HNWI marketing in Japan

How well do we know consumers? Wrong question. Why should we even care?

2013-04-19T02:23:00.003-07:00

An article in the Luxury Society called "How Well Do We Really Know the Chinese Luxury Consumer?" http://luxurysociety.com/articles/2013/02/how-well-do-we-really-know-the-chinese-luxury-consumer

I was wondering ... where are those research results coming from. The BCG has conducted a research, the exact wording is "BCG research confirmed ..." - no mention of the research design, the sample size, the way the online panel (and I am sure that its was online) has been constructed. As if it would matter when a big name such as BCG is behind the research.

Well, it does. If any experiences from Japan would show only a glimpse of what we could expect in China, where the concept of luxury is much younger, if underdeveloped and overly status focused (and no, they do not aim at individualism, the same way that Japanese do not even after 40 years), then China can be expected to be much less transparent when it comes to validating the relevance and representativeness of a sample. Validation and representative samples, relevance. Yes these words matter when it comes to research design. If they do not matter anymore, then research becomes a meaningless reproduction of signs, a simulation of meaning. Something that marketing departments do to confirm what they have done so far, do get KPIs (key performance indicators, .... how this word has distorted so many minds that were once able to think logically and with reason), to make sure budgets are approved, to make sure that no one finds out that the decision makers approving a research design are in no way able to judge the validity of the data, nor the vendors, nor able to judge the complexity of the issue.

There is an issue. Explanations and a deep analysis would be too much. Let us just recapture some of my favorite "symptoms", things that are far too common to be ignored, yet no one is doing anything about them, as the KPIs are in order.

- Online research panels in China where hordes of Chinese middle class consumers are faking IP-addresses using special software to fill out survey forms of research companies to be sold to major luxury companies. Faking their location, faking results, "yes, of course we buy 5 LV bags a year, yes our income is above this, yes we love this brand, yes we live in Shanghai (in truth deep country side, no money, sitting in front of a laptop)."

- Research companies that are painfully aware of the fact, yet do not care, as it enables them to come up with the right cost/survey sheet ratio. not one thought about the quality or the reasonable doubt "would a person with this high an income really spend their times on online surveys?", or the more apparent doubt "If I know I can make money with faking results, why would I not?"

- Research companies in Japan that research topics such as fashion and luxury that they know nothing about, asking the wrong questions, interpreting the answers in the wrong way, yet never questioning their own ability to do so.

- Research budgets that are limited and ask each vendor to come up with solutions fitting the budget that is decided already, without knowing if the budget is enough to produce any quality results. It is like going to Louis Vuitton and H& M asking each to come with a proposal for a handbag, and telling both, the budget was approved, we have 100 Euros. What we want is a high quality bag that holds for 10 years, made out of leather. LV's response is, sorry guys, we have what you want, but at 700 Euros and above, and we doubt anyone can produce what you are asking for at that price. The gross thing is to EXPECT that LV might somehow magically provide better quality at the same price.

- And to conclude the very short list (that could go one endlessly), my personal favorite. Taking what the consumer says in online research at face value. Asking very creative questions such as "What is the reason you bought this handbag?" - options: price, design, quality, brand recognition ... how about giving this option for a change: "I bought this handbag from Chloé because I like the brand since high school after I realized that it is higher in reputation than LV that almost everyone has in high school and in university, but only if they are not too oshare. I realized that office ladies with taste have the brand, but basically it was because all my friends have been talking about the brand for years, and because I see it in advertorials for the last 3 years in ViVi, Sweet and also in Vogue Girl, and my favorite models have featured it on their blogs. I feel safe with the choice and no one will criticize me for choosing the bag. Also, everyone at my school had See by Chloé and I thought that by buying the real thing, they would respect me and look up to me a little." - please cross: I somewhat agree, I agree, totally agree, not agree, not agree at all??? How can I somewhat agree with this? How about giving choices like social anxiety, safety of choices, reputation of the brand to be associated with a style group that reads certain magazines. Well, they did not teach these questions at business school. They did not mention during the MBA that in Asia consumption is more about social conformity, social values, social pressure, anxiety of making choices that one is critcized for, than about presonal preference.

the list goes on.
What you need is expertise. Expertise in the subject matter and involvement with actual consumers. Its like investigating a crime scene. You need an expertise in criminology to understand the problems coming with the research. You need expertise, experience, knowing how to ask the right questions and why. How to we judge bias? How can we check the quality of research in Japan. There are ways. There are simple principles. In the next weeks we will introduce them, breaking down the complex market into simple arguments, that make sense. Research is not complocated. All you have to do is use your brain and ask simple questions such as "Do I really believe this?" "What if she is lying?" "How do I know she is telling the truth?" or the most important thing: "Does her answer matter? Is she the one that we should ask this question?" - Think, does asking the shop staff of a convenient store in Yokohama who fills out a survey at night, faking her income and location, and who fills out the survey with 30 questions in 2 minutes or less, does this really interest me? Do I want to pay money for that?"

If it does not, why pay for it?

A research company should be able to prove and validate each data point, and explain how the sample was constructed in detail, meaning, publishing the incentives given to the consumers filling out the survey, and how the incentives might bias 1) their inclination to tell the truth and 2) the bias in selecting the sample, meaning, do certain groups NOT participate because of the missing incentives or missing access to them, and how does this distort the sample, the answers, and most of all, the value for the company commissioning the research.

Test your research agency. Ask them how they keep this from happening. As the BCG, McKinsey, and all the other big names, how they make sure. And ask them what they think about this problem in the first place. Ask for transparency and for their own assessment of the QUALITY of the data.

What a difference two years make ...

2012-09-14T19:04:00.000-07:00

2.5 years ago we asked students and young professionals age 18-25 what models they look up to (akogare) and idolize. Strongly linked to magazine readership, often associated with magazines (such as Hasegawa Jun with Glamorous or Kiko-Chan with Nylon and Vogue Girl), the popularity of models is a clear indicator of market trends and changes in the main narratives. In the year 2005, Ebihara Yuri would have lead this statistic, as the epitome of the royal road to mote-kei, the queen of CanCam.

These years, the time of the Post-Gyaru style and celebrity fashion, Topshop and American Apparel, we see a completely different landscape. Without further comment we publish two statistics, one from 2,5 years ago, one from 2 months ago. Next week I want to comment myself on these results, until then I will let the numbers speak, bias included.

Who is reading me? - Cluster Analysis of female fashion magazines

2012-08-31T10:50:00.000-07:00

In the last weeks Japan Access has gathered and analyzed new data on magazine readership among young female consumers (age 18-25). Using a new analysis method and the new clusters that we have defined for magazine readership, we will uncover fine differences in readership and consumer preferences. This allows for strategic decisions on media strategy and branding. More to come within the next days.

Profiling HNWIs - Professional Rich _WH0054

2012-06-24T10:49:00.000-07:00

The HNWI travel report takes a deep look on how HNWIs (富裕層) in Japan travel, and at their images of hotel brands. This report offers a different perspective on HNWIs and their travel behavior in Japan. The difference lies in the amount of detail, its relevance and closeness to the consumer group analyzed, and in the way to access this information. Through continuous interaction with Japanese millionaires over the course of over 10 years, we acquired access to their networks and permanent exposure to trends and changes in their consumer behaviour and mind-sets.

Great care was taken in analyzing the results, and due to the enormous amount of data—nearly 700 pages of hand-written answers—we spent 3 months entering and formatting the material. All materials gathered are the voice of HNWIs, with all contents derived directly from their opinions, their accounts, the essays that they wrote for us. Each survey sheet was filled out by the HNWIs that are all personally known to us. Throughout the report we inserted complete lifestyle profiles of selected HNWIs which will give a more complete picture of who these affluent Japanese are.

The graphic shows one of the 97 profiles that form the basis of the report. She is an example of the professional rich—doctors, lawyers, financial dealers, fund managers, and also successful bureaucrats, and are characterized by one common attribute: they are caught up in a routine of their jobs and have high earnings they generate through a steady work-life. They use consumption and travel as a way of rewarding themselves for their hard work over the years and often have high demands when it comes to products and services and very personal preferences.

In Japan, being a member of the professions mentioned above almost guarantees a well-to-do lifestyle. The individuals analyzed here were the more successful ones from a class of affluent professionals, they made it to become millionaires. From all the analyzed groups they are the most busy and are used to a fierce and clearly defined competitive environment. Socializing with their clients is part of their lifestyle and defines in many ways the way they travel and spend their leisure time.

Over the next weeks we will publish more sample profiles that allow a glimpse into the real world of HNWIs in Japan. The results are as fascinating as they are often unexpected. Did you know that Daikanyama is one of the most popular shopping districts for rich Japanese or that Japanese affluent travelers spend in average 20 days per year traveling, spending an average over 27,000 US$ per year on travel? Or were you aware of the fact that 42% of rich Japanese have never used concierge services even though most have the opinion that they could enhance their travel experience if they would offer more precise information?

Shopping districts for HNWIs - visualized

2012-06-16T01:21:00.003-07:00

Shopping districts of HNWIs, n=97

HNWIs in Japan show very distinct shopping patterns when it comes to choices of shopping districts. We have visualized the results from our HNWI survey executed among 97 HNWIs and show the difference to young consumers from elite universities. What surprised even us is the prominence of Daikanyama among HNWIs, with 26% shopping in that district, reaching the level of Roppongi Hills and Midtown. The very bad image that Shinjuku commands among HNWIs was confirmed by our statistics.

