Next-wave Japan brands stand to score big in emerging Asia: JWT
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JAPANESE companies that develop a clear brand idea, play up provenance and shed the innovative-but-unglamorous label have an unprecedented opportunity in emerging Asia, according to international advertising agency J Walter Thompson (JWT).
A new wave of Japanese companies is moving swiftly into Asia’s high-growth emerging markets to offset slowing sales and an ageing market back home. Foreign direct investment by Japanese companies hit a five-year high of US$135 billion (Bt4.5 trillion) in 2013, according to a report last year by the Japan External Trade Organisation.
The biggest recipient was the Asean region, which will unite into a free-trade zone comprising 600 million consumers this December.
As these aspiring Japanese multinationals enter Asia’s emerging markets, they need to compete with domestic legacy brands and brand-savvy Western rivals.
That may pose challenges to some Japanese companies, which typically emphasise product rather than brand differentiation.
To help Japanese companies consider how to build, and position, their brands in Asia’s key emerging markets, J Walter Thompson Asia-Pacific surveyed 3,200 consumers, aged 20-49, in Indonesia, Malaysia, the Philippines, Vietnam, Thailand, China and India, as well as Japan.
The research found that consumers in Asean and India deeply admired all things Japanese. They want to visit Japan, more than any other country in the world, and they describe it as a “loved one”, “mentor” or “best friend”.
“Made in Japan” equates to high quality, reliability and superior technology, and consumers are highly disposed towards purchasing Japanese goods.
Japanese brands are reliable but not evocative. There is a gap that needs to be filled with a clear position and powerful brand idea, JWT says.
Consumers in emerging Asia are more open to engaging with brands online, and feel more strongly that brands express their personality, than consumers in Japan.
Japanese brands need to develop a strong digital strategy that reinforces a clear brand idea if they want to connect with these consumers and move them up the value curve, the agency says.
Asean presents a unique opportunity for Japanese brands. Consumers in this fast-growing region not only have high admiration for Japan, but are also the most willing to try new brands – and they are also less likely to think Western brands are more stylish than Asian brands.
Japanese companies targeting China need to approach this market differently from the rest, says JWT.
“Consumers in much of emerging Asia already love Japan. Brands just need to tap into that ready, deep pool of affection, trust, admiration and respect,” Ratan Malli, director of strategic planning, said yesterday.
“Japanese brands should use their inherent Japanese-ness as a point of distinction and leverage on distinctive elements of Japanese culture to build a unique and compelling brand identity.
“While ‘innovation’ and ‘reliability’ are top of mind, there are many more facets of Japanese street culture, style and craftsmanship that brands can tap into that will strike a chord with consumers across the region.”
Japanese brands should play up their provenance in emerging Asians markets where Japan is highly admired. They should also exploit the technical advantage that is already associated with Japan and its products.
Even in non-tech categories, the scientific innovation and quest for perfection that consumers associate with Japan offer a powerful route for communication.
To amp up the cool factor, brands could do more to leverage other distinctly Japanese qualities, such as attention to detail and craftsmanship, as well as Japan’s youth-driven counter-culture that has put Japanese fashion and anime on the world map.
