Have you ever wondered why startups in the global market don’t target the Japanese market? Maybe for the same reason Japanese startups are afraid to enter the global market?
Why startups should target Japanese customers
Author: SaiKaiAngel
First of all, one thing that should definitely not be underestimated is the language barrier. The Japanese in general, are not very keen on learning other universal languages, such as English this could be a pretty big limitation. On the other hand, Japan is a very conservative society and jealous of its culture and tradition. On the other hand, in the rest of the world, the Japanese language is not among the first to be learned. This is one of the first reasons why young start-ups choose English-speaking countries and other Asian countries that are growing at a very fast pace.
Unique customs and business cultures
Every country has unique customs and cultures, but I think the situation in Japan is more intense and explicit than in any other foreign country. Adventure in Japan is definitely not to be underestimated!
Let’s take some practical examples. If you want to promote your product or service in Japan, it might be difficult to do so without the support of an agency that can have a lot of influence on the market, especially if you provide technology media services for marketing. Even giants like Google and Facebook have hired local employees to support their agencies!
Some say that the Japanese love brands. In fact, I am of the opinion that the Japanese place great weight on a past reputation of trust before buying or subscribing to something. Considering these points, startups in foreign countries need a sophisticated strategy and marketing, and above all a trustworthy name.
photo credits: fiercebiotech.com
The standard strategy is to partner with a local company in Japan.
Of course, the local company should be familiar with the Japanese market and the language itself. By the way, Japanese people love the “made in Japan” brand, so they are willing to buy appliances in the shop that are not Samsung and LG, but Japanese brands such as Sony and Panasonic, even if they are obviously of lower quality and higher price.
This is not necessarily a bad thing in Japan, on the contrary! A company that wants to make a name for itself in Japan, should target the Japanese market from the start, so that it becomes better known.
Let’s take a look at the reasons why startups should target the Japanese market while taking some risks.
Market size
We are talking about a huge size, because the size of the Japanese market is the third largest in the world, so a huge potential for startups.
China has the second largest market, but let’s not forget that the Chinese Communist Party has run the entire nation and this has put a crackdown on foreign companies because they want to control every piece of information. While some American companies like Apple and Starbucks have been working in the Chinese market, Google and Facebook have practically not started working there yet. Considering this, it might be difficult or impossible to find your way into the Chinese market. So, taking out China, Japan becomes practically the second largest market after the US.
Excessive concentration in Tokyo
If you are a B2B company, you have to physically visit your potential customers because the Japanese prefer to conduct business in person. Tokyo, the capital of Japan, is a convenient and fascinating city for companies because almost all the offices are located in the Tokyo metropolitan area. If you can conquer Tokyo, you can practically enter the Japanese market with ease. Fortunately, there are many co-working spaces, such as WeWork, in Tokyo and many global startups have taken advantage of them.
High loyalty
As explained earlier, many Japanese people attach themselves to a brand. In other words, if you can work hard and gain the trust of new customers, the Japanese could be the most loyal customers for your brand.
According to Shopify’s State of Commerce report, Japanese users tend to repeatedly purchase items if the merchant has a good relationship with them. These statistics show how loyal and critical Japanese customers are to a business.
I want to conclude by saying that it is very important to try to enter the Japanese market, because all companies would need to have their own principles of brand loyalty and attachment. If all companies were able to do this, they would certainly be able to have a more loyal and constant audience over time and thus stay on the wave more. It is important to understand and appreciate the customs and traditions of a place before targeting its brand, it is important to create trust with one’s customers.
All this is what the Japanese believe in and what any global company should learn to do. Never lose sight of the Japanese market, because it is the one that will give you the satisfaction you need. Maybe some barriers exist, but the market is worth it with its size, focus and loyalty.
A startup has to be constant, loyal, and a good connoisseur of the habits and customs of the people it is addressing. It is not difficult to create a good branding in Japan, as soon as you have managed to overcome the language barrier, you just need to have this kind of strength and don’t forget that we are talking about, practically, the second largest market in the world after the United States.