TOKYO — Isetan is on an expansion drive in China, with the goal of eventually operating 10 stores in the country.
The impetus for growth is the Mei Long Zhen Isetan in Shanghai, which opened in 1997. The store is performing extremely well and is one of five units Isetan currently operates there. The others are in Shanghai Huating, Tianjin, Jinan in Shandong Province and Chengdu in Sichuan Province. The company plans to open a Shenyang store in Liaoning Province this year and another store is slated to bow in Beijing in 2008.
The Mei Long Zhen store opened on West Nanjing Road four years after Isetan unveiled its Huating Isetan location in Huaihai Zhonglu, the first foreign-financed department store in China. The Mei Long Zhen unit, which is 161,450 square feet, doesn't carry any food. Rather, it's narrowed its focus to specialize on fashion. Mei Long Zhen's target customers are senior executives of foreign-affiliated companies, the top echelon of employees of national companies and top Chinese government officials. The monthly household income of the target customer is about 8,000 yuan to 10,000 yuan ($1,056 to $1,320).
Frequent shoppers, who make up 26 percent of the store's business, are between 32 and 36 years old. Consumers between the ages of 27 and 31 account for 21 percent of sales and the 37- to 41-year-old age group makes up 20 percent. The 20- to 29-year-old age range is gaining strength, the company said.
With these demographics in mind, Mei Long Zhen is expanding its selection and strengthening services aimed at younger shoppers. "There are more groups of new rich, such as businessmen for rising IT companies and entrepreneurs in their 20s," said Akifumi Morita, managing director of the Mei Long Zhen Isetan. "Also, more people born after the one-child policy started in 1979 have had foreign experiences. They're good department store customers and we would like to cater more to this group."
Morita said changes in customer preferences include an awareness of foreign brands. "There are definitely people who will buy overseas brands even if they are more expensive," Morita said. "However, a growing number of consumers will buy items that have good quality and don't insist on luxury brand logos. They are our new target customers."Onward Kashiyama Co. Ltd.'s 23-ku line has some of the attributes Isetan is looking to offer its new consumers. "We'd like to carry items that have a certain quality level and trendiness, and also have an accommodating price range," Morita said.
Isetan offers a variety of sizing as a strategy to gain customer loyalty. In March, the retailer adopted Size Site by Onward Kashiyama, a well-received system, which features tall and large sizes in addition to the standard small, medium and large. Size Site applies to brands such as ICB, Kumikyoku and 23-ku.
Isetan's club card strategy is another point of difference in the market. The Mei Long Zhen unit has 45,000 club members and added 15,000 new names last year. The client management system raises the level of sales and has been closely watched by Chinese competitors.
With such business endeavors, sales at the Mei Long Zhen store are expected to keep ticking upward. For the year ended Dec. 31, 2006 — the most recent figures available — sales were 8.95 billion yen, or $75.2 million, a 107 percent increase over the previous year's 8.36 billion, or $70.3 million. Pretax profits, which have also been growing steadily, reached 786 million yen, or $6.6 million, in 2006, up from 643 million yen, or $5.4 million, the previous year. Profit as a percentage of sales was 0.8 percent at the Mei Long Zhen store, compared with a 5 percent rate at Japanese headquarters. The Mei Long Zhen unit's consolidated profit was the sixth highest of Isetan's 29 consolidated subsidiaries.
Since most of Isetan's clients and Japanese apparel companies are based in Shanghai, Mei Long Zhen plays an important role in communicating the company's goals and acts as a contact for business negotiations. It also has an educational role; it's where Isetan trains staff when it opens new stores in China.
@chanel and @pharrell dropped what’s being dubbed as the world’s most exclusive sneakers yesterday. The Adidas Originals NMD Hu, which Williams designed in collaboration with Chanel and @adidasoriginals, has a waiting list of over 120K people who pre-registered online at chanelatcolette.fr –– and only 500 pairs are on sale. The singer predicted the resale value of the shoes could reach $40K. Read the full interview on WWD.com. Link in bio. #wwdfashion (📷: Dominique Maître)
@imanshumpert is diving deeper into his creative endeavors and relaunching his clothing line, Post 90s, and is helping to raise money for the hurricane victims in St. Maarten with a jersey he’s designed with his brother. The Cleveland Cavaliers player talked to WWD about kneeling during the national anthem, working with fashion brands and how he wants to be more than an @nba player. Read the interview on WWD.com #wwdfashion (📷: George Chinese)
Not only does #TheProfit return to CNBC tonight, but @marcuslemonis has launched @shopmarcus, a new shopping and lifestyle retail experience in Aspen and Chicago, with more locations to come. The retail stores offer in-store stylists and a variety of contemporary womenswear selections.
“It’s life, I’m going to face it,” @mingxi11 sighed. “I fell, but you know, I think the most important thing is that I get back up. I had the love, the help from my sister — the girl next to me Gizele [Oliveira] — she’s so nice. When I went backstage everybody was trying to comfort me like ‘Oh Ming, it’s OK.’ I’m really, really touched. I think it’s them who gave me the courage to go back on stage for the finale,” Xi told WWD of her fall at the @victoriassecret fashion show. (📷: David Fisher) #wwdfashion #vsfashionshow #victoriassecret
@louisvuitton tapped @therealpeterlindbergh for its latest city-centric photo book, which is part of a series called Fashion Eye. The primarily black and white book captures the spirit of Berlin in 57 images shot between 1989 and 2019. “Berlin is an inspiration for me, more than a city. I mean @millajovovich is simply Berlin!” said Lindbergh. #wwdfashion
“You know, I think audiences expect a certain performance so I have to deliver to them what they’re expecting to a certain degree. But I’m also a different actor and a different person, I have my own spin on the character,” says @noahegalvin of his takeover of the leading role in “Dear Evan Hansen” following the departure of @bensplatt, who originated the role. Read WWD’s interview with the 23-year-old actor on WWD.com #wwdeye (📷: @jilliansollazzo)
For pre-fall 2018, @etro created richly-colored wonderland, using tapestries, textiles and wallpapers from the Eastern world at large. The line featured floral and graphic prints and jacquard motifs, like this two-piece look featured here. #wwdfashion (📷: Giovanna Pavesi)
@kith is moving into children’s. The men’s and women’s streetwear brand has launched Kidset, a Kith kids line located in New York at 64 Bleecker Street. The line includes mini versions of staple Kith pieces like the Astor bomber jacket and the Kith box logo sweatshirts, along with a wall that can display up to 120 pairs of shoes from @adidas, @newbalance, @timberland and more. #wwdfashion
“I just wanted to create this fully rounded character, but I do think what excited me most was just the opportunity to give a group of people representation that I feel needs it. I like to do characters in projects that stand for something and Karolina definitely does, so that was really exciting to me,” @ginnygardner says of her new role in @hulu’s “The Runaways.” Gardner plays Karolina Dean, a queer superhero, which is a rarity for @marvel. Read more about Gardner’s character on WWD.com #wwdeye (📷: @dandoperalski)