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Changing Consumer Psyche Creates Opportunities

By: Debbie Howard

Since my job is to watch and listen to Japanese consumers, I thought I knew them very well. But just a few years ago, I saw something I had never seen before. I was sitting behind the one-way mirror; on the other side were a group of Japanese men, seated around a table in a typical focus group. We were exploring response to a new investment product. In previous groups on a variety of topics, Japanese respondents — particularly males — had been extremely reserved with their opinions. But this was different.

When one of the males said the product seemed like an improvement over what was currently available, another of the men turned red in the face. “I hate Japanese banks,” he grunted loudly, pounding his fist on the table. “They don’t do anything for us (customers).” Before long, the entire group was ranting at one another in a most un-Japanese-like manner. It sounded more like an American or European focus group than anything I had heard since arriving here in the mid-eighties.

We “Westerners” (i.e., North Americans and Europeans) have long held the belief that the Japanese consumers are “homogenous,” that they are “followers,” that “Japanese traditions are immutable.” Other presumed characteristics included a maddening attention to quality, high expectations for service and aftercare and a predisposition to “buy Japanese.”

It soon dawned on me, however, as I watched the group arguing on the other side of the mirror, that the Japanese market, and with it the enigmatic Japanese consumer, had turned a corner.

What caused this change? During my 22 years in Japan, the Japanese economy tumbled from its peak in the mid-80s, down through the economic dead zone of the 90s, and onward to partial economic recovery today. Throughout this period, Japanese consumers have been forced to adapt to a new reality, having faced a number of dramatic “psyche changing” events. For example, with the end of lifetime employment — as well as a prolonged high unemployment rate — many people have had to find new ways to make a living, including part-time jobs and entrepreneurial activity. Similarly, realizing that another key social safety net — company pensions — might not be as readily available, attitudes toward savings and investments have begun to change, with many now actively seeking non-savings vehicles as a way of hedging for the future. Even “foreign” financial products are being considered with a far less jaded eye!

Japanese consumers have adapted admirably and continue to do so. As a result, a very different type of consumer is emerging — one that is more self-responsible, more independent and even more individualistic. Japanese consumers — long a challenge for Western marketers — have begun to create new and different lifestyles for themselves, and there is greater tolerance for nontraditional life paths. This is good news for foreign companies who bring new and different product and service solutions to the Japanese market, and who were previously somewhat blocked in the past by Japanese loyalty to traditional “Japanese” goods.

Debbie Howard is Chairman of CarterJMRN and President Emeritus of the American Chamber of Commerce in Japan.

Originally Published in Nikkei Weekly, 16th July 2007

CarterJMRN is a strategic market research agency that has been helping clients with consumers and businesses in Japan and beyond since 1989.

We believe that, although the terrain you face in building a successful marketing strategy and activation path sometimes seems obscure, the path to success is knowable and that the consumer is the guide who will show you the way.

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