Three

MARUI GROUP’s

BUSINESSAs a responsible member of society, MARUI GROUP takes steps to resolve social issues while improving­corporate value. Our approach to this task entails identifying the social issues to be addressed from thegenerate value that is greater than the sum of its constituents.

ourselves with comrades sharing our vision and to pool our strengths and generatesynergies as partners for co-creating a happier future. Our co-creative investment is
structured like a vinyl record, with an A-side and a B-side. The A-side is growth
support investment, where we invest in venture companies that share our philosophy and vision and with which we can collaborate. On this side, we conduct investments as a form of support for providing the resources that future generations, who

OIOI CO-

ID

value—the co-creation of creditability. By pursuing synergies through this business model, we aim toapproach, which targets investment returns and dividends. We rather seek to ally

IVE A- S

third pillar of co-creative investment along the prior pillars of retailing and fintech founded on our core

MARUI GROUP’s view of investment differs from the standard venture capital

EAT

holders. Efforts on this front going forward will be advanced under a new business model that includes the

Vinyl Record Structure with A-Side and B-SideCR­perspective of inclusion and working toward resolutions in our business through co-creation with stake-

CO-CREATIVEINVESTMENT

New Business Model Integrating Retailing,
FinTech, and Co-Creative Investment

Businesses

E

Co-Creation Ecosystem

Co-Creation Ecosystem [ Business ]will be both digital natives and sustainability natives, will need to commercialize their
passions. The B-side is investments that synergize with our main business. Here, weinvest in companies and new businesses entailing superior intangible assets andpursue collaboration to grow the earnings of our respective businesses while
resolving social issues.

Co-creative investment: An experimental venue for creating new future-changing
businesses based on MARUI GROUP’s existing business platform

MARUI GROUP views retailing as being more inclusive than the one-time transactional
relationships that end with the sale of a product in a store. In our retailing business, we
provide customers with experience value while forging ongoing relationships through a

Co-Creative Investment

diverse range of contact points formed via the provision of services that address cus-

A-side: Growth support investment

tomer concerns and issues. The greatest strength of our retailing business is our networkof 23 Marui and Modi stores that are visited by 200 million customers a year. We are

B-side: Investments that synergize
with main businesscurrently in the process of increasing our number of tenants that position stores not as
vessels for selling products but as venues for providing experience value and engaging
Yurakucho Maruiwith customers, such as D2C brands, content providers, and subscription service provid-

RETAILING

Physical Stores That Do Not Sell in the Post-Digital World

ers. We thereby aim to create stores that do not sell and are designed to provide value
unique to physical stores in the post-digital world. Brands with business models centeredon e-commerce are anticipated to be able to raise lifetime value by utilizing physicalstores as venues for engagement.

Retailing

FinTech23 physical storesMore than 7 million
EPOS cardholders

Reliability of MARUI brandCredit expertise

Annual visits by 200 million
customers

Stable financial base

Retailing staff

IT staff

FINTECH
Strategy of Maximizing Share of Household Finances for
Improving Lifetime ValueMARUI GROUP sees fintech as a means of promoting financial inclusion to provide
access to financial services, which were previously limited to wealthy individuals, toeveryone, regardless of their age or income, so that they can use the services they

Co-Creation Platformneed when they need them. This vision has inspired us to continue to practice theco-creation of creditability since our founding. Through this approach, we offer

Approximately 5,000 Group employees with a propensity for innovation and a capacity for empathy

younger people who still have low income credit cards with low credit limits andDirectly operated organizations encompassing everything from IT systems to distribution

proceed to build creditability with them as they continue to use their card and pay
their bills. Currently, our FinTech segment is advancing a strategy of maximizing its
share of household finances. Under this strategy, we provide services that allow
customers to use their EPOS cards to make payments for rent, utilities, and even
investment, which are usually performed through bank account transfers. The goal ofthis strategy is to improve lifetime value by increasing usage amounts while forging
long-term relationships with customers.

32

33

Co-Creation Ecosystem [ Business ]Co-Creative Investment Philosophy
Over the four-year period beginning with 2016, MARUI GROUP conducted a wide variety of growth investments.
These included investments for launching our anime and securities businesses, developing new businesses foraccommodating sharing economies, and financing sustainability and financial inclusion companies to further us

Retailing

Co-Creative
Investment

FinTechCreation of New Businesses
Aimed at Future Generations
Together with D2C Brands

Start of Co-Creative Investment
for Collaborating with Start-Up
Companies and D2C Brands

Collaboration with Co-Creative
Investees to Resolve Social Issues
and Grow Business

It is commonly thought that the retailingindustry is currently facing an exceptionallychallenging environment due to factors
such as population decline and sluggish
consumption. However, I do not agree.
I cannot deny that demand for mass
production and consumption of goods andservices will decline and conventional
retailing business models will cease to beeffective. Regardless, demand for personalized offerings that allow individuals to
express themselves is growing at anaccelerated rate among younger people.
I therefore feel that retailers can enjoy anincredibly prosperous future if they candevelop business models that respond to
this demand for living a fulfilling and happylife. A key ally in developing such a business model will be D2C brands. Whennegotiating store openings with Western
D2C brands, I was struck by how perfectly
they matched the sustainable worldview
that future generations are projected toembrace. Conversely, these brands lacked
experience in operating physical stores andoffering customer service as they primarily
operate online. MARUI is equipped to help
compensate for this deficiency. I am
confident that this partnership will beeffective for creating new businesses forserving future generations.

