Why do you buy from that e-commerce site?

E-commerce refers to transactions conducted via the internet, encompassing payments and sales. This series explores its current state and future through dialogues with leading figures across industries. In this first installment, Ryohei Mitsuhashi from Dentsu Inc.'s EC & System Solutions Department visits Hiroto Kobayashi, Representative Director and Chief Vision Officer (CVO) of Infobahn, which handles digital marketing and web operations. They discuss the rapidly evolving landscape surrounding e-commerce and media.

*Details of this conversation will also be featured later on " New Commerce Hub," a media platform exploring the future of e-commerce.

The Value of Information Provided by E-Commerce

Mitsuhashi: Mr. Kobayashi, you transitioned from being a magazine editor-in-chief to quickly becoming involved in content-driven web marketing and supporting companies in launching and operating their own media. How are you typically involved with e-commerce?

Kobayashi: At Infobahn Group, I've worked on supporting corporate digital branding and launching our own e-commerce site "Machiya ( http://machi-ya.jp/ )" as part of my duties. However, today I'd like to speak primarily as a user. Personally, I use e-commerce quite extensively. I also see significant potential in "content commerce" (a sales approach that provides valuable information to customers to spark interest in products and boost purchasing intent), which integrates content marketing with e-commerce.

Mitsuhashi: Lately, we've been getting many requests from Dentsu Inc. asking us to "create content suitable for e-commerce sites." Seeing how sites like Gizmodo Japan effectively drive traffic to e-commerce platforms makes me wonder, "This must be selling quite well...?" How are actual sales performing?

Kobayashi: We're pleased to hear that when our group's media introduces products, there's quite a positive response. Since user interest is high from the start, we feel that when our editorial team passionately discusses a product, we get a corresponding level of engagement.

Mitsuhashi: Today's consumers have a keen eye for discerning that, don't they?

Kobayashi: I definitely feel that. Recently, we've been able to measure changes in user attitudes after visiting the site numerically, so we're analyzing that too.

Mitsuhashi: From that perspective, e-commerce might be a tool for users to buy information rather than products.

Kobayashi: Exactly. I was really into military watches for a while. Back then, when I searched for military watch brands online, a certain e-commerce site came up. It didn't just list product specs; it explained which military forces adopted them and what made them superior. It really reminded me of the magazine "Mono Magazine," and I felt that was a prime example of content commerce in action.

Mitsuhashi: Wanting to buy from an expert who knows the product inside out is something everyone feels. How much in-depth information you can provide there becomes a key decision factor for buyers too.

The End of the Price Competition Era and Challenges Facing E-Commerce

Mitsuhashi: Personally, I feel Japanese e-commerce sites still don't place enough value on information that's enjoyable or useful to browse. Since Rakuten Ichiba launched in 1997, many sites seem to differentiate themselves solely through price differences. What challenges do you see in Japanese e-commerce, Kobayashi-san?

Kobayashi: Honestly, my impression is that the user experience is completely lacking. For example, imagine a user spots an appealing product at a department store. That user then searches for and purchases the product on an e-commerce site, meaning their visit to the physical store was solely to check the actual item.

Mitsuhashi: I definitely feel that too.

Kobayashi: To capture these "showrooming users" (consumers who visit physical stores to see and feel products but then buy them online for cheaper), the customer journey needs to seamlessly flow between online and offline.

For example, imagine I receive an email with content tailored to my interests, and I become interested in a product listed there. I might visit the physical store during lunch or after work to try it on, then make the purchase online. We need to consider this entire flow—what kind of user experience we should provide. This is fundamentally a business model issue. If we could integrate this entire user experience, encompassing not just e-commerce but also physical stores, across different organizations, it would be incredibly powerful...

Mitsuhashi: Organizational culture and structure certainly do hinder that kind of user experience.

Kobayashi: Even within the same organization, it becomes difficult if employees cling to their respective jurisdictions. I believe this challenge actually touches on the very structure of Japanese corporate organizations.

Mitsuhashi: That makes it a much larger challenge than just e-commerce. Where do you think we should start, Kobayashi?

Kobayashi: I think it's difficult to achieve within existing organizations. I believe the only way is to create a new vehicle and launch it as a new business.

