Tim Hitchens, British Ambassador to Japan, and Ray Bremner, CEO and President of Unilever Japan discuss marketing to Japanese consumers in this informative video.
Japan ranks second in consumer spending and luxury goods sales, and third in online retail sales, making it an extraordinarily lucrative market.
“The market sizes are absolutely enormous and therefore players who are looking for a small share can actually get a very significant turnover because of the size of the market,” says Bremner.
The high usage of eCommerce is an equaliser when it comes to appealing to customers. Companies can use their own website, or promote their products in partnership with an already established site, and in this way gain access to most Japanese consumers. The internet also reduces costs in advertising and introduction, making it an effective tool for businesses wanting to come to Japan.
“The current situation provides much more scope for entry than was the case say ten years ago,” adds Bremner.
Meeting the Japanese standard is important, and this means adapting to Japanese consumers. “The service level expected by Japanese companies is almost 100 percent of on time delivery when it’s requested,” he explains. “It takes longer to establish a strong relationship with people, but once it’s established, then it’s a very respectful and trusting relastionship on both sides.”
The quality expected of products in Japan is also extremely high, more so than in other countries, and this is something to keep in mind.
In terms of his experience with Unilever he clarifies, “We try many products in Japan and once we’ve got the Japanese quality correct, then you can be assured that when you enter other countries it’s going to be the best quality product that people can buy.”
The implications of an aging Japan, especially for a company like Unilever, is a decline in middle markets and an increasing polarisation between more premium products and lower cost products. In spite of the declining number of young people, their spending power and willingness to spend remains high. In addition, the internet and eCommerce is not just a young person’s market in Japan, with older Japanese consumers using the internet to make purchases and compare prices.
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