The co-creation ecosystem we target will
not be developed by MARUI GROUP alone.
Rather, we will build an ecosystem that
extends across society together with future
generations to help ensure the happinessof all stakeholders. Our business model
merging retailing, fintech, and co-creative
investment will be integral to the realizationof this ecosystem. Co-creative investment
in start-up companies and D2C brands is
a new pillar in this model alongside retailingand fintech. This form of investment
employs a model in which we pursue
synergies in our main business throughcollaboration with investees to grow aspartners. We have set the goal of investing¥30.0 billion in new business areas over theseven-year period leading up to the fiscal
year ending March 31, 2023. Smooth
progress is being made toward this goalwith total investments currently at ¥15.7
billion. Venture capital investments by othercompanies are generally aimed purely
at financial returns. MARUI GROUP’s
co-creative investments, meanwhile, arequite different in that they emphasize theextent to which we share the same visionand the feasibility of realizing this vision.
We invite all those interested to join handswith us in growing and evolving while
coordinating with MARUI GROUP’s retailingand fintech operations.

In collaboration with co-creative investees,
we believe it is important to focus on thegrowth of not only EPOS cards but also
new fintech businesses. We recognize that
we are collaborating with companies
engaged in cutting-edge initiatives basedon projected future trends. Even if the value
gained through this collaboration seems
small at first, we anticipate that it will growand blossom in the future. Through ourcollaboration with Minna-denryoku, forexample, we made application for renewable energy, something shown to be inhigh demand by EPOS cardholder surveys,
much easier by allowing customers toregister their card data for this purpose.
By effectively promoting this service,
we aim to help facilitate movements fordrawing attention to environmental issues
across Japan. These initiatives are not justaimed at contributing to society; we also
expect massive returns in terms of profit
as customers increasingly use their
EPOS cards to make various payments.
We will continue to develop services thatare highly convenient for customers going
forward from the perspective of resolvingsocial issues while growing our business.

Masahiro Aono

Masahisa Aoki

Yoshinori Saito

Senior Executive Officer
President and Representative Director, MARUI CO., LTD.
Director, AIM CREATE CO., LTD.

Director and Senior Executive Officer
General Manager, Co-Creative Investment Department
Director, D2C & Co. Inc.

Managing Executive Officer
In charge of FinTech BusinessPresident and Representative Director,
Epos Card Co., Ltd.
Director, MRI Co., Ltd.

toward our long-term vision. Among these investments, we at last successfully commenced co-creative investments
for financing and collaborating with venture companies after a rigorous process of investment for the purposes ofacquiring investment expertise, fostering necessary human resources, and laying other foundations.
In January 2020, we established D2C & Co. Inc. to facilitate full-fledged co-creative investments. This company iscoordinating with MARUI GROUP’s Co-Creative Investment Department to advance the development of a co-creation
ecosystem. The goal of co-creative investment goes beyond simple investment returns to target the generation ofsynergies with partners in co-creating a happier future. Investment candidates are selected based on criteria including vision feasibility, growth potential, and potential synergies.
Over the past four years, we have invested a total of ¥15.7 billion in new business domains. Of this, ¥7.1 billion was
directed toward investments in 20 venture companies. Calculated based on recent market prices, the internal rate of
return (IRR)*1 from these investments comes to 34%, despite the global COVID-19 pandemic, exceeding our internal
hurdle rate of 10%.
*1 Rate calculated using recent procurement prices for applicable marketable securities and based on amounts if listed stocks were to be sold at the end of therespective fiscal year

New Business Field Investments
Fiscal Year Ended March 31, 2020
tsumiki Co., Ltd.
D2C & Co. Inc.

20 Investees

Note: Figures represent rate of
growth from stock prices at timeof acquisition and at recent
procurement timing.

¥1.9 billion¥1.6 billion

4.5 times

More than 1.1 times

Venture companies

4 companies¥7.1 billion

Initial public offering on
September 20, 2019

7.5 times

More than 1.0 times

Funds

Initial public offering on
October 25, 201914 companies(As of May 21, 2020)¥5.1 billion
Less than 1.0 times

IRR 34%

Total ¥15.7 billion
Investment Statistics (Venture companies, etc.)

13 companies—— Number of venture company investees—— Amount of investments in venture companies—— Amount of other investments¥8.7 billion¥6.0 billion

4.9

6 companies

FY2017¥0.6 billion
FY2018Venture companies
Aggregate number ofventure company
investees

Aggregate investments in venturecompanies

2 companies

0.4¥15.7 billion

20 companies*2

3.3

1 company¥0.4 billion

Total aggregate
investments

0.4
0.2

2.7

FY20193.8¥7.1 billion

FY2020*2 As investments were conducted in the same companies in multiple years, the total number of companies invested in differs from the sum of companies from each fiscal year.

34

35

Co-Creation Ecosystem [ Business ]Co-Creative Investment

A

-

S

I

G R O W T H

DE

S U P P O R T

Growth support investment is conducted in venture companies that share MARUI GROUP’s philoso-

Investment

Tenant store opening

Employee secondment

Store locations: Shinjuku Marui Main Building

phy and vision and with which collaboration can be pursued. Investees are provided access to
MARUI GROUP’s resources, including its Marui and Modi stores, which are visited by 200 million
customers a year; its more than 7 million EPOS cardholders; and its seasoned retail staff. Arming
investees with these resources, we collaborate to drive their growth and heighten our returns.
Targets of these investments include e-commerce business operations, D2C brands, and financial
inclusion companies.

