Advances in retail technology are changing the way global automakers sell vehicles around the world. In Japan, where consumers rapidly embrace new technology, Toyota Motor Corp. uses a two-pronged approach that includes a Web site and a portal called Gazoo. Gazoo appeals to younger car buyers, who must register to become members and use the site for a variety of services. The approach is working, according to Toyota Executive Vice President Kosuke Yamamoto. Editor Edward Lapham interviewed Yamamoto in his Tokyo office on April 4. An edited transcript follows.
Are Toyota dealers in Japan involved in your e-commerce?
Toyota has 300 dealers and 5,000 sales outlets in Japan. And basically Toyota addresses B2C in two ways. The first way is the Toyota Motor Corp. Web site. The 300 dealers also have Web sites and home pages. These are interactive home pages, so the users can enter such information as what color and what kind of accessories they want in their car. And based on the information entered by the users, we can give suggestions as well as the price of the car that the users want.
Since our home page and the dealers' home pages are linked, users who come to Toyota's Web site are referred to the closest dealer.
So consumers cannot actually buy the car over the Internet. They are referred to a dealer?
Yes, the potential customer needs to physically visit the dealer. The price negotiation has to be done face to face. Also, here in Japan, the potential car owner needs a certificate from the police showing that he has a place to park the car. The dealers have to get that certificate. And there also are the questions of tax payment, financing and auto insurance as well as arrangements for required maintenance of the vehicle.
What is the other system for B2C?
The other is Gazoo. Gazoo is a membership club, and the Gazoo terminals or kiosks are placed in various parts of the country. The members can access Gazoo through the kiosks or terminals or through the Internet.
There are kiosks or terminals at the dealers or the sales outlets as well as the video rental shop called Tsutaya, which is like a Japanese Blockbuster Video, as well as at various convenience stores.
Such as at 7-Eleven stores or Lawson's?
Unfortunately, 7-Eleven is not part of this program. We have terminals or kiosks at Sankusand Circle K chain stores. There is a plan to expand this further, which would expand the Gazoo alliance to 13,000 outlets.
How many members does Gazoo have?
Gazoo has 500,000 members and is growing by approximately 2,000 per day.
What kind of content is on the site?
Gazoo provides information on new cars, used cars, repair and maintenance, insurance and financing. In the area of repair, if a viewer enters information into Gazoo about the damage of the car, including a photograph, the estimate of the repair cost would be calculated and shown to that user.
For used cars, you get the visual information. For financing, Gazoo shows the generic information because the specifics vary from dealer to dealer. So you have to go to the dealer to get the exact financing plan.
What about nonautomotive features?
One major feature is the Gazoo Mall, which currently has about 1,000 merchants or stores where the viewers can actually shop.
Using a credit card to purchase?
Yes. Since you can shop over the Internet, this is a very attractive feature and we believe that the number of merchants will continue to grow. Eventually, we would like to distribute music over Gazoo that can be downloaded; also, set up what we call the Gazoo plaza, where concerts could be held. Gazoo plaza is where people can have fun. Current membership is 500,000, but we expect this membership to grow to between 4 million to 5 million within four to five years.
Is there a charge for membership?
No. It's free. Members need to register their true names, but there is no membership fee. So you might want to join.
Is Gazoo bringing in younger buyers? Is it getting first-time buyers interested in Toyota?
Yes. We are making other efforts to attract younger buyers as well. Since last fall, we have launched several models that appeal to the younger customers.
Do you use special promotions for these new models on the Internet?
No.
How is traffic on your Web site and on Gazoo?
At our Toyota home page we receive 10 million hits per month, and many of those people are interested in knowing about the company itself.
What about requests for product information?
We are getting 1 million specific inquiries about specific models over Gazoo and another 1 million over our home page. That's well over 2 million hits all together. Of course, an overwhelming majority of those people who make the hits to Toyota home pages are the younger generation.
Do you surf the Net? What kinds of things do you like to do online? Do you buy things online? Have you bought a book or a sweater or ... ?
No. The most popular service of Gazoo currently is gift purchasing. The Gazoo Mall has a big gift purchasing service. For example, if the user asks a department store what kind of gift items it carries, the department store provides a full list of gifts that the user can choose from. The user clicks and enters the list of recipients of the gifts, and all those gifts are delivered. The younger people really like this feature.
In North America, young people like to buy music and videos and all sorts of things from sites such as Amazon.com. And there are trading sites, such as eBay, where individuals can go and can auction off things. Does Gazoo have something like that?
Not yet.
Autobytel and CarPoint have entered the Japanese market. What will Toyota do?
Toyota does not plan to form an alliance or partner with either Autobytel or CarPoint because we would like to interface with our customers through our own network. Otherwise, our customer information will go to Autobytel and CarPoint and we do not believe that would be in the best interest of our business.
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