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Japanese Consumer Dynamics

Agenda

• Professor Parissa Haghirian, Guest Professor of Japanese Economy at University of Munich, Associate Professor of International Management Faculty of Liberal Arts, Sophia University, Tokyo

• Professor Emmanuel J. Chéron, Professor of Marketing Sophia University, Tokyo

• Aaron Toussaint, Research Manager at Five by Fifty marketing research agency

• Professor Stephanie Assmann, Associate Professor of Cultural Studies, Akita University

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Japanese Consumer Dynamics

• Japanese consumers have changed dramatically over thepast fifteen years.

• Big spenders of the late 80s bubble economy • Now price-conscious, wealthy and sophisticated shoppers• Demanding the world's best service and most innovative products • Today we will provide an overview on the development of Japanese

consumerism, the particularities of Japanese consumer behavior, new consumer groups such as the Silver Market and young male Consumers and the Japanese food market today.

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Japanese Consumption

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• Started in the 1960s (mai kâ and mai hômu)• At the same time Japanese were showed the highest saving rates

worldwide• Changes in society (housewifization)• From 1970s Japanese consumer became increasingly

important for Japanese corporations• Bubble economy – consumption as a hobby• The lost decade changed retail structure and

consumer behavior

Japanese Consumer Behavior

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• Has been hardly investigated by Western researchers• Has changed over the past decade• Japanese consumer are said to be

• Group oriented• Price-conscious (depending on the product)• Love brands

Are Japanese Consumers Group Oriented?

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• Japanese consumers are seen as collectivistic byers, their consumption is very strongly influenced by peers

• Fads and panic-consumption• The immense choice that Japanese consumers

have, led to to a certain degree of individualisation (e.g. Brand mix)

Are Japanese Consumers Price-Sensitive?

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• Japanese consumers showed little price-sensitiveness during the bubble time. This changed during the recession

• Petite luxury consumption (price-conscious when buying generic goods (household goods), but big spenders when it comes to luxury products (also including food)

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Quelle:Mc Kinsey Studie, 2009::Luxury goods in Japan; p.13.

Japanese Consumers Love Brands?

• Luxury is no longer as attractive as it used to be to some consumers

• December 2008 survey: only 32% of respondents said they were very or somewhat interested in luxury products, compared to 54% in 2004 (Nikkei Institute of Industry)

• Over the past year even the most optimistic consumers decreased spending

• Luxury consumers remain brand loyal, but looked for special deals

• Luxury shoppers are willing to travel overseas for deals on luxury goods

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Luxury-brand Bubble of 2004-2007

• Crisis only partially explains the changes in the luxury market in Japan

• Steady appreciation of the euro against the yen decreased demand

• Unique characteristics of Japanese luxury shoppers – middle class, and thus the demand in Japan is not as inelastic as in countries with high income inequality

• Long-term shifts in consumer behavior: new trends to mix inexpensive goods with luxury goods (H&M, Forever 21 in Ginza)

• ”The days of simply slapping on a logo and charging a ridiculous price are gone” - Fiona Wilson, the Asia editor of Monocle, a style magazine. Instead, there is more interest in craftsmanship and value for money. (Economist, 2008)

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Luxury-brand Bubble of 2004-2007

Consumers Spend Less

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Analysts expect anxiety to decrease once the government presents a future plan for the nation.

Consumer confidence (in livelihoods, income growth, employment conditions and the timing of new durable goods purchases) showed the sharpest fall since 2004.

Luxury Sales Dropped in the Past Months Traditional luxury shoppers (Arafo) changed their consumer behavior already (ethical and eco-friendly values and enjoying the present

Once the economic crisis is over, only 65 percent of luxury shoppers across the demographic groups are planning to

return to their luxury spending habits. About 1/3 of consumers claimed that

they will never spend the same way on luxury items

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Some Industries are Booming!

Changes in consumer attitudes and behavior can so far only be anticipated

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Thank you for your attention