Japan Debut of Silicon Valley-Originating b8ta
Experience-Oriented Store
Established in San Francisco in 2015, b8ta (read “beta”) is an experienceoriented store that defines its mission as “retail designed for discovery.”To expand upon its store network, which previously comprised 23
stores in the United States and one in the United Arab Emirates, b8ta
opened two stores in Japan in August 2020, one in the Yurakucho Denki
Building and one in Shinjuku Marui Main Building. These stores employ
retail as a service business model with the aim of making retail moreeasily accessible to everyone. Partnering with b8ta, we hope to build theInvestment

b8ta Tokyo-Shinjuku Marui(located on first floor of Shinjuku Marui Main Building)At b8ta Tokyo-Shinjuku Marui, staff members receive direct training on all exhibited
products from the exhibitor prior to the start of sales to enable them to communicate
with customers based on a deeper understanding of these products. The store is staffedby eight individuals, six of whom are MARUI GROUP employees.

type of value that can only be provided by physical stores by injecting
MARUI GROUP’s resources.

Resources

VentureCompanies

Investment Returns

MAJOR INVESTEESTOPICS

Customer Behavioral Analyses Provided to Exhibitors

Exhibition Spaces Offered on a Subscription Basis

Numerous cameras and sensors have been installed at b8ta TokyoShinjuku Marui to analyze customer behavior. We are thereby able toprovide product exhibitors with information on the number of customers
that stop in front of certain products and the questions posed to staff
members for use in marketing and other strategies.

At b8ta Tokyo-Shinjuku Marui, 40cm × 60cm exhibition spaces are provided
on a subscription basis with contracts as short as six months. These
spaces are used to display gadgets, cosmetics, and other products from avariety of companies. Customers can even take these items in hand.

Establishment of D2C & Co. Inc.
MARUI GROUP established D2C & Co. Inc. in

MESSAGE FROM AN EMPLOYEE 

January 2020 to carry out co-creative investments.
This company will invest in and finance start-up

I have long had an interest in D2C brands and start-ups. I was therefore excited to volunteer to be among the initialcompanies developing D2C brands while capital-

staff members at b8ta Tokyo-Shinjuku Marui, the first store of its kind in Asia. The view of stores as sales floors

izing on MARUI GROUP’s resources to support thenecessarily leads one to focus on sales. In this store, however, we take the role of “b8ta testers,” and it is our job togrowth of these companies through means suchinternalize the passion exhibitors have poured into their products and communicate this to customers so that they can

as customer referral. D2C & Co. will also advance amake new discoveries and have new experiences. Customers’ responses to the products on display are varied, so I

variety of initiatives across D2C-related fields
spanning from physical store opening to operation.
MARUI GROUP hopes to develop a D2C ecosystem

work to collect data that cannot be extracted from the behavioral analyses performed by our cameras. The b8ta store
Press conference held on February 12, 2020

through these efforts.

provides an atmosphere that helps us remember the fundamental reason we enjoy shopping in a manner that is not
emotionally stressful as we spend time with our loved ones amid the COVID-19 pandemic. I think that experienceoriented, digital native stores like this show us the appeal that brick-and-mortar stores can have in the future.

Kumiko Tanabe
b8ta Tokyo-Shinjuku MaruiMARUI CO., LTD.

Please refer to D2C & Co.’s website for inquiries regarding investment
or store openings (Japanese only).
www.d2c.company/

36

37

Co-Creation Ecosystem [ Business ]Investment

Tenant store opening

Employee secondment

Investment

Store locations: Yurakucho Marui

Tenant store opening

Employee secondment

Store locations: Shinjuku Marui Main Building, Shibuya Modi,
Yurakucho Marui, Ikebukuro Marui, and Kobe Marui

Japan’s First Personalized Shampoo Brand
The D2C brand MEDULLA is the first brand in Japan to provide shampoo

Approximately 30,000 Combinations for Personalized Proposals

that can be personalized to address the concerns of individual cus­

By answering just nine questions on MEDULLA’s website, customers
can receive personalized proposals that select the products best forthem from among approximately 30,000 combinations. Formulations
are blended based on the individual customer’s needs and shipped tothem once every two months. This ease and the effectiveness of theseproducts have led subscription numbers to climb past 200,000 (as of
September 2020).

tomers, meaning that it can be customized to respond to the various
hair-related issues that can arise based on weather, lifestyle, or age.
A flagship store for this brand was opened in Yurakucho Marui in
December 2019, and we are examining the possibility of engaging
in EPOS card collaboration with this brand.

Made-to-Order Suits That Fit Your Life
Based on the concept of “Fit Your Life,” FABRIC TOKYO provides madeto-order suits that match customers not only in terms of size but also interms of their lifestyles and values. This company handles all aspects ofthis process spanning from taking customer measurements to production
at affiliated factories and sales. Apparel products have long been associated with the issue of mass waste. However, this issue can be addressed
through made-to-order options in which items are only made after anorder has been received. This sustainable approach resonates with

Personalized Coordination Support
Customers can visit FABRIC TOKYO stores at Shinjuku Marui Main Building and otherlocations to have their measurements taken by specialized coordinators with consideration paid to the characteristics of their body. These coordinators will also sit down withcustomers to discuss their concerns and the image they want to portray in order to offer
personalized coordination support matched to their lifestyles.

MARUI GROUP. Customer measurements are taken at FABRIC TOKYO’s
physical stores, and this size data can be used to order suits that perfectly fit each individual customer online.

Impeccable Quality at
Affordable Prices
Online, FABRIC TOKYO customers
are able to manage their favoritestyles and size data while also ordering clothing that perfectly fits theirbodies. In addition, FABRIC TOKYO
uses a factory-to-customer scheme
to directly link purchasers and­producers so that it can deliver­products with impeccable quality
at affordable prices.