Shopping districts of female university students of Elite
private universities (Keio, Waseda), 18-25 years, n=342

Magazine Survey 2012 being executed

2012-06-01T23:01:00.001-07:00

The magazine market in Japan is in constant flux and current developments are a proof of this. Western celebrity styles emanating from LA and foreign blogger sites, magazines such as Gisele, Glitter, lately also Post-Gyaru titles such as ViVi and Sweet, and of course the popular gossip magazines (with Gossips as the most popular choice) are keen on keeping their readers up to date on who wear what, with Gossip Girl stars making the front pages of many publications. And of course there are Vogue Girl, Elle Girl, and the more complex reasoning behind Nylon and why it fits neatly into the fashionista narrative among Japanese young female consumers.

We wanted to know more. So we started to back up our data that we have gathered in over 100 deep interviews with concrete statistics that will show us how the magazine market has developed since 2010 when we conducted our first large-scale survey among Japanese elite university students. Back then we gathered 1,483 responses, with 890+ female respondents.

Now we are on campus again and will go to to the core of what, how, and who. Expect updates on our insights within the next weeks. I am back to reading Tokyo ViVi now, one of the interesting "hybrids" that are the result of the recent developments, with a yet to become clearer concept, somwhere between ViVi and Nylon from the design, with a sort of "grunge/blogger-esque/top shop/american apparel" style but basically unchanged brand selection when compared to ViVI. Even though the name would imply, there is no overly focus on Tokyo in this magazine.

Luxury marketing as a social game

2012-06-01T22:41:00.003-07:00

Luxury and Japan appears to be a love affair (to quote Chadha and Husband) that has reached a stage of crisis. Japanese consumers are famous internationally for their immense consumption of luxury goods, especially handbags. Star brands such as Louis Vuitton, Gucci, Hermès and Chanel managed to attain a status as social entities, as part of the Japanese society. The reasons for this phenomenon and the crisis in the luxury market in Japan that went hand in hand with the rise of fast fashion, are complex.

What we want to focus on here is a neglected aspect concerning the marketing strategies of luxury brands. Even though many phenomena in Japan can be attributed to band wagoning, a need to show social status, conformity to group pressure and the fear of standing out, there is another level of attention for these luxury brands, that the consumers themselves are often not aware of consciously.

Brands often respond to shifting market circumstances by trying to micromanage every aspect of the brand. But it is exactly the brands that embrace the market by being as fluid as possible while maintaining a consistent brand identity, that are able to flexibly translate themselves into the Japanese market dynamics.

Luxury marketing in Japan is not solely about attracting customers. It is about winning a complex social game, about creating opportunities and access to gatekeepers, to opinion leaders. As a long-term strategy, luxury brands should direct themselves in achieving a sustained relationship, a conversation, with the consumers within the market place.

The simple fact is that many brands lost touch with their Japanese consumers. Their strategies no longer resonate with what is happening in Japan. Without a narrative that can sustain a conversation in the market place, the tendency was that Japanese consumers took hold of the brands and consumed them in ways that are out of the hands of the brands. Luxury brands in Japan used to be present as a dream, something to aspire to, that was closely integrated into the society and its modes of social stratification. But society changed dramatically and brands started to become painfully aware of the fact that somewhere along the way their own narrative was lost.

It was the construction of the dream that went wrong. The dream was part of Japanese society with its status markers, and not part of the narrative of the brand. European super brands with history and prestige must understand how much of their tradition has been stripped from their brand stories, be it because of the language barrier or the missing need to display sophistication and knowledge about brands in Japan.

Luxury brands exported only the product. Due to this brands lost control over the fate of their brand image in Japan. Brands must start to develop lasting strategies, both online and offline, that can also export the narrative. They must create topics to be discussed within networks, which are then turned into categories by which brands are evaluated (heritage, quality, craftsmanship, country of origin, and production sites). Talking about the story of a brand has to have social relevance within networks.

Luxury brands in Japan should not mellow with age but present their meanings anew, reinterpreting them within a new cultural paradigm. Luxury brands should not have to constantly reinvent themselves, but they certainly should constantly reinterpret themselves.

Our beliefs for a luxury strategy in Japan are summarized below:

1 _ Clear associations Clearly defined associations to social groups are important in Japan. Brands without clearly defined associations to reference groups have trouble bestowing meaning on the products to the consumers. Ambiguous associations bring about confusion and rejection of the brand narrative and create insecurities.
2 _ Legitimacy in the West. In Japan there is still a strong tendency that a purely Japanese face can rarely legitimize a product whose aura is located abroad (compare with W. David Marx, 2007, Race as a Fashion Signifier, http://neomarxisme.com/wdmwordpress/?p=80). Brands can create legitimization through continuing brand advertising in high fashion magazines (Vogue, Elle, Numéro, Souen) while using selective high class advertorials in popular Japanese magazines with half-Japanese models (as Chanel did in Glamorous with Hasegawa Jun in the October 2010 issue).
3 _ Sensual orientation of the Japanese. In the West the hedonism of consumption is not as concrete and sensory oriented. It is more abstract. Brand signs and signals in Japan are manipulated much more loosely and have to be visually compelling.
4 _ Understanding the best customers. The best customers account for a disproportionate amount of the sales, depending on the brand and segment in question. It is then of paramount importance to deepen the relationship with the best customers (CLV, Customer Lifetime Value) and referrers (CRV, Customer Referral Value). Brands must understand and delight them. It is more important to spend significant amount of time with them to obtain first hand insights as opposed to reading standard market reports.
5 _ Create a dream, do not sell. If consumers see a high class luxury brand as a dream (that they develop “akogare”, something to aspire to) as a university student or younger, and then begin to buy into the dream later, then you have started to develop a lasting brand image. Therefore do not advertise to sell, but build a dream, a brand image. Kapferer (2008, The Luxury Strategy) emphasizes this heavily, and it is as true in Japan as it is in Europe. Yet, Japanese marketing departments are often unfamiliar with the concept of branding and see it as a distinct discipline.
6 _ Transgressing life stages. Brands should understand the different dynamics among working women (office ladies or OLs) and students, the transition into adulthood, and later becoming married or a mother. Dreams, or “akogare” should be crafted accordingly transgressing life-stages. Luxury consumption in Japan is about social mobility and communicating the right signals throughout.
7 _ Adult consumption. The self-reflection of OLs is more sophisticated then the students, naturally for they now have adult responsibilities, more serious relationships, and money. Working women want to limit their choices, discard certain behaviors as being inappropriate to their new life as judged by themselves and society at large, and of course in their social network. Their brand choices become more realistic and practically oriented.
8 _ Create narratives to fill a lack of dreams. Working ladies and moms do not spend as much time socializing as students do. Consequently many working women’s lives seem to lack narratives that fulfill them. There is an unoccupied space waiting to be filled by a high quality narrative, a narrative that sells a dream, an “akogare”.
9 _ Engage, do not pamper. Luxury brands must engage luxury consumers, but not pamper them. The strategy is to create exclusivity, a dream, then reign with charisma and intimacy. Do not do as your customer wishes, but know how they feel and think. Then guide and inspire them. The famous quote by Henry Ford: “If I had asked people what they wanted, they would have said faster horses.” is often cited by marketing officials to question the usefulness of marketing reports and consumer insights. This is a grave mistake in our opinion. Simple put, marketing luxury products has little to do with constructing cars 100 years ago, and marketing seasonally changing taste is more complex than this. Knowing what people want does not in one instance imply that you do what they tell you.
10 _ Be creative and intimate. Japanese are fast at becoming tired of any approach. Get an intimate feel for the networks, achieve a closeness with your customers through informal channels and keep your finger on the pulse of Japanese consumer trends. One brand update every few years is not enough, you must continuously feed your brand with information from relevant networks. Recreate the brand in a fresh way.

Magazine Lifestyle Paths

2011-04-13T04:37:00.000-07:00

Japan Access has conducted highly sophisticated studies on magazine readership among female consumers. Based on the results of over 1,500 surveyed individuals and over 300 personal interviews with women on their shopping behavior and media usage, we were able to recreate what we call "media lifestyle paths". In figure 1_01 we have summarized most of the women magazines in the Japanese market into a diagram. The diagram looks complicated, but is in truth only complex, which is not the same thing. Treat the diagram like a map, only focus on the part of the terrain that you are interested in, and look what can be seen there. The X-Axis shows the style orientation of the magazine (and its readers) while the Y-axis shows the age category.

Figure 1_01_WOMEN MAGAZINES The "magazine map" will be updated regularly. Magazines can move by changing their contents, which will change their readership mid-term (and long-term). This can go faster than many magazines anticipate. The easiest way to change your style orientation is by changing featured brands and especially models. The departure of Hasegawa Jun from ViVi last year has caused great confusion among ViVi fans who followed her style.

