In the Darwinian world of consumer retail, few markets are as tough, fickle, and potentially lucrative as the Japanese market. There are more than a million enterprises and 160,000 restaurants in Tokyo alone, competing for the attention of around 35 million consumers. Trends come and go on a weekly basis.
Japanese companies have to stand out in order to create attention and keep consumers interested. To do this, companies either need to follow a trend right away or start one for themselves. Consumer marketing in Tokyo is constantly evolving, often innovative and always competitive. As a laboratory of techniques, Tokyo can offer potential tools to markets further afield.
The Louis Vuitton Underground concept store in Ikebukuro reinvents the luxury brand as a street fashion brand for the fickle Tokyo retail market.
Photograph by Phil Couzens
Brands in Japan are reinventing themselves
Japanese consumers love brands. In the world of luxury goods, where exclusivity is the key component of marketing, Japan stands apart. The nation is said to be the world’s only luxury mass market with surveys indicating that almost all Japanese women own at least one Louis Vuitton item. The brand is thought to be the favorite among the consumer conscious Japanese public.
But this does not mean that consumers are always brand loyal. Once a brand becomes “uncool” or does not offer the expected value anymore, consumers easily switch to a competitor’s brand. So, in a market where consumers of all income brackets buy expensive brands, how do marketers ensure that brands stay exclusive? In order to combat this problem, Japanese brand managers have developed a number of ideas to keep their brands attractive to consumers.
Leading again here is Louis Vuitton. The company opened its first concept store in Tokyo, in cooperation with the Seibu Department store chain. Louis Vuitton Underground in Ikebukuro presents LV products in an environment that would have never been previously associated with the brand – a construction site. Meanwhile, other brands have entered a completely new field: the service industry. Bulgari in Omotesando has started serving handmade, Italian-style chocolate. Real Bulgari fans can even go so far as traveling to Bali to stay at the company’s own resort. Furla, the Italian leather manufacturer, also offers coffee at its Ginza shop and invites customers to participate in Furla Yoga in Aoyama. Taking a different tack again, Chanel teamed up with France’s chef Alain Ducasse to give Chanel customers the chance to wine and dine in an exclusive restaurant on top of the Chanel building.
Brands represent their customers’ lifestyle and the overall brand experience is perceived to be enriched by these new activities and ideas. Customers can now feel and experience the brand with all of their senses. This in turn improves brand loyalty and gives many traditional brands a new, cooler and younger image.
Consumers involved in product design
Consumers are increasingly interested in customized and individualized products and, consequently, business models which help customers design their own products are booming. As consumers seek out unique, personalized products, they are also becoming interested in customizing the products they buy. Bling Me, a company which helps customers personalize their mobile phones, bicycles, etc. with shiny stones, is one example of a company that has based its business model on customers’ desires to create their own products. Some brands even go a step further and include customers in their product design processes. Soup manufacturer Maruchan and beverage company Calpis have even starting asking their consumers to vote for their favorite flavors each year.
Integrating customers in product development processes comes with rewards. Customers feel more attached to the products and show more interest in the overall brand. The company meanwhile can create greater customer feedback and launch campaigns that specifically target their customers’ wishes and ideas.
