Eight Keywords for Delving Into Mercari: Our First 10 Years and the Potential and Future We Seek to Unleash / The Fifth Keyword: “Purpose”

February 2023 marked the tenth anniversary of Mercari, Inc. We now have a new Group mission of “Circulate all forms of value to unleash the potential in all people.”

February 2023 marked the tenth anniversary of Mercari, Inc. We now have a new Group mission of “Circulate all forms of value to unleash the potential in all people.”

Here at Mercan, we have kicked off a new series feature called “Eight Keywords for Delving Into Mercari: Our First 10 Years and the Potential and Future We Seek to Unleash,” where we shine the spotlight on the thoughts and dreams put into this new Group mission and what we intend to achieve in the future. We will hear from key people who will lead Mercari into its next era, and try to paint a picture of the present and future of the organization that is Mercari to help us imagine how we can contribute to the company in the coming ten years.

For the fifth article of this series, the keyword is “purpose.” To discuss Mercari’s purpose, we spoke with Shuji Kawano (@shuji; Senior Vice President of Management Strategy at Mercari), Sayaka Eda (@Sayaka; Senior Vice President & CFO at Mercari), and Makiko Shinoda (@shinomaki; Outside Director (independent director) at Mercari). Join us as we delve into the ideal relationship between society, users, and Mercari members, and what is expected of Mercari as a public entity.

Featured in this article

  • Shuji Kawano

    After graduating from the Waseda University Faculty of Science and Engineering, Shuji began working at a joint investment fund between Livedoor’s investment bank division, Goldman Sachs Securities, and SBI Holdings. Then, he joined Industrial Growth Platform, Inc. (IGPI), a strategy consulting company. After that, he started his own business. In July 2018, with the experience of helping a startup company get listed under his belt, Shuji became Vice President and head of the Management Strategy Office. In September 2020, he was appointed to his current position of Senior Vice President of Management Strategy.

  • Sayaka Eda

    Sayaka completed her pre-doctoral course (master’s degree) at the Graduate School of Science and Engineering from Keio University Graduate School. In April 2006, she joined Goldman Sachs Japan Co., Ltd. After joining the company, she was engaged in investment/loan projects that utilize their own funds, etc., and was appointed as a Managing Director at the same company in 2017 based on her extensive financial knowledge outside of corporate finance. Outside of her work, she also serves as the Co-Chair of the Japan Women’s Network and leads the promotion of D&I. Sayaka became CFO in January 2021, later taking on the additional role of VP of Corporate in July 2022. Since January 2023, she has been in her current position as SVP of Corporate and CFO.

  • Makiko Shinoda

    After graduating from Keio University, Makiko Shinoda joined the Long-Term Credit Bank of Japan (currently Shinsei Bank). She received an MBA from the Wharton School of the University of Pennsylvania, and an M.A in International Relations from Johns Hopkins University, to later work as a management consultant at McKinsey & Company. Later, she worked for Novartis and Nestlé to create and execute their business plans, build their internal management system, and lead the PMI. She joined Hobonichi in 2008 and led their IPO as CFO, Director & Manager-Administration. She left the company in 2018 to recharge, and joined YeLL’s Board of Directors in March 2020. Makiko is also the translation supervisor for the book “You’re Not Listening: What You’re Missing and Why It Matters” and has been an outside director at Mercari since September 2020.

Proving that our Group mission isn’t just cheap talk

——In February 2023, Mercari celebrated 10 years since its founding, and also announced its new Group mission to the world. What is the significance of this timing, and what are your thoughts on the phase that Mercari is currently in?

@Sayaka:Now that five years have passed since our IPO, I think we are currently in a phase where we are actively trying to contribute to the resolution of social issues by generating solid revenue through our business and reinvesting it. I think that Mercari members are growing more conscious of this shift as well—especially when compared to five or even three years ago. However, when operating at this scale, it can be tricky to get all members moving in the same direction. I think that the timing of the release of our new Group mission was significant in that it was an important step towards creating an organization that can adapt quickly while also regularly re-examining the company’s purpose.