Hair and Scalp Data from More Than 100,000 Customers

Content Experiences Unique to Physical Stores

MEDULLA’s ever-expanding lineup encompasses shampoo as well as awide range of other haircare products. This brand also offers custom hair
oil that is prepared based on hair diagnoses calling upon a database ofhair and scalp data collected from more than 100,000 customers.

Seeking to respond to customer demand to preview products and fragrances at stores,
MEDULLA opened an experience-oriented store in Yurakucho Marui. This store allows
customers to enjoy content experiences, such as scalp diagnosis and gift wrapping, thatcan only be offered at physical stores.

MESSAGE FROM A BUSINESS PARTNER 

Physical stores make it possible to solicit direct customer input that cannot be gained from the numerical data collected
via e-commerce venues. They also provide a valuable opportunity for customers that would have not encountered the
MEDULLA brand online to learn of us. I therefore see great potential for physical store openings. We see visits fromnumerous customers who want to undergo scalp diagnoses, preview the fragrance of our products, or experience ourbrand in some other way that is only possible offline. MARUI GROUP’s staff is incredibly understanding of D2C brands,

broadcasts from our store. In the future, I hope to expand our collaborative relationship beyond stores to include
personnel exchanges and joint business development in order to co-create the ideal form for D2C brands and ulti-

MESSAGE FROM AN EMPLOYEE FABRIC TOKYO is a D2C brand that was born on the internet. However, theIn the past, I had the opportunity to observe physical D2C brand storesproducts we deal in require professional skills to measure customer bodies

in the United States through MARUI GROUP’s overseas dispatch pro-and adjust to make an appealing silhouette. We therefore have to develop

gram, giving me a sense of the potential for stores that do not sell.

stores with facilities for this purpose. Our first forays into physical stores

I later volunteered to be seconded to FABRIC TOKYO based on the

took the form of the limited-time opening of a location in Yurakucho Marui.

belief that MARUI GROUP needed to change how it operated its stores.

This store proved ideal given that its location and customer base matched

FABRIC TOKYO has a corporate culture that aims to prevent situations in

our target demographic. We thus chose to expand our presence in Marui

which specific jobs can only be performed by certain people, translating

stores starting with Shinjuku Marui Main Building. We also felt that a 10%

often unspoken customer service techniques into words that anyone

discount for EPOS cardholders would be an appealing way to gain new

can understand. This has resulted in a high level of customer service

customers without discounting our brand. Sure enough, these discounts

proficiency among its staff. In the future, I hope to utilize my second-

have been making large contributions to the growth of our business.

ment experience to create physical stores that offer a sense of excite-

Furthermore, MARUI GROUP employees have been dispatched to work

ment without being bound by preconceptions.

deepen our understanding of each other’s business.

Yosuke Miyama
Representative Director
Sparty, Inc.

mately for digital native stores in Japan.

Junichi Mukai
Store Development Specialist
FABRIC TOKYO Inc.

38

FABRIC TOKYO cuts out intermediary distributors to form direct relationships withall of its affiliated producers with respect for openness and transparent traceability.
These relationships allow it to make information on production sites and distribution
openly available.

together on our projects, and this has proven to be a good opportunity toand they have supported us in a variety of ways. This is why we chose to set up shop in one of MARUI GROUP’s stores.
Their service is fast and courteous, even in the midst of the COVID-19 pandemic, and they even helped us set up live

MESSAGE FROM A BUSINESS PARTNER 

Commitment to Quality Transmitted to the Future

Yusuke Iwamoto
Seconded to FABRIC TOKYO Inc.
MARUI CO., LTD.
(As of August 2020)

39

D

DIALOGUE 02

Potential of D2C Brands as an Ecosystem
Direct-to-consumer (D2C) brands are brands that employ a new business model of forming relationships directly with
consumers, via a directly operated e-commerce website or social media, without going through a retailer.
MARUI GROUP looks to support D2C start-up companies and develop a D2C ecosystem. D2C & Co. Inc. was established in
January 2020 for this purpose. D2C brand operator Yuichiro Mori, who has opened physical stores for his brand at Maruistores, joined MARUI GROUP’s Hirotsugu Kato for a discussion on the potential of D2C brands as an ecosystem.

Lack of Visibility of Brands Dependent Solely on
E-Commerce

are founded less on the quality of their products and more on
how much customers enjoy the overall experience of the brands,
including their creative vision, the experience of purchasing

40

Kato: We first met, Mr. Mori, around three years ago if I recall

items, and the sense of community they offer. I started a D2C

correctly. I still remember how much everyone seemed to be

fashion brand with the goal of creating a business model thatenjoying their work when I visited your office. Despite this light-

combined my love of fashion with IT.

hearted atmosphere, questions about work were met with

Kato: People who have been involved in traditional retailingdetailed, data-driven explanations using computer screens. I was

operations tend to be highly conscious of sales targets. This

shocked and amazed to get such a response from a start-up

consciousness often leads to interactions with customers

company. What made you think about launching your own

ending in one-time transactions, and it can be quite difficult

business?

to shift to a perspective focusing on long-term relationships.