[magazines are not only read by a very defined age category. Mainstream titles such as Sweet are read by women ranging from the 18 year old college girl to the 36year old mother with child. For reference, indulge in looking up the forum discussion groups in the Sweet Mixi Group.]
A typical Japanese fashion obsessed girl does not read only one magazine. She reads between three and ten. Each magazine has a very different and distinctive image of its typical readership, set of models, set of brands it displays, and values it propagates. Brands must understand that which magazines a brand uses or does not use creates highly complex messages to different consumer groups, forming the image of the brand. Ignoring this is to leave a huge chunk of the development of the brand image up to chance.
Furthermore, women who read a specific magazine tend towards reading a specific set of other magazines that conform to the same style group, or complement it. We have statistical information on this that shows the following points:

Readers of one magazine tend to cross-read other magazines, often from the same style group. To show an example, over 60% of readers of Non-no also read Mina, 63% of readers of Glamorous read ViVi, and 50% read Sweet. (see figure 1_03 and figure 1_04)
There are connections between style groups that form very distinctive patterns, and allow conclusions on how Japanese females combine styles and will absorb brand images and commercials presented in multiple magazine categories

Figure 1_03_READERSHIP VIVI The arrow shows the connection between Post-Gyaru style and High Fashion. Even though only a small percentage of ViVi readers read Vogue, about 20% of young Vogue readers read ViVi. Fashionistas in university tend towards either street style (spring, cutie, fudge, especially in art schools) or post-gyaru (ViVi, Sweet, Glamorous, Glitter) in combination with High Fashion titles (Vogue, Elle) and their younger sister magazines (Elle Girl, Vogue Girl). Even though only a small percentage of ViVi readesr are fashionistas (most are followers who imitate mainstream style choices to blend in), the ones who are are highly influential in networks, nearly all of them own iPhones and follow or write fashion blogs.

Figure 1_04_READERSHIP GLAMOROUS This map shows the fascinating fact that 63% of Glamorous readers are also reading ViVi. Such a high percentage among young female readers allows for some interesting marketing strategies to be executed. Imagine an advertorial in ViVi for two months, followed by a tie-up in Glamorous the following month with a slightly altered messaging, using a different art director and a creative approach for the visuals. 63% of the Glamorous readers will be aware of the messaging from the last two months in ViVi and will now experience, again, exposure from a brand that they will perceive as increasingly relevant to their style. The message will be much stronger and more sophisticated by using two magazines, than by only continuing the ViVi advertorial. Such highly targeted messages are only possible if the cross-readership among target consumers and their magazine lifestyle paths are know.

Word of mouth spans different magazine groups. This means that readers of one style group will often be informed by others about the contents of the magazines that they do not read themselves.
Awareness of the messaging of different style groups is very high, the more stylish and fashion-conscious the person is, the higher the understanding of the specific messaging and the presence of brands within the magazines.
Magazines are associated not only with styles, they are associated with brands, shopping districts, and shopping complexes. As an example, the Mote-Kei Magazine CanCam is heavily associated with the department store Marui, as Marui features most of the brands that are presented within the magazine pages.
Female consumers "graduate" from styles and magazines, only to pick other magazines that form a logical taste development, vis-a-vis life-stages in the Japanese society. When a life-stage ends (i.e. university time) and another starts (shakaijin, becoming a working member of society) then the magazine of choice that now tells you how to dress for that life stage changes too. As an example shown in figure ... a common path is Seventeen (high school) to CanCam/Ray (university) to AneCan (early office lady stage, just entered the job) in combination with Oggi/Classy (conservative office lady style) and in combination with Glamorous (for more eye-catching "off-time" outfits), to Domani (late 20s to early 30s) and finally Story (after marrying a rich husband) and 25ans. The path described is a process of more than 15 years.
Magazines evolve. 5 years ago, Mote-Kei Magazines (the old sister style) with Ebihara Yuri (Ebi-Chan) were considered the mainstream taste. Within the last 5 years there was a heavy shift towards a little more assertive style group with Post-Gyaru style (Gyaru influenced fashion and hairstyles that focus more on the cute side of this style influence, making it socially acceptable to wear) that emphasizes bringing cute elements into adulthood, something that people call "otona-kawaii" (adult cuteness), represented by models such as Rinka and Hasegawa Jun. In the last two years celebrity styles from abroad, inspired by American series such as Gossip Girl, The OC and The Hills, have had a strong influence on the fashion scene, culminating in the development of a whole new category of magazines (Glitter, Gisele, Elle Girl, Vogue Girl). In order to get the messaging right and navigate proficiently through the codes and associations presented in the magazines, companies must keep themselves continuously updated on recent developments within the Magazine worlds. The key lies in understanding how the consumer is perceiving and using the magazines.

Taking all these observations together, they form something we call a lifestyle-path. This is like a chosen "menu" of Magazines that are consumed in complex combinations over a consumer's lifetime. The messages absorbed from these media lifestyle paths profoundly influence the perception a consumer has of the brands featured within them (or not featured within them).

We hope to show brands the complexity of the market and at the same time the simplicity with which you can accurately navigate through all these styles if you embrace the structures and styles in a holistic and not in a simplified way.

To summarize, in Japan, the terrain is more complex and extensive, but there are also more detailed maps out there, and they tend to be amazingly accurate. We encourage brands to make full use of those maps to navigate through the possible style groups and select the ones that offer the best potential to translate and interpret a brands brand message and DNA in the Japanese market.

Social proof - what is behind the desire for feeling safe in brand choices?

2011-04-13T03:04:00.000-07:00

ViVi 03/11 page 31

Magazines are not just pages for advertisements, they are different worlds, very distinguished environments, and readers expect their magazines to present them with inspirations that fit their styles and models they aspire to. Ignoring these expectations will create tie-ups that lack resonance, that do not generate interest in the brand, and will ultimately produce a negative brand image. It is like going to a party in the wrong dress.

The true power of social proof can pay big dividends in your attempts to persuade Japanese consumers to take a desired course of action. The key in Japan is to understand what is counted as social proof and to see that for a person following a certain magazine, that magazine is considered social proof and the message is relevant to her, while another magazine is not.

Unlike in other countries where advertisements are mostly intended to establish an abstract brand image, a successful communications strategy in Japan is focused on one thing: the legitimization of the brand.
Young Japanese fashion consumers—particularly females—only want to buy brands that are seen as "correct" or "socially acceptable." Girls want to wear legitimate brands because that gives them the assurance that no one can criticize them and they will not upset the social order. Although this consumer insight sounds somewhat extreme, it is only that Japanese consumers are just much more concerned with the social aspect of their fashion than their counterparts in other markets.

We want to focus the attention of brands to the highly important comments that we picked up in every discussion on brand images that we ever hosted. The following quotes are representative for what we heard in many different versions, yet with a clear underlying message:

1) They do not advertise in MY magazines, so I thought the brand is not for me.
2) They use models that I don't like and can't relate to, so I don't check out their offerings.
3) My friends don't like the brand, so I am not inclined to every check it out.
4) They advertise in so many different magazines, I am confused who they are targeting, so I don't consider checking out their products."

Let us translate the above in more detail. What are the feelings behind these statements. But please remain aware of the fact that "we know that people's ability to understand the factors that affect their behavior is surprisingly poor. In asking themselves, 'What would motivate me?' they might well have discounted the very real influence that others would have on their behavior." [Goldstein, Martin Cialdini (2008): Yes!]. The following accounts are explanations of social dynamics, often complex, and many times not understood by the consumers themselves. Different consumer segments might also have different reasons. The ones below are examples.

1) I chose the magazine because I realized that if I follow this specific style in my network, people will react to me in a certain way. I have to follow the style propagated in my magazine, in order to be sure that others will see me following that specific style that has the desired effect (that I found out will happen). If I wear a brand that is outside this style world that I decided makes me feel comfortable, I run the risk of being criticized, or that my message gets diluted, that people think I am a different style or not oshare. That might ruin the effect, so I am afraid. I don't feel safe and comfortable choosing that brand.

Elle Girl 2011/03, page 31

2) I know that certain people like the same models and how they dress, and more importantly, what roles they play in my networks. If I chose brands that those models endorse, I can be pretty sure that the majority of those friends/people in my network who like those models, will also like the brand, because they will feel like me about it. So I can feel safe choosing the brand. I can predict the development of the brand in my network if this model is wearing it. Certain people will like it. Then I can decide if I want to be like those people. If they chose too many different models, then I will get confused. Who will like the brand? Who will wear it? Other people will feel confused, too, so it becomes a social gamble. I feel insecure, so I don't choose the brand. There are other brands out there that are cute and my taste, that do not produce that insecurity.

3) I talk with my friends everyday. My relations with them is good, but I had the experience before, when I did something that upset them, that they stopped calling me, or treated me with distance. Other people saw that and joined in. I am very afraid of being left out. If I show too much individuality, then people might stop liking me. That might or might not be true, but I don't know. It stresses me to just think about it. I want to talk with my friends about the brands I like. It's so much easier if I choose brands that are safe. You know, there are so many brands that are considered safe, they do it right in magazines and with the models, why should I care to choose from the ones that produce confusing messages and are criticized by my friends.

4) If I am confused about who they target, then others will be confused, too. That makes me feel so insecure. If I would wear the brand, others might get the image that I am not oshare or I don't know what I am doing. I love the social position I am in right now, so I don't want to risk that. My friends criticize brands pretty fast when they (the brands) do a mistake. I want to purchase a brand that does the right messaging, makes no mistakes. I want to trust the brand, that it will not do something confusing or stupid in the future. You can feel that, you know. If you look at the magazines and how they do advertisements. You can see if they know what they are doing, if they understand the way we think. If they do, I feel safe. I can choose the brand anytime and it will be no mistake.

Fashion Magazines in Japan as sophisticated brand building tools

2010-10-08T09:39:00.000-07:00

Fashion magazines in Japan are not an objective review of market offerings based on expert analysis nor are they about statements. They are sources of raw information expertly selected, following a set of seasonally changing rules within a given subculture – an authoritative source of information. It is a practical top-down legitimization of fashion brands, and how to coordinate and wear them.

