Mitsukoshi Isetan’s new Osaka store – Spring 2011

As predicted in our April newsletter, there will be some major rebranding in the Mitsukoshi and Isetan portfolio of stores. The newly merged group of Isetan Mitsukoshi Holdings Ltd is to open its department store in Osaka in 2011 under the double branded Mitsukoshi Isetan name, rather than the initially planned Mitsukoshi brand. More significant is the fact that the new store will be managed by JR West Isetan, the joint venture company run by JR and Isetan that currently manages the JR Isetan store in Kyoto. In effect, it will mean current Isetan managers will be in charge of the new 50,000 sqm Osaka store which is forecast to have sales of ¥55 billion. This is perhaps not surprising; JR West Isetan has performed strongly, with sales growth for the last 10 consecutive years.
The use of the Isetan name will likely give a more competitive edge to the new Osaka store, and lure fashionable customers more easily, a necessity given the new competition from the recently opened Hankyu Mens Kan. In addition Hankyu will reopen its Umeda flagship store in Osaka in 2011 after a complete rebuild making for an intensely competitive local market for department stores. However the use of the double name is a compromise; Isetan executives were pushing for the store to be an Isetan store but were forced to concede the double name to help save face for Mitsukoshi. The saving of face could however end in a greater embarrassment if they fail to make the positioning clear and just end up confusing both Isetan’s more fashionable target and Mitsukoshi’s older customers.
The new double name is significant and may provide a compromise elsewhere; as reported in our monthly report, there was speculation that the new company would change the name of the Mistukoshi Ginza store to Isetan Ginza following a complete rebuild in 2010 but that there was still resistance from Mitsukoshi. A change to Mitsukoshi Isetan Ginza may provide the answer if an inelegant one.
On April 1, Mitsukoshi and Isetan integrated their managements under Isetan Mitsukoshi Holdings, creating Japan’s largest department store group in terms of annual sales.

am i going to see it?!?!

=P

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