Mobile Commerce Surges in Japan over Wireless Networks
Mobile commerce over cell phones jumped 25 percent last fiscal year to around 971 billion yen ($8.8 billion) according to a survey on e-business just released by Japan’s Ministry of Economy, Trade and Industry [.pdf in Japanese]. Covering all of fiscal 2004 (which in Japan ended March ’05), the survey showed wireless purchases of books and music had grown by 85 percent from virtually nothing the previous year to 330 million yen ($3 million). Shopping for clothing and accessories over the smallest screen accelerated 79 percent, taking in 150 hundred million yen ($1.3 million).Researchers for the report noted that consumers are comfortable with shopping on the Web, grouping it with other mainstream retail experiences. Individual online (Internet) purchases rose nearly 29 percent to 5.64 trillion yen in fiscal ’04. This confidence has users embracing the anytime, anywhere convenience of the mobile Web in addition to — and even sometimes preferably to – the PC experience.
Ministry findings showed services still accounted for the majority of mobile revenues (42 percent), followed by entertainment (21.4 percent), books and music (7.4 percent), travel (6.5 percent), health and beauty supplements plus cosmetics (3.7 percent), clothing and accessories (3.5 percent), and food (2.4 percent). Automobiles had its own category at 2.4 percent and financial transactions stood at 2.2 percent.
KDDI’s Chaku Uta Full, launched in November 2004, helped turn numbers around — the company recently announced their 10 millionth download -– and pushed DoCoMo and Vodafone to fine-tune their own music content, partnerships and handsets.
KDDI’s EZBookland portal launched too late to make any difference to book-related sales totals but should pull numbers up for 2005. TV-related contents are really just starting their campaign to engage subscribers in the run up to the start of digital terrestrial broadcasting. Percentages should shift in favor of travel, too, as mobile content providers tweak economical transportation and reservations services especially for last minute business/pleasure travelers.
The nascent success of mobile retailers like Girlswalker from Xavel Inc. has generated some big-time competition. This summer, Yahoo Japan is expected to launch an expanded mobile shopping portal with access to several thousand stores.
Corporate moves into this sector come with big-budget ad campaigns to create even more consumer awareness of this new medium. Dentsu, the country’s largest advertising company, reported online advertising for cell phones had increased by 80 percent in fiscal ’04 to around 18 billion yen (nearly $164 million). Overall Internet advertising grew to 181.4 billion yen ($1.67 billion) last year, up 53 percent. [.pdf in English].
— Gail Nakada