[
[note] parts of this article are heavily based on the theories and articles from W. David Marx, who assisted in uncovering many of the dynamics described in this text.
]

Those with money can choose more freely which subculture they wish to belong to. Being able to choose (and afford for that matter) certain luxury products, means being able to belong or to produce the image that you are able to copy more complex social codes. Japanese consumers study magazines to be educated enough to conform to the rules of the season and interpret them according to the demands of their networks. Magazines readers want to pick an individual style out of the framework of safe and socially acceptable clothes selected with media approval.

In Japan, buying a certain magazine gives others the impression that you are interested in the specific style promoted by the magazine (mote-kei, post-gyaru, girly, high fashion, to name a few). Wearing a certain handbag brand does not define your personality in the eyes of others, but belonging to social groups, being 'oshare' (trendy, fashion-conscious) or belonging to a life-stage (mature, student). Of course, these messages are not universal and often function only in combination (a certain handbag in combination with certain clothes).

The complexity of the combinations possible and the grade of understanding them gives others who are adept at reading the signs a grade of understanding how "oshare" the wearer is or what social group she belongs to. In order to be able to judge these signs, consumers of social segments have to constantly keep themselves updated by reading magazines, blogs and other sources that "inform" them of actually practiced trends and their possible combinations. A person considered oshare by people who keep themselves informed successfully, is able to navigate safely and easily through the complex system of messages.
There is involved both a positive and a negative experience in the fashion imperative of Japan. That is the desire and feeling of belonging, and the fear of standing out or even being cast out of a group, respectively.

When the consumers follow authorities (magazines, famous brands) it decrease the amount of social choices or social situations, freeing them from having to constantly worry about being judged negatively and wear what they like in a safe context. Without a safe context living in a highly structured society like Japan may cause substantial stress. Generally speaking, the only consumer products that succeed in Japan are the ones that have been legitimized by some sort of authority. Mass media acceptance is solid proof that a brand is among the safe choices and is socially relevant.

HOW SHOULD WESTERN BRANDS USE THE MEDIA?
Brands are often not aware of the ubiquitous usage of styles for messaging and their meaning in Japan. The important thing is to understand how this system works, how foreign brands are combined with domestic styles, and how much of their original brand image is stripped away or dispersed, and replaced by perceived images of status and ownership groups.

Which group of people wears a certain brand? Which group of people usually follows this style? These images are largely formed also by the magazines that the brands choose to advertise in. Japanese consumers simply assume that if a brand advertises in a certain group of magazines (that are representing a certain style) then that brand is to be identified with the readers and styles of those magazines. Simply put, if a brand advertises in magazines for young “girly style” magazines then the readers will assume that the brand is for young girly Japanese consumers. Use a certain model for endorsements of the brand, and women who identify with the model will identify with the brand. These dynamics are also known in the West, but in Japan the categories are more clear cut and therefore allow a much clearer identification of styles and user groups. As W. David Marx has put it in one of his latest articles for Neojaponisme, "Real Harajuku Girls, For Real":

“In Japan, you can often judge a book by its cover. Consumers embrace a total, well-defined “taste culture” in which to consume, and once inside that group — usually defined by a specific magazine — they buy goods very faithfully to that culture. We should also remember that there is a certain predestination in which “taste culture” consumers gravitate towards.”

More important than the image it creates when a brand advertises in some magazines is the image that is created if a brand does NOT advertise in a certain magazine. For the readership reading that magazine, the brand will have no relevance and will not be able to change the messaging to those readers. What will remain are preconceived ideas that the consumer will receive from within networks through word of mouth.

Now it gets more complicated than this. A typical Japanese fashion obsessed girl does not read one magazine. They read between three and ten. Each magazine has a very different and distinctive image of its typical readership, set of models, set of brands it displays, and objective. Magazines are categorized into style categories, and certain styles form popular combinations with other styles (i.e. post-gyaru with high fashion). Others are on opposite sides of the spectrum, hard or impossible to align.

Brands must understand that which magazines a brand uses or does not use creates highly complex messages to different consumer groups. The effect heavily contributes to forming the brand image. Ignoring this is to leave a huge part of the development of the brand image up to chance and to dynamics within networks.

So where is the problem for Western brands using Japanese media? Most high end brands advertise selectively in high fashion magazines that give the brand legitimacy, but are not read by the majority of the young consumer audience. They place their brand’s products in magazines advertorials, where the location and style presented has nothing to do with the brand image originating from the country of origin.

Moreover, many high luxury brands advertise and select advertorials only in magazines that are perceived to have a readership of potential buying customers. As Kapferer emphasizes in his book “The Luxury Strategy”: “...don’t advertise to sell”. Luxury brands leave the complex process of building up a brand image among young consumers to chance. They miss out on the opportunity to convey the brand’s story, the narrative, and image to young consumers. Consequently the “akogare” (the looking up to) to the brand is constructed within networks, and does not originate from the brands themselves.

Depth and context are perceived as being minefields for Japanese brands. But foreign luxury brands operate within this context and are mixed in with the Japanese narrative. Broader cultural context could make adoptions of foreign brand narratives difficult. Although they do not do so, Japanese magazines could easily convey messages of heritage, and references to the history of brands or their more complex meanings and statements. Popular Japanese magazines are not interested in brand building and foreign brands do not use them as brand building tools. But if used correctly, magazines in Japan are a highly sophisticated tool for building up brand images. You have only to understand clearly the dynamics.

The life of a brand or its brand image is simply not sustainable without a deep narrative that becomes embedded in the cultural landscape. The question is how to construct a narrative that goes beyond the dichotomy of East/West status markers. How are we to create narratives with depth, intimacy, and relevance that leads to sustainable outcomes?

What we are proposing is that the way to build up a brand image is not exclusively through abstract statements, a relatively foreign concept to Japanese consumers that they readily ignore. Using magazines successfully is about becoming part of the machinery or the flow of the fashion consumption dynamic.

To illustrate: Using a half-Japanese model is a key tactic of Japanese brands. They look foreign enough to enhance the image of the clothing but close enough to the Japanese consumers to send a message of commonality. Also, half-Japanese models tend to be more extroverted, embodying “akogare” (someone to aspire to be like) not for their looks, but their attitude vis-a-vis a highly structured society that leaves women with limited choices. A model such as Hasegawa Jun embodies this “freedom of expression”. Yet foreign brands do not consider the use of half-Japanese or Japanese models for brand building, as it is still considered not appropriate for Japanese or half-Japanese models to represent a brand whose aura is originating from the West. Many Japanese consumers consider Western models as superior to Japanese ones and would lose some sort of respect for the brand as a status symbol if Western brands would use Japanese models for brand advertising. Especially women reading high fashion titles such as Vogue, Sou-en and Spur would not be fond of this. At the same time it is accepted to use Japanese and half-Japanese models in advertorials wearing items from Western brands. In this case the Japanese woman "consumes" the brand, but does not "represent" it. The statement that a Western brand should never let itself down to the point where it "allows" a Japanese woman to represent it is voiced by the majority of Japanese consumers, not by Western observers. The issue seems to be complex and deeply rooted within the roles that Western brands played in the 80s and 90s in Japan and the way Japanese women see themselves vis-a-vis the West.

Japanese magazines use Japanese models (Senzoku system) in order to create sympathy and self-association between readers and models. Japanese OLs and students for the most part have no fantastical aspirations towards the artistic side of fashion. They are happy to see themselves in the shoes of Ebi-chan. Aspiration means seeing yourself in a slightly elevated version of your own reality (standing on tip-toes, “Se no bi o suru”). A heightened version of yourself, basically.

Each magazine’s visual approach not only creates the proper environment for appreciating the clothes/bags, but submerges the reader into a slightly upgraded and aspired to version of his or her own reality. It is verily not an abstract image that creates a complicated personality association.
Magazines are a reference point offering basic information. After that you need confirmation from your networks. This is how brands can reach the tipping point to becoming legitimate. When a certain threshold is reached within a group, a tipping point might be reached. What follows then is fast and thorough adoption. We advise brands to think differently, think social, in Japan. You must look for thresholds of tipping points.

Brand Narrative Marketing

2010-10-06T20:44:00.000-07:00

Japanese consumers perceive brand images in a different way from Western consumers. The image of who is using a brand - having clear and consistent associations with the right user group - is the most important attribute of a luxury or premium brand in Japan. Japanese fashion lables are very adept and proficient at using the Japanese media and models to create these associations. Foreign brands are often not even aware of the ubiquitous and complex messaging sent out by using certain magazines in favor of others. Further, as import brands they have a stronger role as status markers and therefore operate under different premises than Japanese brands.

Brands have to be aware of their social role in networks in Japan. Unwillingly or not, they participate or are passive participants in a complex and sophisticated game of styles and accessoires that is played by the consumers and the media. Not understanding and influencing these dynamics can be risky, especially on the long run.

Our brand narrative audit performs two important tasks. First it updates a brand on what Japanese consumers really think about it, their conversations. Instead of simply analyzing the status quo, we take a look at the potential of the brand, on how it can be developed for both short-term to impact sales and on the long-term to build a consistent brand image, and for luxury brands, how to create “the dream”, the desire to purchase as the product is yet out of their reach. Second, we explain the dynamics that have led to the present brand image and how the actual media usage influences this.

EXPLAINING CONSTRUCTION OF THE BRAND IMAGE
In the Japanese context, brand images, if questioned, often produce opinions about who is considered the main customer, not about the personality or abstract values of the brand. This means that the first immediate image that comes to mind when hearing the brand name is often an image of the perceived customer group. In the surveys that Japan Access has conducted, about 70% of the answers on brand image formulated in own words have been sentences such as "a brand for OLs" or "for mature women", "for students" and not about the the culture or the personality of the brand.