Mori: I have always loved fashion. When I was at university,

I understand that you, Mr. Mori, keep up-to-date on your custom-

I started up a fashion media outlet and even went to see fashion

ers. It is amazing how much a difference effective quantitativecollection presentations in Paris and Milan. I believe that fashion

analysis can make in the value of stores.

has the power to fill you with positivity when you wear an outfit

Mori: When I was at a real estate venture company, I learned

or items that you particularly like. Entering into the fashionthat encouraging existing customers to continue to live in our

industry after university, however, I felt that the industry wasproperties was a better path to consistent earnings than trying

too tied up in past success stories, and was thus behind theto secure large numbers of new customers. Today, we refer totimes. I had previously thought that fashion was about propos-

this idea with the term “lifetime value.” If customers continue toing something new, so this experience was incredibly disheart­buy our products over the decades to come, they will continue

ening. Lost in this despair, I saw a new light in the IT industry andto shape our brand over the long term. You could even say thatin venture companies and start-ups. I later took part in the early

I embraced the concept of unit economics right from the startdays of a real estate venture company and the marketplaceof FABRIC TOKYO.

app operator Mercari, Inc. This experience made me realize that

Kato: Our ultimate goal is to make stores that do not sell. D2C

I was more suited to the management style of start-ups, but I

brands like FABRIC TOKYO will be a core part of accomplishing

still couldn’t shake my attachment to fashion.

this goal. As D2C brands can sell their product directly to cus-

Kato: During the bubble period, we were developing a businesstomers through the internet, what value do you gain from physi-

centered on fashion, which proved incredibly popular at the time.

cal stores?

After that, however, we fell into a long period of stagnancy. I think

Mori: Physical stores are a venue for soliciting the creative vision

our preoccupation with past successes was one reason for thisof our brand and for allowing prospective customers to experi-fall. During this time, customer surveys brought scathing opin-

ence our brand. They also serve a function similar to a media

ions, like how our stores were unsettling as they had nothing but

outlet. If we depend solely on e-commerce sites, we lack vis-clothes and how our customer service approach was a bit

ibility, like opening a store in the middle of the desert. Physicalintimidating.

stores, meanwhile, are a part of customers’ everyday lives,

Mori: Apparently, my father bought his first suit at Marui, andmaking it much easier for customers to find us in them. Also,

I too strongly associated Marui stores with fashion. D2C brands

online advertising fees are skyrocketing. Accordingly, if we areare garnering attention at the moment. I feel that these brands

able to make good use of both online and offline venues, we can

YUICHIRO MORI × HIROTSUGU KATO
Yuichiro Mori

Hirotsugu Kato

CEO/Founder
FABRIC TOKYO Inc.

Director, Managing Executive Officer, and CFOMARUI GROUP CO., LTD.
President and Representative Director, D2C & Co. Inc.

41

D

DIALOGUE 02

D2C brands can provide their products on a nationwide or evenglobal basis. Even niche brands can thus attract tens of thousandsof customers if they grow their customer base on a global scale.
This potential is one of the appeals of D2C brands.
Yuichiro Mori
CEO/Founder
FABRIC TOKYO Inc.
Born in Okayama Prefecture in 1986, Yuichiro Mori joined fashion event production company DRUMCAN inc.
after graduating from university, where he took part in the planning and production of fashion shows and events.
He later began joining venture companies, being involved in the early days of real estate venture Global Agentsand the launch of the Mercari marketplace app. He used this experience to start up the FABRIC TOKYO (formerly
LaFabric) made-to-order business wear brand in February 2014. Through FABRIC TOKYO, Mori aims to provide
customers with suits that perfectly fit not just their bodies but also their lifestyles. FABRIC TOKYO stores can befound across Japan in locations such as Shinjuku Marui Main Building and Kobe Marui.

increasingly embrace such brands. It is also likely that we will

nesses that address social issues. Could it be that the relative

see an increase in the number of young people that aspire to set

youth of their management is related to this high level of issue

up their own D2C brand.

awareness?

Mori: To increase such brands, we will need a healthy D2C

Mori: That might be a factor. My generation witnessed a number

ecosystem. Creating this system will require ambitious entrepre-of serious issues, including massive natural disasters, terrorist

neurs followed by employees and other team members andattacks, and the 2008 financial crisis, over the span of only twoeventually partner companies. When all of the necessary man-or three years. This experience could have sparked our aware-agement resources have been acquired, including people, sup-ness of such issues. People often talk of three types of value, butplies, money, and information, we will see the growth of quality

it would appear that this used to be two types: value for custom-businesses and quality brands. D2C & Co. will have an incredibly

ers and value for business. The third type of value is new. This isimportant role to play in this ecosystem, and I truly hope that thisvalue for society. The idea of developing a business targeting thecompany will come to be a leading force in the industry.

intersection between these three types of values is commonly

Kato: I too hope to work together with you, Mr. Mori, to build ashared among younger entrepreneurs.

co-creation ecosystem that includes D2C brands and contribute

Kato: MARUI GROUP seeks to provide value that is shared by all

to society through this process.

attract customers more affordably. I also like to use physical

Kato: That shows just how popular the FABRIC TOKYO brand is.

stakeholders. In 2019, we newly identified future generations as

Mori: D2C brands can provide their products on a nationwide orstores as a testing ground for new ideas before we implement

What do you think inspires customers to become fans of

the sixth group of stakeholders to which we aim to provide thiseven global basis. Even niche brands can thus attract tens ofthem on our e-commerce site.

FABRIC TOKYO?

value. Viewing future generations as stakeholders means thatthousands of customers if they grow their customer base on a

Kato: I think a lot of people would be surprised to hear what you

Mori: We don’t refer to our customers as “fans”; we call them

we have to consider environmental and food issues in our

global scale. This potential is one of the appeals of D2C brands.

just said, as it is commonly believed that attracting customers

loyal customers. This is because it’s tough for fans to stay fans­business. This has naturally led us to practice sustainability

via the internet is cheaper. I want to spread understanding of

forever. We recognized the danger this truth represents, and thus

management.

such value to be gained from physical stores and to see otherstarted taking steps to monitor customer loyalty. We also value

Mori: That is quite admirable. I guess it was that thinking that led

D2C brands set up more locations in our stores.

our concept of “Fit Your Life” above all else. By this, we mean

MARUI GROUP to invest in and collaborate with a sustainable

that we want our suits to fit customers’ lifestyles as well as theirpower producer.

