2003 Reports

Putting e-commerce to work: The Japanese convenience store case

Rapp, William V.; Islam, Mazhar U.

Japanese convenience stores (CVS) are exploiting e- and m-commerce solutions different from, but relevant to, US practices. Seven-Eleven Japan, Lawson, and FamilyMart − three of the largest CVS − base their fundamental business models on increasing store traffic. Japanese reluctance to make credit card payments over the Internet or via telephones opened the way for CVS to provide third-party payment services, which required substantial IT infrastructure. Now they are leveraging this investment. In doing so, they are following a different e-commerce B2C model than is typical in the United States. Their approach incorporates heavy dependence on IT-based alliances (e-retsu), a range of services and products, and telematics (coupling detailed database management with the use of smart cell phones and sophisticated in-car communication and guidance systems) rather than PCs. This business-to-consumer (B2C) model is relevant to markets and market segments possessing similar characteristics.