The personality of a brand does not have any real relevance to most social networks of Japanese consumers, and is thus conveniently ignored by magazines and consumers alike. Japanese do not understand abstract brand images. They do not even bother trying to understand it. This is one of the principal reason why brand advertisements do not work well in Japan.

Foreign brands are predominatly consumed as handbags and accessories. Since 1996 when the luxury market hit its peak in Japan, looking at the distribution of market sales, the ratio of clothes went down gradually while the ratio of handbags went up steadily. It is a common pattern now for import handbags to be combined as status or taste markers with Japanese clothing brands and fast fashion (uniqlo, Forever21, H&M), to add a touch of “class”, making the purchase of an expensive bag an economical venture. It is important for foreign luxury brands to understand how their brands are combined with domestic styles. Brands have to navigate under this premise and understand that their brand images and narratives become fractured in Japan, often devoid of any meaning. Their luxury items become status markers, not only of financial wealth but especially signifiers of belonging to social groups.

In Japan, a strong self-image is often built up by giving a consumer a socially safe choice, a choice that is legitimate and has relevance to their lives. Japanese consumers are heavily influenced by the opinion others have about them within their own relevant networks. This might include school, university, the company, their friends and family. Most Japanese are adept at categorizing themselves into style categories, such as gyaru, girly or mote-kei (onee-kei or older sister style). Alone their choice of magazines often makes it possible for themselves or others to judge and define what style segment they belong to. With choosing a style come expectations from other consumers following similar styles.
Buying a certain magazine gives others the impression that the person is interested in the specific style promoted by the magazine. Wearing a certain handbag brand does not define your personality in the eyes of others, nor does it make an abstract statement of values, but shows belonging to social groups, of being 'oshare' (trendy, fashion-conscious), or of belonging to a certain life-stage (mature, student). Of course, these messages are not universal and often function only in combination (a certain handbag in combination with certain clothes).

The complexity of the conbinations possible and the grade of understanding them gives others who are adept at reading the signs a grade of understanding how "oshare" the wearer is. In order to be able to judge these signs, consumers have to constantly keep themselves updated by reading magazines, blogs and other sources that "inform" them of actually practiced trends and their possible conbinations. Persons considered oshare by people, who keep themselves informed successfully, are able to navigate safely and easily through the complex system of messages.

The perceived customer of a brand is an image that is often entirely arbitrary, stemming from problematic communication of the brand in the Japanese market, missing relevance to customer groups or not advertising in magazines read by the questioned person. The Japanese are less likely to form a positive self-image about using a brand if the reflection of the brand is not associated with their own peer group, or if the being seen owning the brand has no relevance within their networks. So in order to construct any relevance within a specific network, you need to align the perceived customer group of a brand with the targeted network.

Let us recapture: using abrand causes a social reaction in Japan. So the aspect of the brand when seen owning it is extremely potent. Knowing what others might think of me when I use a brand or wear it, constructs my image of what I believe others will think about me wearing the brand, and thereby constructs my self-image when owning it.

models and the advertising context and contents create the brand personality in the first place in Japan. Brand personalities in Japan are much more versatile, and customers most of the time do not consider it as a big problem if a brand tries to change the brand image. But instead of heavily influencing the brand personality, which Japanese consumers have difficulty relating to, a model influences more the reflection, the relationship and the self-image in Japan. If the model's personality or image can be aligned both with the preferences of the consumer as well as being consistently associated with the style that the consumer has chosen for herself, thereby creating an effect of security, of not making a choice that would be considered out of style or strange, then the brand is considered a relevant brand.

Now we have two proplems. The personality of the model is in most cases not known to the marketing departments of foreign luxury brands as the choice is often made by media agencies with motives that deviate from the goal of creating a consistent brand image (which is a concept that is foriegn to start with for the people that handle the media account). The second problem is that a consistent brand image is not understood in an abstract sense as in the West, of "values" that fit, but is more tangible, like the image of a young woman in a life stage of the consumer as the model and the perceived reflection, who wears it actually.

To summarize, advertising and marketing in Japan should emphasize and explain one thing: who is the brand for? Who will wear it?

Does English language ability influence brand choices and shopping behavior?

2010-07-10T11:19:00.001-07:00

Not as much as I thought. There are slight differences between students who say they can't speak English at all or only a little, and the ones who state that they can speak highly advanced or native level English.

Among women with a high English skill level, some brands are rated slightly higher (Prada, Bottega, Coach and Ralph Lauren). The last two were expected outcomes, as they are American brands. Lower rated brands are Chloé and Burberry, Miu Miu and Samantha Thavasa. But the differences are only slight ones (with Burberry being the exception. It is rated much higher among non-speakers). English speakers clearly prefer Omotesando over Shinjuku and do not like Ginza.

The results do show, though, among other categories. If we ask students for who is influencing their shopping behavior and opinion formation, women with high English skills rate the following categories significantly lower: friends, students, people on the street and magazines. Non-no is read less, the self-confident ViVi is read more frequently.

Judging their own personality, as could be expected, English speaking girls rate their own cosmopolitanism, creativity and individualism much higher. They tend to dislike Ebi-Chan and do not think so much that a handbag defines your status. Seken and stability have lower priority to them. They believe much more in upward mobility, will not change their own style so much when becoming a working woman, and do not feel the urge to purchase much more clothes when enetering the workforce. But, foreign brands are more important to them.

Let us summarize. Women with higher English skill level are, as expected, more sophisticated, rejecting the social constraints and, in part, the dependency on social rituals and role models as given to them by mote-kei magazines. They are less influenced by what others think of them. BUT, this does not mean that they shop less, or that their brand choices are so much different. They have been subject to different influences, but the real difference is among how they perceive themselves and why they shop. Learn English and shop with self-confidence and for yourself. English skills are not an exit strategy out of the consumer mania, they just change your attitude.

Mote-Kei Ray, JJ and CanCam

2010-07-10T10:14:00.000-07:00

In case you always wondered what the exact difference is between Ray and JJ readers (two mote-kei magazine titles). JJ readers consider themselves to be more creative, tend to dislike cheap brands such as Samantha Thavasa and F21 (also a lower ranking for Coach, the mainstream brand number one) more than Ray readers and are more fond of Bottega Venetta and Marc Jacobs. A dislike for Ikebukuro and higher rankings for Isetan hint at a slighlty more sophisticated taste. The usual connection between Zara/sophisticated and F21/less sophisticated can also be seen here. Interesting is also the fact that JJ readers read more ViVi than Ray readers. Ray is the typical magazine for university students. It has a good image with boys, the clothes are considered "safe" and cheap, also very easy to incorporate into your wardrobe. JJ is slightly more mature than Ray, the clothes have more class.

Now let us compare Ray and CanCam. Here we find something intreresting. There is nearly no difference in readership. Two things can be seen (if you really look for something): CanCam readers dislike F21 more than Ray readers, and think of themselves as slightly more creative. They also tend to read less post-gyaru titles such as Sweet and ViVi. The brand choices, preference of shopping districts and even the evaluation of what makes a luxury product, are identical to the point where it gets scary.

Louis Vuitton lovers - what kind of students are they?

2010-07-10T09:03:00.000-07:00

In case you have always wondered, who are those students who love Louis Vuitton so much? Are there profound differences to the average student among elite universities? In the case of Burberry, we can say, no. Burberry lovers blend in. Completely. There was not one statistically significant difference, only that they tend to shop a little bit more often in Ginza than the rest of the crowd. And tend to read more CanCam. But the mighty brand from Paris? Here we see another picture.

Before we go into the details, lets start with the most prominent differences. LV lovers, they tend to value more highly the following brands (in that order): Gucci and Dior, and D&G (who would have thought that?). Brands are rated higher in general, but Samantha Thavasa is rated more highly, too. The brands that are not rated better are Paul Smith, Ralph Lauren, Commes des Garcon and YSL. The only statistical significant difference in where they shop is Shibuya and Shibuya 109. They read more ViVi, CanCam and the other mote-key titles such as JJ and Ray, and also Non-no (+11%). Famous people and celebrities play a stronger role in their opinion formation, and (!) they admit that widespread brand recognition and the fact that everybody has the same brand play a role in their purchase decision of a luxury brand.

When it comes to the way they judge their own personality, they say they judge women by their handbag, they want to be more trendy than the average student, and they value brands highly in general. Ebi-Chan is rated above average, as is the desire to buy more when becoming a working woman.

As Hermes is also rated higher than average, we can see clear status consumption, and aspiration towards celebrities. Further we see gyaru influences, and a fixation on strong and recognizable brands. Are we surprised with the results? D&G did surprise me, actually.

Now, to prove the fact that it actually does not really matter if it is LV or Gucci, the other status brand that you tend to buy in high school when even the most fashion-unconscious girl sitting next to you takes out her brand wallet during class, lets take a look at the differences of Gucci lovers and LV lovers.

It is almost scary. There is no difference. The only apparent visible difference is less Gyaru influence, meaning less fondness for Shibuya 109 and a better average evaluation for Ginza. the choices of magazines are exactly (!) the same. Analyzing the profiles in more detail leaves me with a very vague suspicion that Gucci lovers are from households with a little bit more money and older mothers who tend to shop more in Ginza and Omotesando Hills. The differences are not strong, though.