@shuji:To me, when I think of Mercari, I see a company with a strong sense of purpose. Generally, people establish companies because there is some issue they want to solve. More specifically, people who start businesses tend to believe that they can solve the issue better than anyone else. Mercari’s business helps no-longer-needed items circulate to find new value in the hands of new owners, instead of being thrown out or wasted. So, the more Mercari is used, the better we can contribute to solving environmental problems and other such social issues. We continue to run this business because we genuinely believe that Mercari is the best at circulating items and can do it better than anyone else.

Shuji Kawano (@shuji)

——So, we have established that Mercari is currently in the phase of realizing further growth as a business in order to solve social issues. Makiko, as an outside director, you are in a position that gives you a unique view of the entire company. What is your view on the new Group mission?

@shinomaki:I very much believe in the concept of unleashing the potential in all people. Working with Mercari, I have been able to experience that potential for myself. Just the other day, a colleague unrelated to my work with Mercari started using the Mercari app and was delighted when the clothes they had listed were sold! Knowing that someone else will now get to enjoy an item that you also loved, but now no longer have use for, unleashes a new kind of potential in the seller as well as the buyer, and that experience left a big impression on my colleague. Even my mother, who will turn 80 this year, has started to buy things for her hobby “sado” (traditional Japanese tea ceremony) on Mercari. Even at 80, people like my mother who are interested in more traditional hobbies can experience working with new tools and do more things because of Mercari. I have seen the potential that Mercari is capable of unleashing with my own eyes.

That is why I am convinced that Mercari’s new Group mission is not just cheap talk. That said, I also believe that we must consider the responsibility that comes with setting a mission and purpose. Setting a mission is kind of like if a person were to say, “Look at me, I have something worth your attention.” But, when you say something like that, you invite doubt and scrutiny from others. So when you set a mission, you have to make sure that you’re achieving tangible results and building trust. What we should aim for in the future is to become a company where people who come into contact with Mercari, whether that be as a user of our services or otherwise, can honestly say that we are living up to our stated mission.

@shuji:I agree, we can’t just be all talk and no action. We need to balance our business results and our goal of solving social issues on a foundation of solid revenue. But it’s not only about the results; the process is important too.

Mercari’s five material topics serve as a guiding light for the company

——You mentioned that Mercari strives to balance business results with solving social issues. Could you talk a little more about that?

@shuji:Sure. I think that Mercari’s five material topics, which summarize both the social issues that Mercari needs to solve through its core business and the internal issues that need to be addressed in order for us to do so, demonstrate this point pretty clearly. For example, the first material topic is “Creating a Circular Economy/Mitigating Climate Change.” This is precisely the result that the Mercari marketplace service aims to achieve. In 2021, transactions in the clothing categories of Mercari avoided approximately 480,000 tons of CO2 emissions, which represents an 8.8% reduction in apparel waste (by weight). We hope to expand this kind of impact to other categories in the future.

We would also like to focus on collaboration with external partners. If Mercari can collaborate with manufacturers, retailers, and other primary distribution companies, our business will become that much more sustainable. Right now, the standard business model is such that retailers only make a profit from the first sale, while secondary distribution is entirely between individuals. That means retailers don’t have any incentive to make their items last longer. It doesn’t matter to them whether people throw out their used items or sell them to someone else. But if Mercari can change the paradigm so that the retailers can also profit from secondhand sales, they would have an incentive to make their products more durable and reusable. Our hypothesis is that good-quality items circulate at reasonable prices. Of course, there are factors that hinder circulation, such as damage to the item sustained during the circulation process or, in the case of electrical appliances, low energy efficiency issues with older items, but the idea is that we can work together to create a “repair and reuse” process that will extend each item’s lifecycle. We believe that it is possible to meet the demands of manufacturers and others who want to make things that their customers are able to use for a long time while also making money doing it.

Another of our material topics, “Diversity & Inclusion”, is also something that enriches both Mercari and society. Promoting D&I will definitely allow Mercari to have more diverse ideas and perspectives, making it easier to create new business opportunities and avoid risks. However, there are some things that cannot be solved by just one company alone. For example, even if Mercari achieves a flexible work style that can help women who are aiming to balance work and childcare, the potential impact will not be as great if society does not change to accept that men also have a responsibility to balance childcare with work. The reason why D&I is one of our material topics and something that we enthusiastically promote is because we believe it is important for society as a whole to think about these issues.

