How Park24 Created a Brand-new Billion-Dollar Parking Market in Japan

This case reviews how Park24, a Japanese company, solved the long-taken-as-given problem of the severe parking shortage in Japan's highly congested cities and created a brand-new market of short-stay central city parking, establishing itself as the unchallenged market leader. The dire shortage of parking space in Japanese central cities was long taken for granted and viewed as unsolvable by parking service providers because of the scarcity and lofty prices of downtown land. Park24 saw that the solution to the parking problem was not building gigantic multi-storey car parks with concentrated parking spots but making parking available everywhere people went, like the convenience stores found on every corner. Instead of targeting large land plots for purchase, Park24 rented small patches of “idle land” (small patches of unused land crammed between buildings) near popular destinations and launched Times, a low-cost, secure, automated parking service accessible 24/7. With Times, Park24 created a new and fast-growing market outside existing industry boundaries. It is a prime example of “nondisruptive creation”, a term coined by W. Chan Kim and Renée Mauborgne. Times parking in central cities complemented rather than displaced existing car parks. Through nondisruptive creation, Park24 unlocked huge unmet demand, addressed a long-ignored problem, and established a strong brand and a billion-dollar business.

This case is intended for use in both MBA and executive classrooms with the following teaching objectives: 1) To illustrate what nondisruptive creation is and what the major advantages of this market-creating method are through examining Park24’s innovation of “convenience- 3 store-like” central city parking by leveraging the innovative concepts of “idle land” and “idle time of land”. 2) To explore why conventional wisdom regarded short-stay central city parking in Japan as an unsolvable problem and how Park24 found a way to address this long-taken-as-given problem and created a brand-new market of “convenience-store-like” central city parking in highly congested Japanese cities. 3) To discuss how Park24 developed and leveraged unique resources and capabilities to create a viable business model to address the long-taken-for-granted problem of downtown parking. 4) To identify which innovations by Park24 were nondisruptive by exploring whether displacement and disruption happened to existing players and what economic and social benefits these innovations brought to the parties concerned. 5) To discuss how Park24 leveraged the strong brand name and reputation it developed through its nondisruptive move to grow its business further and achieve sustained profitable growth.