliferation of smartphones and home delivery.
Online fashion sales have grown to over 10% of the total Japanese market in the past few years – with Zozotown at the head of the pack – and are likely to surpass 20% in three years, according to Nomura Securities.
“There needs to be a second player, and we are putting up our hand,” said Yusuke Tanaka, founder and chief executive of fashion website Locondo Inc.
To differentiate itself, Locondo specialises in shoes and, unlike Zozotown, offers free returns – still a rarity in Japan. It also shares inventory with fashion site Magaseek. For now, Zozotown is “totally sweeping the board,” said Yuki Ando, general manager of web business at Sanyo Shokai Ltd, the fashion company behind lines such as Mackintosh Philosophy.
Zozotown is operated by Zozo, officially called Start Today Co Ltd. The website set itself apart in its early days with a clean, uncluttered design and a slice of “Ura-Hara” style – the modish fashion of the backstreets that line the trend-setting Harajuku district of Tokyo.
Business took off as fashion-conscious professionals in their late twenties and early thirties started using Zozotown to buy trendy but work-appropriate threads online from labels such as United Arrows and Nano Universe.
Its target is now broader, selling over 6,800 brands including, starting next week, clothes by Shimamura Co Ltd, one of Japan’s largest mass market chains.
But industry executives say it still has an enviable cachet. Zozotown has an “overwhelming ability to attract customers,” says Takahiro Kinoshita, a manager in the digital marketing department of United Arrows.
In February, fashion company Stripe International launched Stripe Department, an online joint venture with SoftBank Group Corp.
The site features recommendations by stylists, and targets a user base that’s slightly older than that of Zozotown, the company says.
Amazon is trying to raise its fashion credentials in Japan, sponsoring catwalk shows in Tokyo. The head of Amazon Japan’s fashion unit, James Peters, says fashion is one of the company’s fastest-growing areas, but declined to provide figures.
Retailers that had historically focused on expanding their physical presence are also shifting to e-commerce. Japan’s Fast Retailing Co Ltd, which controls the Uniqlo brand, is trying to grow online sales, which are currently less than 8% of the company’s total. Chief executive Tadashi Yanai said he wants to see that to rise to 30%. Even the brands that drove Zozotown’s early success are now competing with it. United Arrows still makes almost 60% of its online sales through Zozotown.
But sales on the brand’s own website are growing rapidly too – up 35% in the last fiscal year, which ended in March.
Fashion company Bay Crew’s Group said 30% of its online sales come from Zozotown.
But 60% are through its own website, generating precious customer data, said Jun Shimada, a senior executive.
Foreign companies are helping Japanese retailers polish their online presence.
Sweden’s Virtusize, for instance, adds code that allows users to compare the fit of items to those they already own.
“Our biggest market by far is Japan, where close to 20% of all online retailers use Virtusize,” said chief executive Gustaf Tunhammar, adding that Europe was the second-largest market, and that “only a handful” of retailers in the US used the technology.
Japan is also one the largest markets for UK-based 3D-A-Porter, which offers three-dimensional body scanning and virtual clothing try-on, according to CEO Lara Mazzoni.