——Why do you think that “enriching society by enriching ourselves,” something that may seem like an obvious stance for a company to take, has only recently become more expected?

@shinomaki:In terms of corporations, the concepts of mission and materiality have been scrutinized since the advent of this idea of “planetary boundaries” (the thresholds of the earth’s limited resources within which humankind can survive safely). This idea was born from the realization that the economic conquest of humans so far is not sustainable, and if we carry on in the same manner we will be physically unable to grow any further as a species.

When I was at Nestlé before, we had these same discussions. Since Nestlé products are already sold all over the world, we could not physically expand our business any further, even if we wanted to. In addition, because we dealt in agricultural products, we were directly affected by global ecology and global warming. Also, we had a history of purchasing coffee beans from developing countries, which are prone to the problems that stem from lack of social infrastructure. For Nestlé to pursue only its own profits would be like an octopus eating its own legs, and we were aware that there was a cap on our growth. For a company like Nestlé, there was an equilibrium between conserving the global environment and pursuing our own growth.

These are ideas held not only by businesses, but also by investors. Investors understand that solving environmental and social issues is vital in order for the companies that they invest in to grow and for the investor to earn a return on their investment. That’s why investors have started more closely examining the missions and material topics of companies. Mercari also understands this concept, and our mission was born from a deep sense of responsibility to society.

Makiko Shinoda (@shinomaki)

@Sayaka:There is no doubt in my mind that sustainability in society and the sustainability of Mercari are interconnected, but I believe that we must first improve our own sustainability— it would be a real waste if Mercari were to fail before achieving our goal of creating a circular economy. Mercari’s materiality is our guiding light—it is there to ensure that, even as we look inward to improve the sustainability of our own business operations, we remain committed to the sustainability of society.

Unleash the limitless potential in all people

——That makes a lot of sense! So, in terms of the Group mission, what exactly is Mercari’s purpose?

@shinomaki:While the earth may have physical limitations, people, on the other hand, have limitless potential. The degree to which a person’s potential is unleashed depends on their environment. In the same way that people can realize new potential by using Mercari, the new Group mission also seeks to unleash the potential of Mercari Group members by making the company a place where anyone can maximize their possibilities. I think this is our purpose.

——What needs to happen in order to create the kind of environment where members can maximize their potential?

@shuji:This is a slightly abstract answer, but we need to be able to believe in the mission and, at the same time, enjoy the day-to-day work. If you’re not having fun with the day-to-day work, it is much easier for some “grandiose” mission to fall to the wayside. Without consciously taking a mission-based perspective in your daily work, every day eventually becomes just a series of unconnected tasks.

Another factor that has to be considered for individuals to be able to reach their full potential is that individual members have to be empowered to contribute to the organization—you can’t rely on everything coming from the organization. For us, the ability to enjoy the daily work, the ability to be enthusiastic about our mission, and, more importantly, the ability to love our services and members—these are things that we as professionals should strive to acquire on our own, not something that we should expect to receive from someone else. I think it is important for the company and its members to strive for co-creation.

——The idea of co-creation between the company and its members strikes me as very typical of Mercari.

@Sayaka:I agree. The stakeholders we want to co-create with are not only internal members, but anyone and everyone who interacts with Mercari. This includes our users, partner companies, and local government officials. I hope that we can work together to create a world in which, through the value of our services and creations born from the use of Mercari, all forms of value circulate and the potential in all people is unleashed.

Sayaka Eda (@Sayaka)

@shinomaki:I think the “individual” element really comes into play when buying and selling items, because there is so much diversity in the timing and the things that people want to buy and sell. We want to make sure that we are devoting our energy to both the individual and the big-picture societal problems. Mercari’s goal is to create a service through which individuals have the opportunity to experience potential-unleashing moments.

@shuji:The value of Mercari is not just in being able to buy what you want quickly and inexpensively. We will continue to strive to deliver impactful and diverse value to our individual users, whether that be the excitement of realizing new money-making possibilities or the joy of getting to use your Mercari sales balance to make payments or purchases elsewhere.

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