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docomo Newsletter Mobility 39

WHY IS A MOBILE OPERATOR SELLING VEGETABLES?

— NTT DOCOMO created a buzz in 2012 when it acquired a controlling stake in Radishbo-ya, Japan’s premium home-delivery service for organic vegetables and preservative-free foods. But why would a mobile operator want to start serving vegetables? —

January. 25, 2013

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DOCOMO has a number of reasons for sinking its roots into the vegetable home-delivery business, a field yet to adopt mobile technologies. Its new partnership with organic foods retailer Radishbo-ya is sowing the seeds of a very promising harvest, one that customers will benefit from greatly.

By simplifying and automating procedures for registration, ordering and payments, DOCOMO expects to see sales jump among current customers who have been ordering by fax, and those who have yet to experience the convenience of mobile shopping for groceries.

The benefits for Radishbo-ya are equally tasty. Purchases by mobile devices via DOCOMO’s online shopping portal will enable marketing data to be easily collected and utilized for production optimization and promotion. Also, Radishbo-ya’s distribution systems will be enhanced with DOCOMO’s expertise in mobile solutions, such as fleet management. And, of course, Radishbo-ya looks forward to attracting customers from among DOCOMO’s 60 million subscribers.

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DIRECT SELLING

For DOCOMO, a major attraction of this new business is the opportunity to sell real items directly to customers via its “dmarket” online store (as “d shopping”) that currently sells digital content. Unlike typical mall-type portals where the operator receives rent-like commissions from mall tenants who sell their own products, the revenues from dmarket go straight into DOCOMO’s pockets, resulting in a much more bountiful harvest.

To generate more revenue streams via direct sales, DOCOMO has begun selling a wide assortment of items through dmarket. It is partnering with leading companies such as a TV home-shopping operator selling appliances and much more, a major drug store offering daily necessities. In total, DOCOMO now sells some 100,000 real items, separate from digital content, via dmarket.

Of course, direct sales require the seller to thoroughly understand its products. This is why DOCOMO is collaborating with leading retailers. But both sides also must clearly understand each other’s business. So, while DOCOMO had to pull on a pair of overalls and learn about organic farming, for example, Radishbo-ya sat down and opened up a few heavy technological books to study mobile marketing.

But such efforts are expected to pay off nicely. E-commerce, which includes the sales of dmarket, is forecast to generate 300 billion yen by FY2015, or about 7% of DOCOMO’s current revenues.

MAKING A DIFFERENCE … DAILY

Traditional operators build mobile highways that connect people. DOCOMO, an integrated services provider expanding into new businesses centered on mobility, has a much broader mission. Not only does it provide avenues of communication, it directly supports the everyday lives of customers with highly useful solutions for healthcare, environmental protection, entertainment, M2M and, yes, even grocery shopping!

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Mobility 39 (PDF format:1MB) January, 2013