A platform where you can design your own clothing and other items, and which also allows users to buy and sell items among their peers, UP-T is set to take the e-commerce world by storm.
Could you provide us with an overview of what exactly UP-T is, some of the services you provide through it, and your e-commerce strategy?
Initially, the UP-T service was launched in 2015 to provide original customer-designed T-shirts on demand. The goal was to deliver that kind of product to the customer in a three-day time frame. We first started focusing on T-shirts, but now we have since expanded to smartphone cases as well as other accessories and novelty goods.
The initial idea was for customers to design their own T-shirts for personal use, but we have further launched a system where you can actually sell your designs to other users. I would say that our first innovation was expanding to further product line-ups, and the second innovation was creating a platform where users can design T-shirts and then sell those designs to other users. For example, a T-shirt costs approximately JPY 2000, but a customer can sell their design, and imagine that design sells for JPY 3400. Now that the user is able to make JPY 1400 just from their design.
The third innovation for the service comes in the form of monozukuri, and through manufacturing technology, we have been able to introduce a 3D modeling system where you can see a product in 3D online. In April, we are launching a service that utilizes recent innovations in consumer-level 3D scanning technology. By taking multiple photos that cover 360 degrees of an object, you can scan that object in a 3D space, we are then able to print it using our 3D printing technology.
We have also teamed up with the Japanese comedy duo Kamaitachi to do a live show from the Budokan which is one of the biggest stadiums in Japan. We provided the duo with a T-shirt printing service.
One challenge facing the apparel industry is counterfeiting. How do you ensure that customers are not using your system to sell counterfeit products or designs that have already been copyrighted?
We do a visual inspection of all designs that come in from our clients. We call it the market inspection scheme and we check all designs thoroughly. In the past, we have had multiple requests for counterfeit designs, but within the terms of service, it states that customers requesting copyrighted material will be subject to bans. Since customers are aware of the bans, we now only have one or two submissions for copyrighted material per day. We also have a file-checking algorithm similar to YouTube. When you upload to YouTube, there is an automatic check for copyrighted material and users are alerted when the system discovers Digital Millennium Copyright Act (DMCA) infractions. We actively check both the market and the submissions we get in. If we do get any designs that we feel are suspect, we will hold those designs for further manual inspection.
Considering that you give your customers such freedom to design their own products, how do you ensure that the quality of each of these products is maintained?
Quality control is difficult, and the design sent in from a customer may not be the best quality. We have a system in place that will alert the user if they submit a low-resolution design. However, at the end of the day, it is up to the user to submit high-quality designs, and honestly, all we can do is warn them beforehand if the resolution of their design is low. For printed items, once in the factory, we have an AI inspection system that is augmented by human visual inspections.
The concept of people being able to customize their print designs on clothing has been around for many years, and even large brands offer these services in select stores. What makes the UP-T brand stand out when compared to these other alternatives out there?
Certain large brands have a limited number of items you can print on, but with UP-T, we actually have a choice of over 3,000 items for our customers. Our three-day delivery is also another core strong point of the brand, and if I’m correct, competitors’ products take five to seven days for delivery.
How are you able to achieve this three day delivery?
Our strength lies in our integrated product and sales system where we have developed our own production scheme. Currently, 97% of products are made in-house. I would say our biggest competition at this point is the Merch by Amazon brand, but at this point, they have only been able to produce T-shirts. Our products are very price competitive, with customers considering the price as very reasonable.
Customers can design merchandise for a whole range of products. Have any of these products seen recent growth or has the brand mostly seen sales in T-shirts?
Our sales leader is T-shirts. They have the most sales for the brand. Besides those, however, other items are also seeing growth. We have seen a rise in smartphone cases and we have a few dozen different styles for both android and iPhone. Miscellaneous goods have also seen recent growth.
Marui Orimono has other services as part of its digital portfolio, such as Michi Nail and the NIGAOE GRAPHICS. What are some of the synergies you have been able to generate among all of these digital services?
I think there is a synergetic effect in the sense that we have been able to accumulate our experience and know-how through our website operations. Michi Nail and other services have combined with UP-T, and we are now gathering more customers centered around UP-T. There are so many different items it is even hard for me to keep up.
We have an upcoming NFT service using the 1 million images that we have sold through our platform to users. That NFT platform will launch in March 2023, and I think this will create a lot of buzz around the UP-T brand.
Since we have good connections with Japanese celebrities, we are trying to use UP-T as a platform to do live-streaming. Things such as one-off fan signings and meetings are something we are interested in exploring. The live-streaming service was launched on the 25th of February 2023 and ran through an app that is launching that day.
UP-T was initially named after the concept of “uprising your emotions with T-shirts,” but we no longer only focus on T-shirts. The plan is to change our logo to a much simpler version to reflect our expanded focus. It should be on the website in the next few days.
When you export this service overseas, would you keep the current site or would you customize it to suit overseas markets?
As for the website, it is custom-made and tailored for each of the markets we are targeting. Basically, we have a Japanese version, an English version, a Korean version, and a Chinese version. The English-language version of the website will be launched in April 2023. In terms of English-speaking countries that we are targeting, we are looking optimistically at the US in particular. If you search the US market, you can usually order custom-made T-shirts for around USD 30-35, and we are able to provide our services for around JPY 3500-4000. Even if you account for the JPY 1000 in shipping costs, it ends up being slightly cheaper. What we are envisioning is direct export sales from Japan to the US.
For Korea and China, the pricing is similar, so we are now looking for celebrity agents in the locations that can help us establish direct sales from a factory in the location. Europe has strict restrictions on harmful substances, so currently, we are still in the process of getting approval from European governments.
As you can see, we have tailored our marketing strategy for each market. In the US, we are working with Google in terms of marketing, and I will personally be visiting the US on the 15th of February to discuss marketing a little further.
For our overall overseas strategy, we would like to start by focusing on the US market, and then further expand from there. What is interesting is that we have a marketing page on which users can sell their designs. Currently, this page is only offered to Japanese, but we want to open this up globally. Anybody should be able to access this page and order designs. I actually recently became aware of DeepL, and I am thinking we could possibly use their automatic translation neural network to translate back and forth from English to Japanese. By using automatic translation, Korean users can purchase designs from Americans and Japanese for example. We can enable the worldwide sharing and sale of original design work. This is the direction we are focused on right now.