Q&A: Local versus global brands in Japan

Jun. 12, 2017
  • Reportage

Source: Campaign Asia-Pacific
Writer: David Blecken, Campaign Japan

We asked four in-market experts for their take on the prospects for local versus global brands in Japan

We asked four in-market experts for their take on the prospects for local versus global brands in Japan.

Participants:

  • John Woodward, chief strategy officer, McCann Worldgroup Japan
  • Chris Iki, COO, TBWA Hakuhodo
  • John Rowe, MD, Wieden & Kennedy Tokyo
  • David Burger, deputy MD, Geometry Global Japan

How much growth opportunity is there still for international brands in Japan?

Woodward: There’s certainly growth opportunity for international brands in Japan, and we see many of our international clients re-investing. The first thing to remember is that there is still market growth, it’s just not evenly spread. A slow growth economy doesn’t mean that no sectors of the economy have high growth. If you look, for example, at credit cards and electronic payments, or functional foods or pharmaceuticals, or ecommerce, these are sectors where the market is growing very significantly. The second thing is that most Western companies have very small shares in Japan. So, their real opportunity is to grow market share. And the market is so huge that even growing a few share points can affect the bottom line.

Iki: The days where people draw a deliberate distinction between ‘international brands’ and ‘domestic brands’ are over, with a very few exceptions, which leaves plenty of growth opportunities for international brands in Japan. It’s not about ‘international’ versus ‘domestic’ brands. It’s about brands that offer products and services that are relevant and meaningful, but also ones that ‘connect’ with people. With Japanese tourism booming in recent years, and as the country gears up to host the Olympic Games, Japan is hoping to attract 40 million visitors in 2020 alone—providing huge growth opportunities for international brands in Japan, beyond the Japanese consumer. The country is currently ranked the world’s #2 luxury market, with tourists accounting for about a third of top-end spending.

Rowe: The key factor is the quality of your offering; if you offer a best-in-class product, service or experience, and you market it well, you can absolutely still find growth. In the short term, I don’t see this changing dramatically. In the long term, the mature brands are the ones who need a Plan B. You are already seeing staple Japanese brands struggling to find growth in Japan and looking outside. Mature international brands will be the next to feel the pain. But I think international brands looking to enter japan for the first time can still find plenty of success now, and for years to come.

Read more at: http://www.campaignasia.com/article/qa-local-versus-global-brands-in-japan/436841

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