Brand Survey among Students - ViVi readers

2010-06-06T22:40:00.001-07:00

Discovering small details is the benefit of doing part of the data entry yourself. Filtering results for a few hours and seeing patterns in opinion formation among students. Magazines in Japan have distinct personalities. As with persons, analyzing them more thoroughly can yield interesting results. What is the difference between JJ and Ray from a brand consumption aspect? If you read ViVi, what other magazines do you read? What combination of magazines represents best the main stream?

VIVI READERS. Let us take an example to illustrate the details you might be able to deduct from filtering. Women who read ViVi number 130 out of a sample of 553 female students, average age 20,2. Their rating of handbag represents the main stream opinion of young Japanese, with 1) Hermes, 2) Chanel, 3) LV and Prada together, 5) Gucci and 6) Bottega. No big surprises here.

brand images (+2 very positive, 0 neutral, -2 very negative): 1) Chloe 1,2 2) Miu Miu 1,2 3) Marc Jacobs 1,2 4) Dior, Prada and Chanel with 1,0 7) LV, Gucci and YSL with 0,9. Louis Vuitton does make it into the top 10, which is not the case for the overall sample of 553 women. Armani scores lowest among the European power brands, while it has to be noted that many Japanese take Emporio as the representation for the brand image and not Giorgi Armani. Popular fast fashion brands are uniqlo and Zara with 0,8, Gap scores lowest with 0,3.

Shopping districts: 1) Shinjuku leads with 1,4 2) Shibuya 1,2 3) Harajuku and Omotesando 1,1 5) Ginza with 0,7 6) Daikanyama and Ikebukuro with 0,6

Departments stores: 1) Lumine 1,6 2) Marui 1,4 3) Parco 1,3 4) Isetan 0,9 5) Laforet 0,8

What magazines? 40% read Sweet, 34% JJ, 32% read Ray, 30% CanCam, 22% non-no, 19% an-an, 18% Glamorous, 18% mina, 16% Glitter

What we have here is the new main stream. ViVi and Sweet readers, post-gyaru style, otona kawaii (mature and cute) as represented by Rinka, the 36 year highly popular model who just recently got married. With 48.764 members in the mixi community (a Japanes SNS), Rinka is far outshining once so popular Ebi-Chan (Yuri Ebihara) with 28.774 members. ViVi gets a membership of 29.113 while CanCam scores 25.929. Magazine sales also pinpoint the change from mote-kei (the style to attract a man) towards the more sexy otona-kawaii style (individual sexy style, not to directly attract men, more a statement of a girl's individuality, fashion for fun, taking the "cute" attitude and your own style into adulthood).

Cultural Values

2010-05-28T01:29:00.000-07:00

A very elegant and decent brand building commercial by Louis Vuitton. One sentence strikes me: "A journey does not only show us the world, but how we fit in." If there is one aspect that luxury companies have neglected in Japan, then it is the cultural context, to study the setting, the broader context, societal rules, finer shades of meaning and semiotics. Luxury is social, it is cultural. Brands tend to ignore cultural changes and the meanings that brands can construct within them. "As long as it works, ..." the message of A CEO from a luxury company selling with great success in the Japanese market. But why does it work? What does this mean? What do customers think about your brand, about your products? If you would ask ten companies if they are sure about what their own customers are really thinking about them, what associations they connect with the brand, you would probably get ten negative responses. Marketing experts in Japan tend to guess. They give up on the possibility to really understand the dynamics that govern luxury consumption in Japan.

Understanding what position the customer holds in the brand image, what he thinks and feels when purchasing, what impression a customer has when she clings to her bag to provide her with social security, with acceptance within her peer group network... There are many opinions, many surveys that barely scratch the surface due to organizational constraints. Nearly no one makes the effort to ask the customer. Directly. Focus groups are not the same as engaging in conversations.

Luxury brands should take the journey themselves, into the shopping jungle of Tokyo. Enter Lumine in Shinjuku with a student and ask her to describe which shop means what to which customer. Ask the office lady during lunch time, in which shopping district she shops for her favorite brand bag and why she is not fond anymore of LV or Gucci, but now prefers Chloé and Marc Jacobs. Ask her why. Ask her when it happened. Ask her what her friends are thinking, what magazines they read. Enter their minds. Find out, discover where your brands are positioned in the world of your customer. Make the journey.

There is a way to enter the minds of Japanese consumers, to engage them with the brand, to make the brand part of their lifestyles, thoughts and dreams. To do so, you have to understand the journeys they want to take, the daily cultural patterns, their dreams and the power of social gratification and stratification at work every day, through all age groups and parts of society. There are patterns that want to be discovered. Don't spend your time in the office. Start the day as a marketing expert by drinking coffee in Omotesando, watch people, talk to them, engage them. Say goodbye to corporate structure and educate yourself, taking the best source available: the consumers.

HNWI survey 2010

2010-05-24T23:14:00.000-07:00

Accessing wealthy clients and marketing to rich people in Japan represents a major challenge. In a shrinking market, knowing how to deal with affluent consumers who often form the solid base for a brand, can become an essential asset.
In order to understand how rich people spend, it is important to understand brand images. Japan Access will conduct a study which is the first to take a detailed look on the way HNWIs in Japan perceive luxury brands, hotel brands, high-class travel agencies and concierge services.

The specificity of the survey is summarized in the following points:
- We are accessing a network of 7,000 HNWIs which was built up over a course of 8 years through personal interaction by a Japanese HNWI specialist. The relationship of trust that our Japanese business partner has with those rich Japanese enables the execution of the survey.
- The length of the survey would normally make it impossible to make HNWIs answer it (it takes longer than 1 hour to fill out). In our case, the HNWIs have agreed to support our study and invest their time to provide us with detailed information on their consumer behavior.
- Sensitive data (assets, income, real estate ownership), that was accumulated over the course of 8 years, will be connected to the information we will gather through the survey. The results will be anonymised in order to protect the privacy of the respondents.
- The survey includes hand-written essays, hand-written statements on brand perceptions, and a personality analysis.
- We are able to interview and survey the same individuals again, making it possible to construct longitudinal studies.

We selected 500 individuals from the 7,000 HNWIs resulting in the demographics shown in the figure HNWI_SURVEY SAMPLE.

Instead of constructing the questions based solely on our own expertise, we welcome the input of industry experts.

Through a cooperation of the industry with our researchers, it would be possible to create a win-win situation. Parties who are highly interested in questioning Japanese HNWIs will be able to influence the questionnaire to fit their specific needs. We would be able to get a clearer picture of what questions are of high value and relevance to the industry.

The following table provides more details on the categories of the questionnaire and which specific questions we are planning to include.

Brand Survey discussion

2010-02-23T08:20:00.000-08:00

Student Brand Perception Survey 2009

2009-11-30T23:29:00.000-08:00

At present we are conducting an in-depth student survey for research purposes at Japanese elite institutions, meaning prestigious institutions such as Tokyo University, Keio, Waseda, Aoyama Gakuin, Hitotsubashi, Sophia University and Meiji Daigaku. The survey takes an in-depth look into brand perceptions, consumer behavior and the lifestyles of the future elites of Japan. As an incentive, the survey includes a lottery in which participating students can win a shopping experience.

This shopping experience will be conducted in Tokyo´s most popular shopping districts. Winning students can use the budget to purchase from any brand they chose. We will accompany and inquire them in further detail concerning their shopping behavior. The winner's IDs will be published on this blog on January the 7th, 8 o'clock in the evening.

As the collected data is enormous, it will take approximately 2 months to publish the first preliminary reports.

抽選に当選した方をこのインターネットサイトで1月7日、8時に発表します。参加して頂いた方に本当に感謝しております。

Superflat Monogram, connecting to the young

2009-11-05T18:16:00.000-08:00

This is nothing short of genius. The beats are decent, the whole thing in Miyazaki style, cute enough for to hook every young girl, yet aesthetic and cool enough for older audiences. Playful and light, with a drop of fantasy here and clear references to Alice in Wonderland there. So here we get it, LV makes the Japanese version of Alice. Fantasy in this country is born through the brands on Omotesando, and in the end, all is shared over the city through your mobile phone. Symbolic exchange (yes, Baudrillard) through the screen. In the moment she has sent the pictures out to her friends, the fantasy became reality. And yet part of the dream stays only with herself. LV takes her on a trip. That young girl can now aspire to something, when she is older, she will be able to purchase into that dream...that is, if it is not damaged along the way by overexposure of Shibuya Gyaru who are not so much Murakami style.

[ comment start
I wonder if someone shares my perception that the most distinct "Japanese culture" element in this clip is the moment when all her friends receive her message on their mobile phone (seeing scenes in Shinjuku, Shibuya, Suidobashi Tokyo Dome, in front of a juku/Japanese cram school with 進学 written on the window). I think this is a very accurate observation of youth culture and the way that their world revolves not only around their mobile phones but through the immediate possibility of sharing an experience and connecting to the world around them. This experience without her friends would be isolated, apart from the group, and not real. Sen to Chihiro from Miyazaki lets Chihiro experience her fantasy alone. Only her friends in the other world understand her. Very indidvidualistic, even western. But this here is different. You experience individuality through adhering to a group norm, share it with the community and get the feeling of setting yourself apart (always in the group) through staying ahead on a trend, that is again defined by group norms. It´s self-referential and presupposes changes implemented from the outside, external influences (for example in the form of a strong brand with authority, like LV).
] comment end

The sophistication of this advertisement is difficult to align with some of the customers that exhibit the brand openly. Yet, is it a contradiction? Misuse of a brand's image for subcultures not directly associated with the intended brand image, are not always bad for a brand. More thorough semiotic analysis of the media dynamic would be necessary.