Mitsuhashi: That's true. Breaking down the current Japanese organizational structure seems difficult.

Kobayashi: However, if an existing company aims to deliver a seamless user experience, I think it's a good idea to create a "customer journey map" (a model that visually represents, over time, the measures needed to meet customer needs and the resulting customer psychology) that crosses internal departments. Once you see which parts of the customer experience aren't working well, the focus naturally shifts to "how to solve those problems."

Mitsuhashi: At Dentsu Inc.'s EC & System Solutions Department, we also practice thoroughly mapping the customer journey and then implementing the necessary features on the site based on that. We believe it's crucial to provide not just individual user experiences, but also shared experiences between the company and its users.

Notable E-commerce Sites and Their Future

Mitsuhashi: Recently, various types of e-commerce sites have emerged. Are there any sites you're currently paying attention to, Kobayashi?

Kobayashi: I found the American content commerce site "Thrillist ( https://www.thrillist.com )" quite interesting. This site has the structure of a lifestyle magazine. When you read the content, you find articles like "There's pizza cake!" and they even include the actual recipes. At the same time, they feature and explain how to use noteworthy gadgets. At its core, it consistently maintains an attitude of "proposing a lifestyle," while only introducing products that resonate with them.

Mitsuhashi: So it's not just about listing products and leaving it at that.

Kobayashi: For example, if I were a shop clerk, I'd have to push products I didn't personally like to customers. But what's interesting about Thrillist is that it operates from a media perspective, suggesting "How about this lifestyle?" and then allowing you to actually purchase the products within the site. This feels like the future of content commerce to me, exciting for both sellers and buyers.

Mitsuhashi: So Thrillist is truly a fusion of e-commerce and media.

Kobayashi: In that sense, I think the line between e-commerce and media will gradually blur going forward. For example, the American company "Local Motors" takes on a kind of media-like form by providing a user experience – showing users the car development process in a theatrical way. Users can vote on cars proposed by designers and actually purchase them, so car manufacturing, media, and e-commerce are all integrated. Seeing such movements, I think the term "e-commerce" itself might disappear in the future.

Why Owned Media is Needed Now

Mitsuhashi: In recent years, many companies, including those engaged in e-commerce, have started launching owned media. Why do you think owned media has proliferated to this extent?

Kobayashi: I've been proposing the creation and operation of proprietary media to companies for over a decade, even before the term "owned media" existed. Back then, the response from others was lukewarm. But now, with the ability to capture audience data, more companies are recognizing the benefits of collecting data themselves rather than publishing articles on external platforms.

Also, with the recent availability of high-functionality yet open-source CMS platforms, creating media itself isn't particularly difficult anymore. This lowered barrier is likely another factor. Furthermore, since it's now possible to analyze social media sharing and other aspects, companies probably feel a sense of necessity and are starting to engage with owned media.

Mitsuhashi: I see. But with so many media outlets now, differentiation becomes crucial, right? What do you think is most important when launching a new owned media platform?

Kobayashi: That depends entirely on the type of site being launched, so there's no universal answer. However, to outcompete rivals, simply listing product specifications like before definitely won't cut it anymore.

For example, if you say, "This car navigation system can store tens of thousands of data points," consumers will just think, "Oh, okay." Companies launch owned media because they need to show their vision—how valuable the product is to consumers, or whether it truly enriches their lives. And content is what expresses that. In today's landscape where many offerings are similar, content commerce solves the problem of not being able to appeal solely through specs or price.

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[Editor's Note] A New Chapter in the E-Commerce Era

In recent years, buying and selling products online has rapidly become commonplace. Furthermore, it's now easy to check product reviews and word-of-mouth, or compare prices.

This shift in the landscape has led many retailers to focus solely on "selling products," often falling into price wars where they compete to be cheaper than the competition.

While physical stores offer the advantage of allowing customers to touch and see products firsthand and communicate directly with staff, the ability to promote products within a lifestyle or story and maintain ongoing communication is something uniquely possible in today's e-commerce landscape.

I believe that the key to success in e-commerce lies in thoroughly exploring how to provide product value combined with such "experiences" and "stories," and in maximizing the experiential value for customers.