Q&A: The factors that make Japan a unique market

We asked three in-market experts for their insights into Japanese consumers.

Participants:

• Sosuke Koyama, executive planning director at Beacon Communications
• Stephen Cox, CEO, Havas Tokyo
• Leonard Le, senior strategic planner at UltraSuperNew.

In 2017, what distinguishes Japan’s consumer market from others?

Koyama: Maybe from the outside, it seems like Japan’s this wacky place that’s changing all the time and to a certain extent, this is true. But when you live here, I think you find this change to be more novelty than a genuine openness to a deeper, more fundamental change. And maybe this has something to do with the extremely collec;vist nature of Japan. It’s a culture where you need to build consensus on just about everything and so it takes a lot of energy to agree on anything meaningful. So, more oEen than not, you agree on stuff that gets easy consensus and life usually goes on unchanged. Amused and sa;sfied with novelty, structural reforms go unaddressed even if they’re necessary to the point they threaten the future of Japan.

Cox: Two things stand out more than ever—context and convenience. The context that brands gather around themselves through their ecosystems of relationships and constant engagement across all channels; and the consumer expectation for perfection of convenience ­ largely enabled by the ecosystem of relationships. Neither is new, but both continue to distinguish this market and the less obvious under-layers of activities beneath the advertising and engagement that we see.

Le: Japanese consumers are always just a bit more demanding even if they might not be vocal about it. Consumers in other countries tend to use social media as an outlet to reach brands directly and make their opinions known. Japanese consumers don’t say as much but are judging a lot more. There’s a very high threshold before people start complaining. Even privately, there’s a certain amount of restraint in how much people want to say, because of the sense that it’s a waste of time complaining. Instead, they just won’t go to that store/brand any more.

What do you see as the most interesting consumer trends unique to Japan?

Koyama: It seems like everything in Japan these days is being ‘premium-ised’. You can’t just launch a beer; you have to premium-ise it by sticking an old craftsman on it, calling it ‘Grand Kirin’, and localising it by calling it a JPL (Japan Pale Lager). Or in travel, the local railway companies are launching super-luxury sleeper car services this year (‘Shikishima’ and ‘Twilight Express Mizukaze’), where a two-night ticket can cost 1,250,000 yen.

Cox: This is a difficult one. I suppose increased catering to family, my-time, my-place, my-space, and a host of other themes focusing uncharacteristically on the individual, and by extension of that, the easier acceptance and greater provision of unconventional choices. This does lead to a richer market place, but may become hampered (or driven) by what looks to become the abandonment of both full-time employment and the pursuit of a conventional life from school to family to retirement. In a sense, these trends bring Japanese consumers more in line with non-Japanese, and so may not seem unique to Japan. But that these were not key drivers until very recently; that they are new and eyebrow raising trends is unique to Japan. Leveraging these new expectations needs to be done carefully within the context of where they have come from.

One of the many (unfortunate) outcomes of a focus on the trends of the day among the marketing players at foreign brands (and agencies) is the growing misconception that the marketplace and the consumers within it are starting to behave just like those outside of Japan. Superficially this may appear to be true, but the drivers behind the behaviours are different, and responding to those new, seemingly familiar behaviours, without reference to context and as if they are actually the same is a trap into which brands looking for easy quick fixes can easily fall.

Le: One is that millennials may have low confidence in Japan as a country, but the opposite is true for themselves and their generation. Yet their most desired job is to be a civil servant. That is out of a desire for security and it has to do with the fact that young people are still trying to figure out what direction the country is going in and they don’t have anyone to learn from. While this is happening, companies are still obsessed with going after retirees. They haven’t figured out the right way to talk to older people but are still fixated on it, and at the same time forgetting about the younger person’s market, which is opening up in a way it hasn’t before.

What cultural issues to foreign brands need to be aware of when marketing in Japan?

Koyama: A culture bent so strongly on consensus building means foreign brands with strong points of view can easily rub Japanese the wrong way if they’re not careful. But this also doesn’t mean foreign brands need to follow what domestic brands do, which in the realm of advertising would mean just hiring a celebrity, finding some shrill music, and then building a tangential connection between said celebrity with the product you’re trying to sell in your creative idea, if you even have one.

Cox: Multitudes, but many foreign brands miss the fact that soft sell over time works where hard sell can backfire. Patient communications and sometimes even vague proposition values often (when in context) win out over claims of leadership and superiority. When there is a context in place, the culture demands a high attention to the detailed USPs of a product or service to demonstrate the incremental superiority over competitors.

Le: International brands sometimes get overconfident and overlook the fact that they need to know how to speak to Japanese consumers, about topics that matter here. You do need to keep communications consistent but also find a way to make sure they are relevant. Japanese consumers also have a desire to see commitment. When they feel you’re not committed to this market they feel you don’t value them as a customer. Brands forget that there’s this expectation. In certain markets there’s already a level of distrust, or a sense that companies are never out for your best interests. Japanese consumers are not naïve, but they demand a bit more. If you’re not going to bother to meet that level of responsibility, don’t come.

What do advertisers need to avoid if they are to build strong brands?

Cox: More than ever, the temptation to put tactics (and short-term gain) before strategy (and sustained success). Technology makes tactics more plentiful, more fun, faster, and easier to produce than ever before. Cost and time pressure makes them more attractive. As Sun Tsu wrote, “tactics before strategy is the noise before defeat”. At no time before in my 3 decades in Asia, have I seen such noise—an almost casual trade-off of strategy for tactics. Under-resourced marketing teams, high talent turn-over, and short turn-around times play a role here.

Koyama: I think foreign brands actually have a better shot at building strong brands here than their Japanese counterparts. It’s because they tend to have a strong point of view. As long as this point of view is couched in a relevant Japan-specific insight, then foreign brands can build a deeper, more meaningful connection with their audience as opposed to just distracting them with celebrities and novelty.

Le: Don’t come in thinking you know this audience. Brands assume people are all the same. But it’s becoming so niche here that findings from overseas don’t work. You need to do the legwork and figure out who you should be talking to, not just pass it off to an agency. There are times when the market is not so unique but others where it still needs to be held as an exception. It’s a balance that’s tough to navigate at times but that’s the way it is.