Yesterday I had a talk with a university student, highly eduacted, from one of the prestigious private big names, who told me something that made me think. When she entered University, she started a part-time job, and earned her own money. It was the first time that she thought about its value, and what she would like to spend it for. It was earned, and she started to question the value of just spending all that for a handbag from LV. It was not that she had less money than before, when she aspired to own one. It was that she saw no reason to make an effort to obtain it. As long as it was easy and without emotional investment from her side, she was willing to own a LV bag. The question is now how to give the brand enough emotional value in order to give them enough reason to make that effort.

What surpised me even more were the contradictory opinions of a university student and his girlfriend. She was convinced that her boyfriend would not like girls who own a LV bag, considering them to be less individualistic. Yet his opinion, if asked seperately of course, was that girls who carry such a bag are female and sophisticated. Wouldn't be the first time that couples have different perceptions about shared values. But it starts to interest me if you can align the images of male and female consumers in Japan, even from the same social segment, even university. I was wondering if the survey that I am about to conduct at the end of the month should also include male consumers and their image on certain brands. It seems to me that girls (especially highly educated ones who have the comfort of being able to lead a more independent professional life) are much more critical about the image of LV than their male counterparts.

I dont think a normal survey with both male/female participants who answer the same questions, would account for the complexity of the issue. What about doing it differently, by asking women for their perceptions on the brand and the (perceived) image it has on the other sex, while trying to find out the real image male consumers have of different female consumer segments carrying those famous bags.

On the philosophy of luxury, an Interview with Agenda Inc.

2009-11-03T03:23:00.000-08:00

I was asked by the Consulting Agency Agenda Inc. (an insight and thought-leadership partner for luxury brands) to comment on my conception of luxury in an interview. It can be accessed here. The interview was shortended for the blog, the full version can be read below. I have added additional comments and references into the text. [They are marked like this to make them distinctive from the main text body].

INTERVIEW WITH AGENDA INC., 03.11.2009
Helge Fluch is the founder of luxury consulting company Japan Access, and author of the influential blog, HNWI Marketing Japan.
The focus of his Luxury Marketing Blog is to showcase his research philosophy around luxury brands, while his consulting company Japan Access offers very specialized services in the field of HNWI marketing and luxury marketing, with a focus on the Japanese market.
Almost uniquely in the field he uses a range of sources to support his arguments; including Pierre Bourdieu, Baudrillard and other post-modern social theorists, and more contemporary references such as Currid’s Warhol Economy and Kapferer and Bastiens The Luxury Strategy. He also cites and recommends Japanese writers on luxury such as Tsuchiya Kochi, with his book “HNWI Marketing”, and Takahashi Chieko’s "The Seven Rules of Selling Despite a High Price. Luxury Marketing."

Recently, we interviewed him about his point of view on luxury and his work.

- What do luxury brands mean to you?
Luxury brands embody something for which humans have striven for many ages, since the beginning of humanity. It is the desire to create something that is essentially more, transcendental, out of the ordinary, and not necessary for immediate survival. Yet all human societies develop something that can be called “luxury” even if there is not a value/price mechanism associated with it. Religious artifacts and relics can be considered a form of luxury.
For me, luxury is essentially something social. It creates, as Kapferer and Bastien (2009) say, a social distance. Luxury does not exist without human interaction and it appears where human beings within a social context want to construct themselves a place within that society, in relation to others.
By analyzing luxury brands we can learn a lot about the structure and values of a certain society. Without a profound understanding of the society in which the luxury market is taking place, any conclusion may be vague, ambiguous, or even completely wrong.
My fascination for luxury goes beyond the mere social aspect. I adore excellence in all human endeavors, and luxury products - in my point of view - fulfill the human need, as mentioned above, to strive for something more than ordinary. I disagree with the notion that luxury is something “not necessary”. I think the human mind was made to create luxury items, and history proves me right. I would be very interested to see an exception to this rule.

- What do you think luxury brands globally can learn from Japan?
Japan is in many ways a very special market. Around 40% of all luxury items in the world are consumed by Japanese consumers, inside and outside their own country. In Japan, we can see how a developing country - in which social structures are broken up and recreated within a very short time period - uses material objects that have certain value associations in the West, to substitute for social structures and class differentiations that have disappeared suddenly (Chadha and Husband 2006).
To explain the way in which Japan has developed, though, we need more than that. Without understanding the history, the education system, the employment market, and the economical micro- and macro structures, no profound explanation can be found for the special role that Japanese consumers play when compared internationally.
Louis Vuitton has proven how to define a market and how a brand can become unbelievably successful by basically creating the social rules within a country. Similar things can and are happening in China, Hong Kong, and Singapore, and, as a very young luxury market, India. What is happening now to LV, with sales decreases of over 10%, is part of the dynamic and can be very enlightening for the processes within other developing luxury markets.
The dream equation, the difference between the perception rate and ownership rate, is a very fragile construct. Without a perceived limited availability, and by losing core customer groups, a luxury company can reach a market penetration that will become a problem for the aspirational value and the prestige of a brand.
Basically, what luxury brands could learn from Japan is to thoroughly understand and research the social dynamics underlying luxury consumption in new markets, and not just to be delighted by record sales numbers, blind to the cultural processes underlying this success that might some day cause the brand to lose ground within the same market, or internationally. Success alone is not enough. You should know why you are so successful, and the risks associated with it.
It strikes me what Yves Carcelle said at the opening of the LV flagship store in Omotesando in 2002:“This is not just a store, it is a statement.” Well, marketing experts should be sure to understand what exactly that statement will be on the long run. LV still sells immensely well in Japan, and we hope that the brand understands all the reasons for its own success. Only because you sell, does not mean you got all the variables right. In luxury marketing, brand value comes before shareholder value. So you have to think long-term.
[ comment start
The statement of Yves Cartell was printed in Zielenziger (2006): Shutting out the Sun, p. 150. The case of LV is interesting in many aspacts, as the cause and effects are often mistaken. LV is not just a logo that is overrepresented in the Japanese market, it is a brand with extreme overexposure that creates dynamics unseen in any market before. What happens in a society with over-emphasis of group-harmony and social consensus, where people go for saftey choices in order to adapt, or better, to not stand out. This can be considered a social experiment of before unseen extent. It can be argued that in most other countries a saturation effect would have led to an equilibrium much sooner than in the case of Japan. People interested in answering the question why? LV is so popular should read the following resources, which are all in Japanese (I am currently working on a summary of the articles that will be posted on this blog within the next 2 weeks): セオリー：有名ブランドの秘密 (the secret of famous brands)、theory2008 vol.3 KODANSHA Theory, リアル・リッチの世界II, ルイ・ヴィトンの法則―最強のブランド戦略 (The laws of Louis Vuitton. The Strategy of the Strongest Brand). See also my comments on the luxury report from McKinsey, and this article at Luxist.com.
] comment end

- How do you see the future of luxury?
I think luxury will become more diversified and will enter subcultures that we never thought would be susceptible for the concept. It will adapt a more international language of signs as the media will penetrate more and more of our daily lives, increasing the options for consumption tremendously. At the same time, losing sight of your own ethnicity and feeling lost in the global net of offerings will lead to a new-found importance for sticking to your roots, of preserving heritage. The real luxury companies of the future will be the ones that offer some form of legitimacy that goes beyond conspicuous consumption. Social dynamics that punish luxury companies for ignoring their own heritage take a long time. But they work anyway.
The future for the growth of luxury brands lies in Asia, especially in China and India. As these societies discover not only the possibilities of consumption but also exhibit the highest growth rate for rich people in the world, luxury brands will inevitably look to achieve growth strategies there. The question will be whether they can avoid some mistakes made in Japan. Of course you could argue whether the developments in Japan can be called mistakes. They produced a lot of growth for luxury brands. But times are different now, and developments in the rest of Asia could produce unexpected outcomes globally.

[the following part was not printed on the blog of Agenda Inc.]
- What are the beliefs that guide your work?
As I work I question my own values continuously while adhering to a certain philosophy of thought that is both structured and flexible. I try as much as possible to include contradictions and oppositional points of view within my theories in order not to fall into the trap of oversimplifying in order to reach an intended outcome. If you would ask me to describe my way of thought in one sentence, I would be inclined to go for “creative destruction leading to innovation”.