Consistent Sales During State of Emergency,
Record Performance Thereafter

bodies. This concept is the common thread running throughout
our website, store, and organizational measures. In fact, we
often hear people raising the question “But does that ‘Fit Your

Kato: We had to close our stores for nearly two months due toGrowth of Quality Business and Brands After
Acquisition of Necessary Management Resources

Life’?” at meetings.
Kato: Many say that D2C brands are unlikely to show significant

the COVID-19 pandemic. This is the first time stores have been

Sustainability of the Made-to-Order Model

growth in terms of quantity. What factors do you think need tosites in the United States doubled as a result of the pandemic.

Kato: The concept of “Fit Your Life” is important to personaliza-

come along that eliminated the issues faced by customers,

Mori: We too had to close our physical stores, which put a halttion, and personalization is in turn crucial to sustainability. A

would it grow?

on the acquisition of new customers. Luckily though, existingrather shocking data point from the apparel industry is that

Mori: We are only looking at the tip of the iceberg when it comes

customers continued to buy our products through our e-com-

roughly half of what is made is not sold. That creates a lot

to D2C brands. These brands are currently in their infancy, andmerce site, and sales actually did not decline as a result. That isof waste.

there are a lot more stages for them to go through their develop-

one of the advantages of a D2C brand. For us, the number of

Mori: That is one of the reasons we adopted the made-to-orderment. Those brands that are able to formulate a clear vision forusers with registered measurement data is our most importantmodel. We are keenly aware of manufacturing-related issues,

the future stages of their development will likely be the market

key performance indicator. We were able to post a record-break-

and we have thus defined technology, sustainability, and trace-

leaders of the future. FABRIC TOKYO’s goal is to join the top 10

ing performance with regard to this indicator in the last week ofability as principles positioned under our concept of “Fit Yourapparel companies within the next decade. I have the utmost

July 2020, after stores were reopened following the lifting ofLife.” In Japan, around 280,000 suits are put on the market every

confidence in our ability to accomplish this goal. After all, theJapan’s state of emergency declaration. Size is more important

year, but only 130,000 of these were sold in 2019. Plus, 10% of

products that see growth are those that are used every day andfor business suits than it is for other forms of clothing. We havethe world’s CO2 and 20% of its wastewater are emitted by thetransform customer lifestyles, such as clothing, furniture, home

thus seen a rise in demand for the option we provide to purchaseapparel industry. This industry is polluting the earth to makeelectronics, food, and cosmetics.

made-to-order suits online, causing customers to flock to our

products that it throws away. Our made-to-order model, mean-

Kato: The use of D2C brands is common among a younger

physical stores.

while, is sustainable as we only make the products for which

demographic in the United States, and it can thus be assumed

we receive orders.

that millennials and younger generations in Japan will come toclosed for this long since World War II. Was FABRIC TOKYO affected by the pandemic? I heard that the growth of e-commerce42

Kato: It seems to me that a lot of start-up companies run busi-

happen for D2C brands to grow in the future? If a brand were to

Viewing future generations as stakeholders
means that we have to consider environmental
and food issues in our business. This has
naturally led us to practice sustainability
management.
Hirotsugu Kato

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Co-Creation Ecosystem [ Business ]Co-Creative Investment

B
S

Y

S
N

I

E

R

D
G

E

I

Z

E

Investments that synergize with our main business are defined as investments in companies and new
businesses that entail superior intangible assets. Through these investments, we aim to incorporate
the unique expertise and other intangible assets of these companies into MARUI GROUP while generating synergies by means of collaboration to grow the earnings of our main business. In cases inwhich we can expect synergies with our main business, we will invest in venture companies not
anticipated to make initial public offerings or in listed companies. This was the case with the anime
business launched in the fiscal year ended March 31, 2016. We also invest in sustainability companies
as well as in new businesses, such as the securities business of tsumiki Co., Ltd.

Investment

Pocket Marche offers a direct distribution platform that allows consumers topurchase ingredients directly from farmers and fishermen. This platform
communicates not only the appeal of the items being offered but also thestories of their producers, providing consumers with the option to makepurchases based on their values or a story they found particularly compellingwhile also emphasizing the value of direct communication between products
and consumers. Through its business and capital alliance with this company,
MARUI GROUP is examining possible initiatives for creating new value
including in-store events and benefits for EPOS cardholders as it works tocreate new experience value.

Investments

Synergies

Resources

Resources

Investees
New Businesses

Earnings Contributions to
Main Business

Investment

New business development

Shaping spaces through a combination of design, business, and technology
is the business of TSUKURUBA Inc. Specific aspects of this business include
providing living proposals matched to customers’ individuality throughdevelopment of offices for start-up and IT companies and the cowcamo
service that lets users find their one-of-a-kind dream home from among alimited selection of secondhand and renovated properties. As our first collaborative venture, we will jointly develop a renovated rental condominium
brand by pooling our resources and expertise. Through this collaboration,
MARUI GROUP aims to ramp up its efforts in the area of housing, where we
expect to be able to improve lifetime value through long-term relationships
with customers.

MAJOR INVESTEES
外国人が日本に来てよかったをカタチに ®

TOPICSFirst B-Side Song—Anime Business
MARUI GROUP established the Anime Business
Department in April 2016 to create a new businessfor contributing to earnings in our main business by

MESSAGE FROM A BUSINESS PARTNER 

facilitating the growth of our retailing and fintech
businesses. Over the four-year period encompassing the fiscal years ended March 31, 2016–2020,

ONE PIECE EPOS CARD
©Eiichiro Oda/Shueisha, Toei Animation License
coordinated by FUNimation® Productions, Ltd.

