DoCoMo expands its retail business into fashion with $22 million deal for Magaseek

NTT DoCoMo, Japan’s largest operator, has expanded its e-commerce business after announcing the acquisition of fashion-focused online retailer Magaseek for 2.04 billion yen (around $22 million).

The operator — which has around 50 percent market share in the country — announced a public tender offer for the startup back in January, and it has now picked up a majority 71 percent stake (15,105 shares). The deal will see Magaseek become a consolidated subsidiary of DoCoMo on March 21.

The announcement from DoCoMo explains that the new acquisition will help broaden its content offering, with a particular focus on female consumers:

Magaseek, one of Japan’s leading websites for fashion goods, has a considerable user base, mainly female customers in their 20s and 30s. DoCoMo expects to realize synergies in customer satisfaction and shopping convenience by linking Magaseek’s services with DoCoMo’s 60 million customers, cloud services and business expertise.

DoCoMo made a play for Web retail when it announced a new group strategy in 2011 and the operator runs its mobile-based ‘Dshopping’ service which lets smartphone and tablet owners buy items right from their device. After seeing initial traction, it is seeking to move into the lucrative fashion space in its native Japan.

MagaSeek was previously owned by trading firm Itochu. It recorded net profits of $1.5 million (138 million yen) on sales of $106.6 million (9,698 million yen) last year. DoCoMo previously said it would collaborate with Itochu on this proposed new service it is building through the acquisition.

DoCoMo’s efforts to increase its mobile content business have seen it invest $22.5 million in a joint venture with Chinese search giant Baidu, while it snapped up Italian content firm Buongiorno for $267 million in August 2012. It remains one of just a few first-world operators yet to strike a deal to carry the iPhone, though it has indicated its interest in an alliance with Apple. Without a deal, however, the carrier has built up its own content delivery platform and a number of other mobile-specific services.

Last year, it signaled its intention to up its focus on Japan with a new $125 million fund specifically for developing early-stage tech and mobile startups in the country. That program rolled out — with support from US-based 500 Startups — in February.

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