New Product Development

Give Rise to New Product Categories and Create New Markets

In our 2017 Medium-Term Business Plan, we state that we will go beyond the existing product categories to offer new value that benefits from technical advancements and responds to the change in driver demographics and the rising number of customers who are focused on value from experiences, rather than ownership of products.

Products that offer safety and peace of mind are one example. In December 2016, we introduced Pedal no Mihariban, a device we developed in collaboration with a manufacturer to prevent accidents caused by mistaking the accelerator for the brake. Sales of this product are rising steadily, particularly among older drivers, and we will move forward with the development of follow-on products. As car-related lifestyle products, we will also offer goods that use sophisticated design to brighten the mood of car interiors, products for camping and other leisure activities, gadgets that are useful in a car, at home, or away from home, and other items that bring a sense of enjoyment and richness to various types of occasions. Furthermore, with internet access from cars opening up a wide array of driving safety possibilities, and the potential to provide unprecedented information and convenience, we intend to develop new car electronics and IoT-related devices and services that harness these opportunities for customers.

In our stores, we will increase our use of displays providing concrete images of the benefits these products can bring, and incorporate the use of experiential events, to communicate compelling value to customers.

Japan’s First Car-Related Lifestyle Brand JACK&MARIE

AUTOBACS has established JACK&MARIE as a car-related lifestyle brand. With growing numbers of people turning to nature and valuing experiences, more and more attention is being paid to camping and the outdoors, surfing, undertaking do-it-yourself activities and the like. And though cars are often used on occasions such as these, no retailers had seriously set out to offer consumers car-related lifestyle goods and services. Seeing this untapped demand, we began to offer car-related lifestyle goods through the ZOZOTOWN shopping site in June 2017, and now we are planning to move forward with the establishment of a store in a shopping center known for its collection of popular retail shops. JACK&MARIE derivative brands, including JKM and GORDON MILLER, will be offered in AUTOBACS stores to enhance the attractiveness of these retail outlets.

Development of a New Market by Creating a New Product Category

Marketing from the Customer’s Perspective

Using Customer Feedback to Enhance Product Development and Service Quality

As a part of our “know our customers” initiative, we implemented the Customer Voice Program in October 2015 to use receipt barcodes to conduct surveys on what customers thought about the stores where they had shopped. Feedback was collected on a store-by-store basis, and action was taken to improve individual stores based on customer satisfaction ratings of face-to-face customer service, other services products, and the physical stores themselves. In addition, customer opinions will be analyzed and applied for purposes such as product development.

Establishment of a Joint Venture with CCC Marketing Co., Ltd. Market Development Using Data on Registered Customers of CCC Marketing and AUTOBACS

To increase our customer traffic, we joined with CCC Marketing Co., Ltd. to form a joint venture, ABT Marketing Co., Ltd., in March 2017. This new company will analyze combined data on 15 million AUTOBACS Maintenance Members and 60 million CCC Group T Point members to elicit optimal sales promotion approaches based on characteristics such as age, gender, residence, car model, and purchasing tendencies. It is expected that this work will enable AUTOBACS to efficiently develop new customers.

Strengthening of the Statutory Safety Inspections and Maintenance, and Automobile Purchase and Sales Businesses

Enhancement of Service Convenience and Added Value to Secure Stable Earnings

Statutory safety inspections must be performed on a regular basis and are a significant time and financial burden for customers. AUTOBACS, therefore, is enhancing its services in this area, with an emphasis on convenience and peace of mind. We are offering greater convenience by strengthening our online and telephone reservation service, performing 15-minute inspections to efficiently cover the legally required inspection items, and recommending post-inspection maintenance plans. Our Free Anshin 3-Star Repairs, which we began offering in July 2016, offers peace of mind. With this industry-first service, AUTOBACS Maintenance Members who bring their cars in for statutory safety inspections can receive free tire, window glass, and bumper repairs, up to a certain monetary value, during the year following the inspection. By combining warranties for repair work, with two years of free Maintenance Member status, which carries with it rights to receive 10 maintenance services at no charge, we are using ongoing peace mind following a statutory inspection to differentiate ourselves from the competition.

Turning to the automobile purchase business, which continues to grow, we aim to further strengthen our store-based purchase appraisals and boost customer awareness through ongoing television commercials to realize a whole new level of growth and enhance our profit margin. In addition, we will move forward with initiatives such as AUTOBACS store-based sales of vehicles purchased through our used car purchase stores, a new operation we are working to expand.

Development of New Business Formats

Conversion of Existing Stores to Ones Offering Lifestyle Goods and Services, and Development of Low-Cost, Special-Purpose Stores

AUTOBACS is presently moving ahead with the opening of stores manifesting a professional and friendly image. To begin with, we remodeled an existing AUTOBACS store to create AUTOBACS GARAGE FUCHU, an experimental store in Tokyo, in June 2017. Offering a much smaller line of products than found at traditional AUTOBACS stores, this new store, with its café-like interior, seeks to engender in customers a sense of joy and prosperity through themes such as “leisure outings,” “interiors & fragrances,” “smart & safe,” and “gadgets & sound.” Furthermore, for customers unfamiliar with the details of cars, we offer maintenance advice. In the case of tires, for example, we provide concrete suggestions regarding tire manufacturers, sizes, and replacement timing, and then provide the customer with a notification when replacement is necessary.

For customers living outside of metropolitan areas, we will open a new kind of store that features more focused product and service offerings and can be operated at low cost. The Smart+1 store we opened in Ibaraki City, Osaka Prefecture, in February 2017, for example, is the first of its kind. Featuring a manual car washing service at the entrance and members-only maintenance services, this store allows customers to have their cars washed and serviced by professionals on a reservation basis, while they relax in the store’s café. In addition to Smart+1 stores, we will also open AUTOBACS stores operating on a reservation-only basis, stores combined with gas stations, and stores specializing in statutory safety inspections, which will provide inspection estimates and reservation-only service.

Regarding e-commerce, our plans call for improving the AUTOBACS app, and revamping the AUTOBACS.COM e-commerce website to make it easier to understand and simpler to use. We will also strengthen connections to store-based reservation and installation services to further our omni-channel retailing efforts.

Expansion of Customer Contact Points through New Business Formats and E-commerce