Began issuing BanG Dream! Girls
Band Party! EPOS CARD
©BanG Dream! Project ©Craft Egg Inc.
©bushiroad All Rights Reserved.

At TSUKURUBA, co-creation has been an important theme in our corporate culture and in our business since the timeof our founding. When looking for partners, we became aware of MARUI GROUP’s co-creation management philoso-

we have invested a total of ¥120 million in anime

phy. Recognizing that this philosophy resonated with our own, we decided to join hands. It has been a number of years

movies. These investments have generated signifi-

since the emergence of the buzzword “open innovation,” but there are still only a few cases of true success in open

cant returns in the forms of synergies with our main

innovation. Success in open innovation requires ongoing commitment, in both rhetoric and action, until it becomes anbusiness and contributions to consolidated operating income totaling ¥4.3 billion.

unwritten part of a company’s corporate credo. This is, of course, easier said than done. Meanwhile, I see co-creation
Sumikkogurashi EPOS CARDGODZILLA EPOS CARD

©2019 San-X Co., Ltd. All Rights Reserved.

TM&©TOHO CO., LTD.

as an effective method of maximizing the value we provide to consumers and to society. The goal I envision for ourpartnership with MARUI GROUP is the maximization of the experience value we offer the consumers that are ourcustomers. This partnership will begin with the development of a renovated rental condominium brand. We will take a

Hiroki Murakami
CEOTSUKURUBA Inc.

broad perspective with regard to this initiative, seeking to evolve the experiences offered in the rental housing field toinclude digital experiences. I pledged with President Aoi to create an example of successful open innovation in Japan,
and I am absolutely committed to ensuring the success of this undertaking.

44

45

Co-Creation Ecosystem [ Business ]MARUI GROUP is pursuing synergies with its main business throughco-creation in forms other than co-creative investment.
New Global Marketplace for Creating New ValueiKASA
Investment“I want to circulate our limited resources to help society thrive.” The
Mercari marketplace app was born out of this realization by the founder

Employee secondmentof Mercari, Inc., as he traveled the world. This company aspires toharness the power of technology to make it easy for people around the

Nature Innovation Group Co., Ltd. is developing iKASA Japan’s first umbrella
sharing service. With iKASA, there is no need to rush to buy an umbrella in theevent of sudden rainfall; customers can rent one for 24 hours for only ¥70 andthen return it to the most convenient location, keeping them safe and dry fromthe rain. The iKASA service is being developed as a piece of infrastructure for
ensuring mobility on rainy days by eliminating the restrictions placed on
movement if one does not have an umbrella while freeing them from thediscomfort of getting wet. This service also contributes to the sustainabilityof society by reducing the number of plastic umbrellas that are purchased andpromptly thrown away. We are steadily introducing the iKASA service at Maruiand Modi stores across Japan while engaging in other collaborative ventureswith Nature Innovation Group.

world to link up and enjoy the experience of buying and selling with each
Service coordination

Operation contracting

Store locations: Shinjuku Marui Main Building

Easy and Convenient Shipping Using
Unmanned “Mailboxes”

New business development

Life is Tech, Inc. offers Life is Tech ! , one of Japan’s largest IT education­programs for junior high school and high school students. This program isdesigned to foster creativity and allow students to learn about technologies
for creation through the study of app development and other programming
disciplines as well as cutting-edge technologies such as digital art. MARUIGROUP has formed a business and capital alliance with this company throughwhich we aim to jointly create new businesses with an eye to future generations. Our participation is taking the form of support from employees for giving
form to the ideas of students as we accelerate new business development andother co-creation activities. Life is Tech, Inc. is capitalizing on its expertise tocontribute through overall planning, student recruitment, and mentoring tofurther expand co-creation activities oriented toward future generations.

First Physical Mercari Station Location
In June 2020, Mercari, Inc., opened its first physical Mercari Station location in Shinjuku
Marui Main Building. This shop offers offline experiences and services centered on digitaltechnologies, making it highly compatible with MARUI GROUP’s store development
strategies. Mercari, Inc., has also set up a Mercari Station at the LaLa terrace
MUSASHIKOSUGI shopping center (not associated with MARUI GROUP). Operation ofboth of these locations is outsourced to MARUI GROUP employees.

MESSAGE FROM A BUSINESS PARTNER 
Customers visiting Mercari Station include both existing Mercari users

survey results have shown impressive satisfaction rates of nearly 90%.
Customers who thought the Mercari app would be a hassle haveexpressed that their visit made them see how simple the app was andthat they now want to list an item. MARUI GROUP provides us withsupport for operating our store while also proposing methods of recruiting customers and improving operating practices. Mercari Station
Employee secondment

Collaboration cards

Store locations: Shinjuku Marui Annex, Marui City Yokohama, Hakata MaruiA-too inc. operates Suruga-Ya, a major e-commerce website specializing in secondhand
hobby items centered on plastic models, figures, and other anime merchandise. Together
with this company, we launched the SURUGAYA EPOS CARD in 2020. Moreover, A-too
has opened Suruga-Ya stores in Marui stores. These stores see higher visitation fromfemale customers than A-too’s directly operated e-commerce site or physical locationsin other stores. These locations are thus helping this company make contact with a newgroup of customers. We have also launched a new service in which shipments of items
that customers wish to sell can be conducted at dedicated service counters in Marui andModi stores. This option was previously only available through standard courier services
or at Suruga-Ya locations. In the future, we look forward to further improving customer
experiences through collaborative initiatives that take advantage of our stores and the
distribution networks of subsidiary MOVING CO., LTD.