1) Marketing is no science. Marketing is not about facts. It is about tendencies, probabilities, all of them with a time component, meaning, subject to sometimes rapid change. Marketing can be about trying to figure out an approximate future, not about discovering reality. No matter how sophisticated the research methods, the results are always ambiguous, never complete, subject to change, and open for interpretation.
2) In order to anticipate this approximate future within the relevant universe of the brand, it is essential to look out for possible developments in the market that are hard to perceive. Those “disruptive cultural movements/tendencies” are often situated within subcultures, lying dormant with a potential, until some combination of external and internal factors lead to a critical mass, to a tipping point that creates a trend. These trends can have profound influences on the whole market, change a whole industry or even lead to paradigm shifts in the way consumption is perceived.
3) For luxury companies, it is especially important to anticipate paradigm shifts within the value structure of people and the society at large. As luxury consumption is socially constructed, these changes affect all brands, if not immediately, then on the long run.
4) We want to uncover the underlying principles behind these paradigm shifts and the dynamics of disruptive tendencies.
5) We use these underlying principles to construct models that can be used to create strategies to counter the aforementioned disruptive tendencies and paradigm shifts.
6) We provide the contextual knowledge necessary to understand the phenomena in the market. Profound understanding of the underlying social gratification systems is needed for understanding and evaluating market phenomena.
7) For market segmentation to be effective, the marketing department has to have the ability to identify appropriate segments and to implement strategies to reach target groups.
8) By analyzing the subcultures/customer segments with a multi-level analysis, "areas of presence” are found in which the sub-culture/group is constructing their lives. Companies have to enter those spaces. To find these “areas of meaning” a combination of focus groups, interviews, media research, communication with CEOs from industry leaders in the luxury market, and theoretical reflection of basic literature is conducted. Focus groups alone could be very misleading. It would be naive to believe that customers exactly know what they want and why they do things.
9) All these insights are in need of continuous updates and critical reflection. Luxury companies should ask themselves if the people in charge of major marketing decisions are capable of understanding the respective culture and whether they are able to judge the validity of their own resources. The Japanese context provides companies with another challenge: the language barrier.
10) Most surveys exclude high net worth individuals. It is very hard to get access to the real rich opinion leaders, as they tend to not disclose their real intentions and motivations. Most can’t be reached in a direct way. The only method to get valid information from them is to enter their networks and establish personal contact with them. Japan Access has access to two companies offering concierge and other personalized services to a total of more than 10.000 high net worth individuals in the Japanese market. Japan Access takes on the role of an intermediary. We establish contact to the right experts and evaluate and explain their capabilities.

By making sure that results are interpreted in the right contextual framework, I am convinced luxury companies would not only be able to save a great deal of money, but would also be much better prepared to anticipate paradigm shifts and trends within the industry.

Attempt to clarify opinion building in the Japanese fashion market

2009-11-02T00:45:00.001-08:00

This posting will be clarified soon. The featured page from my notebook shows a dynamic within the Japanese fashion/apparel market.

Fashion and style magazines create styles, featuring certain brands which are sold in certain channels (as for example Marui Department Store, that features a lot of brands that are promoted in the magazine CanCam). Instead of only the brands being associated with a certain style, the department store is associated with a style/magazine that created/promotes it. This raises the interesting question, who are the girls who shop/buy/read the style of a certain department store (opposed to just a magazine).

If you take this one level higher (abstract) you end up with magazines promoting certain lifepaths that lead to a certain social mobility (or a style that thrives by the absence of the latter). All this is again connected to the division of labor, gender roles, and to the discrimination (in a western sense, if we take the cultural relativism argument seriously) of women in domestic life and the working place (but again, check please Office ladies and salaried men, for a more sophisticated account on gender division and labor in Japanese big corporations).

So, what really supports the high demand for fashionable clothing and "acceptable" outfits (also, at least not rejected) by the other sex, is the clearly defined and recreated gender roles. The ability of a woman to get a husband with a high paying job is treated like an asset that can be built up. But more on that later. I am working now on a model that allows the integration of my three-level luxury marketing model with the role of magazines and subcultures in Japan. It will support my argument that reading certain magazines can limit/enhace your choice of lifestyle paths (and therefore upward social mobility).

Social stratification in Japan for women

2009-11-01T09:32:00.000-08:00

The question about the origins for extensive luxury consumption in Japan lead us to the basic questions about social stratification. We want to be upwardly mobile in society, we want to perceive the world around us as being open for everybody to climb the success ladder, should he or she just try hard enough. Things have to be fair in Japan, entrance examinations that guard the gates of "higher eduaction" are delivered in a tank to the most prestigious institution of them all, Toudai. I will not elaborate on that issue, as reality, like most of the time, is much more complex than this. The fact is that a handful of the most prestigious institutions (considering their reputation) are the entrance into the world of succes in Japan. Taking recent data from the magazine "President", the department of business administration at Keio University (商学部) produces by average the most CEOs and board members. As always, these stats should be enjoyed with utmost care. People now in their 40s and 50s, holding those prestigious jobs had been in university 20-30 years ago, in the 70s and 80s. Drawing a connection to the effect of those channels is possible, if only indrectly, by expecting a self-fullfilling prophecy (yes, Merton). In Japan this might not be so far from the truth.

If we take the following assumptions, 1) social gratification in Japan is heavily influenced by your academic credentials, 2) the glass ceiling in upper management for women really exists, then we come to the conclusion that upward mobility in such a society is for most women limited to one option: marriage, meaning getting the "right" husband, who is part of the new rich or has the potential to become one. As economic constraints of the last 15 years have led to higher income inequality, the fight for the smaller group of men who are able to provide a woman with a comfortable lifestyle, has become more severe. It is no longer the question of belonging to the middle-class with steadily increasing wages in life-long employment, it has become a struggle to not belong to the lower middle-class, or worse.

Taking this, the question is what do women do to be included in the race and to increase their chances. Magazines like CanCam who teach "mote" or the art of getting the right guy, and how to behave in standard situations of the dating ritual, promote pre-market tested styles that are able to guarantee high chances for opposite sex approval. This magazine can be taken seriously, being one of many of its kind, with over 500,000 monthly copies (including the sister magazine AneCan) being printed, probably not only read by one person, with word of mouth and people browsing contents within convenience stores adding to its effect. Let us not see it as a simple lifestyle magazine and shopping catalogue, but as a guide for social gratification.

[ comment start
CanCam has suffered heavily though, in the last few years. Within 3 years the volume has decreased by over 50%, leaving the question open whether girls these days believe that CanCam can really help them to find Mr. Right. It seems as if the CanCam days are over. The basic logic remains, though. It needs to be answered how Japanese girls are dealing with it now.
] comment end

Cutting this argument short, let us take a look at what happens to a 22 year old girl in Tokyo when she enters the job market in an average clerical position, in a medium-prestigious company in the more central part of town. Not counting bonuses, her average salary in the first year will be around 170,000 - 220,000 Yen, if she is lucky. If she wants to live alone, an appartment in a not completely bad part of town (commuting below 1 hour one-way), including footwork, will cost (not counting key money and real estate agent fee) around 70,000 Yen, minimum, meaning a 1DK, 25 square meter charming home on the 6th floor somewhere near Kichijouji or Jiyuugaoka. She buys the fridge, the furniture, and is left (after heavy parental support), with less than 100.000 Yen a month, after her mobile phone bill and some other bills and health insurance are paid. This leaves her with, per day, around 3000 Yen, which is about 23 Euros. No going out, no shopping. Just plain living. If she is not on the career track, her perspectives are limited. If she is, her time will be even more so.

Now lets make this scenario a little bit nicer for the girl. She will stay with her parents who understand that in order to get the right marriage-material, she needs some backup. Suddenly, she has 100,000 Yen per month more to spend. The food is provided by her caring mom who can use the relationship to get over the separation anxiety. Assuming that this situation can't continue forever, the chances to get out of this deadlock in which no independent living is possible and salary increases are incremental (also on the long run if not on the career track), are increased by presenting yourself in the best light to adapt to social expectations posed on the female sex in respect to their appearance, accessories and manner of behaving.

My intention here is, of course, to sound cynical. How can a society function in which the first-year salary of most if not all jobs after university is basically never enough to lead an independent life that still grants enough time to find a partner.

Many women who decide to go on the career track face an interesting situation. Their salary in the beginning is somewhat higher, the bonuses more attractive. They will find out that what is lacking is time. And by living alone (if they do), their disposible income is very low, even after 2-3 years. The magical 30 years of age, which in Japan is referred to as the border to becoming a "make-inu" or loser-dog if not married by that age, is drawing closer and for most women promotion to high paying jobs is still a rarity. The strange outcome is now that women living with their parents, becoming so-called parasite singles, have more disposable income and more time for the dating ritual, including clothes and accessories, than their successful career-women counterparts.

Fashion cliques and sub-cultures

2009-10-19T15:53:00.000-07:00

Michael Zielenziger makes an interesting statement in his book "Shutting out the Sun" (2006) by comparing the behavior of Japanese young women (and men) of selecting the "uniform" of a group they aspire to and of expecting a reaction/approval by this group, with the clashing of social high school cliques in the US. The difference of Japan, so he continues, lies in the fact that this ritual or process continues into adulthood and symbolizes on a more profound level the "infantilization" of adult Japanese who have become accustomed to following the demands imposed on them by others (and of not asserting a right of choice and self-determination).

His conclusion strikes me as somewhat simplified. The social dynamics are created by societal rules and rituals that are created and reproduced in a complex interaction between fashion, elites, education, corporate culture and sub-cultures. Following peer-pressure and group norms is not uniquely Japanese. The group norms in the US are different (emphasizing assertion and self-confident behavior), the punishments take other forms (but are not less severe). Still the observation is correct, the rituals continue longer and in a more regulated fashion. Yet, the magazines and channels for creating the styles copied and adapted are diverse and can be altered by the sub-cultures and external shocks.

Wearing any kind of brand makes you feel more self-confident by assuring you the consent and approval of a group. Identity choices are the selection among offered possibilities. These "roles" are not only present in high school or university life but continue for the "shakaijin" (members of society), giving them "roles" or personalities among which to select. These "types" exist in the West, too. Maybe their signs and codes are not as explicitly codified and published in magazines, or discussed and as widely known as in Japan. If that is true remains to be debated.

Magazine breakdown for women under 30 (MEKAS): http://mekas.jp/en/tutorials/132.xhtml#1
for women over 30: http://mekas.jp/en/tutorials/320.xhtml#1

The dream equation

2009-09-21T22:37:00.000-07:00

The luxury dream formula as adapted from Dubois and Paternault 1995:

Dream = -8.6 + 0.58 awareness - 0.59 purchase