46

the Mercari experience while also making the app more familiar andMercari, Inc., holds Mercari Workshops to teachpeople how to use the Mercari app. At theseworkshops, instructors guide students throughthe experience of finding and purchasing
products and of listing unneeded items for sale
while also teaching them other ways to enjoy
Mercari. Support is also offered for sellers in such
ways as booths for photographing products andconsultation.

are all ages and even come from locations outside of Tokyo. Post-visit

Tenant store opening

points to allow prospective sellers with no previous experience to try out

Venue for Enjoying Learning About andExperiencing Mercari

and individuals who have yet to experience the app. These customers

Investment

other. Mercari, Inc., is expanding its range of online and offline touch

convenient for current users.

Investment

MARUI GROUP wants to hear revolutionary ideas for changing the futurefrom university and graduate school students. Application is open until
mid-November 2020 (Japanese only).
www.0101maruigroup.co.jp/future/

Tenant store opening

provides numerous opportunities for making contact with customers,
through Mercari experiences, workshops, events, and live broadcasts.
Through this venue, we hope to communicate the appeal of the Mercari

Mercari Post, an unmanned “mailbox” that allows
sellers to ship sold items simply by droppingthem in one of these boxes. These easy andconvenient shipping kiosks provide services
ranging from automated shipping label preparation to shipping. They are particularly appealing
as sellers can perform all processes leading up
to shipments while receiving support from staff
members by just bringing in the sold items.

MESSAGE FROM AN EMPLOYEE 
Our co-creation activities with Mercari, Inc., match up with MARUI GROUP’s
vision for digital native stores and stores that do not sell. We provide
Mercari, Inc., with store operation expertise and employees skilled incustomer service as well as a venue for allowing customers to experience the Mercari app. This venue helps to enhance this company’s
offline customer contact points and to increase engagement with Mercari.
Those of us who have been entrusted to staff Mercari Station go about
operating the store while emphasizing the importance of both customers
and the needs of Mercari, Inc. We also realize that trust is indispensable
to long-term co-creation partnerships. During the Mercari experiences
offered at Mercari Station, we frequently see customers form a naturalconnection and begin to teach one another, making us aware of theGroup and increase our fan base.

potential for this store to foster a sense of community. In my own capac-

Yukiko Ohdo

tinue to be used for three decades.

ity, I hope to help develop a new model for Marui stores that will con-Business Development OMO & mercari Station Manager
Mercari, Inc.

Ryo MatsumotoMore details can be found on the following website (Japanese only).
www.to-mare.com/news/2020/post-3.html

Mercari Station
Shinjuku Marui Main Building
MARUI CO., LTD.

47

Co-Creation Ecosystem [ Business ]Provision of options enabling all people tobe themselves and experience happiness

MARUI GROUP’s Value Journey ofContinuous Co-Creation of Creditability

Conversion to renewableenergy for household
electricity to support the
future of the earth

Green Businesses

Investment starting at
young age to alleviate
concerns regarding
resources for the future

Touchpoints with customers

Conclusion of rent
contracts using rent
guarantee services
through EPOS card
Consolidation ofhousehold financepayments by using EPOS
card as main credit card
Receipt of EPOS card as
first credit card after
recommendationin store

Lifelong Relations

Asset Building Services

with Customers

Visits to Marui and Modi stores,
product purchases and experience value

Rent Guarantee Services

Subscription Services

EPOS Cards

Marui and Modi Stores
Duration of relationships with customers

Ongoing Relationships as Opposed to One-Time Transactions

Lifelong Relations

Rather than one-time interactions that end with a single transaction, we seek to foster ongoing

MARUI GROUP joins hands with customers that resonate with a sustain-

relationships with customers by providing experience value and diverse services in stores.

able mind-set, thinking of one’s future self and of future generations, toThese long-term relationships enable us to practice the co-creation of creditability.

co-create a happier society.

Spirit Continuing from Installment Payments at Time of Founding Seen in Co-Creation of Creditability
debts in 10, 12, or 24 installments after purchases. So long as

MARUI GROUP is increasing its diverse lineup of services cen-

Looking ahead, we will encourage customers that resonate withthrough monthly installment payments. Furniture in those days

customers made payments on time, they would continue to build

tered on EPOS cards as well as subscription services that are

our sustainability-based mind-set to partake of services such as

was exceptionally expensive. We helped customers make suchcreditability the more they borrowed and the longer the period

not dependent on selling goods in order to foster even longer-

switching to renewable sources for their household electricity in

expensive purchases by loaning money for the purchase toover which they borrowed. The services we offer customers haveterm relationships with customers. Rent guarantee and asset

order to contribute to the resolution of social issues while bol-customers, which they would repay in monthly installments.

changed with the times. Regardless, we have continued tobuilding services, for example, entail recurring transactions withstering medium-to-long-term profits. We thereby aim to build aCompared to business models based on cash payments, which

practice the co-creation of creditability throughout the years bycustomers over the course of long-term relationships that can

co-creation ecosystem that extends across society together withoften resulted in relationships ending after a single interaction,

mutually building creditability with customers based on theirlast 5, 10, or even 20 or more years. These services thereby

our six groups of stakeholders, including future generations, andinstallment payments were effective in fostering long-term

usage histories.

encourage customers to use EPOS cards as their main cards

help shape a happier future.

relationships with customers as they proceeded to repay their48

Co-Creation Ecosystem Built on Long-Term Relationships

MARUI GROUP’s business initially involved selling furnitureand contribute to increases in Gold and Platinum cardholders.

49