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Getting to grips with brand marketing in Japan

WPP’s Mike Busby says that brand marketing in Japan still lags product marketing – not surprising given Japan’s reputation for high standards, engineering excellence and best practice in product design. But brand marketing is valuable too

“There's a lot of emphasis on craftsmanship in Japan,” says Busby. “For hundreds of years there’s been a long-standing tradition of craft, design and manufacturing excellence. It’s what has put Japan on the map.”

By the same token, marketing in Japan is a very well-established function, but it’s very much driven by product excellence. “If we look at ads in Japan – across all media – you mainly see product-focused messages. That’s normal – companies need to sell their products – but if you look outside Japan, to say the US or the UK, there’s a lot more emphasis on creating an emotional connection – brand marketing – with the consumer,” he says.

That’s not to say there isn't any attempt to deliver emotional storytelling through humour or entertainment in Japanese ads; the ads are just much more functional. 

The data says value lies in brand strength 

There’s a direct correlation between brand strength and business performance. We know that from the data collected by WPP’s BAV which has been surveying consumers for 30 years. “This is partly driven by product, but it is also driven by other factors – or what BAV calls brand attributes,” says Busby. 

It’s easy to see a direct tangible return on investment in marketing a product through pricing and/or distribution, and to do so quickly. But brand-building is not always immediate and can take months, if not years, to achieve results. What BAV data tells us not only globally, but for Japan individually, is that brand value shows up in stock market performance and brand recommendation data – but it takes time. Ultimately, BAV tells us that the strongest brands grow business value 78% faster than the average S&P500 brand. And, typically, a 3% increase in brand strength creates a 1% increase in brand market share.  

“BAV helps us build brands and strengthen those brands for the future – as well as drive product growth,” says Busby. “When you undertake both product and brand marketing – combining product strengths with emotional connections – brands end up with a smarter marketing mix, maximising their growth potential.” 

Using current and past BAV data, the path of a brand’s development can be tracked and, importantly, be predicted. “And the data not only indicates the brand’s position in relation to its direct competitors, but also in relation to the market generally,” he says. 

“For example, a company that is selling a smartphone is not just competing with other phone manufacturers. It might also be competing with products in other segments, such as the newest gaming console, an electric bike or a limited-edition watch, in fact anything that attracts similar disposable income. That’s where it gets complicated. But it's important for a company to look beyond its direct competition, to all competitors, to successfully compete for that disposable income.” 

Countries are brands too 

Anecdotally we know that the country in which a product is made can positively impact its brand equity. We know from the BAV Best Countries data that where brands come from matters. In fact, 83% of consumers agree that consumer brands play an important role in defining a country’s culture.  

For example, German cars and Japanese electronics have a certain strong and positive reputation, although Japanese cars and German electronics have a certain cachet too. The power of the brands within those sectors is clear – but the power of the country over and above those brands doubles down on brand equity. 

This is something that WPP – through the lens of BAV consumer data – is particularly keen to spotlight. “The whole of Asia, if not the world, looks to Japan for design, fashion and technology trends. These are the areas in which it is particularly innovative. But Japanese brands often hesitate to talk about themselves outside Japan. BAV Best Countries data is helping Japanese brands understand the global context in which they are successful,” says Busby. 

For example, BAV can help a Japanese automotive brand, understand consumer perceptions of that brand in, say, Australia compared with the US or the UK. It’s this clarity of being able to look outwards that will enable brands to understand the global perception of their brand and make decisions about how they drive their business, from their home markets to the world stage.

The bigger picture 

From the macro-economic perspective, the Japanese economy is characterised by moderate economic recovery post-pandemic. If brands are to maximise their potential in this environment, Busby suggests an increased focus on brand-building is the way forward; that is building brand love, influence and brand advocacy.  

He reminds us that Japan is closely linked to the US in terms of economic and marketing trends. “When we look at where a business could take its brand, and how quickly it might do so, there is still some distance between Japan and the US, particularly in digitalisation,” he says.  

“One challenging factor for all marketers competing to sell and build brands has been the fragmentation of the marketing touchpoints due to digitalisation. Over the last 10 years, there has been substantial digital transformational in Japan, but there’s been a gradual adoption of new media, including digital platforms and streaming services. This is, in part, due to Japan’s huge ageing population, who still lean towards more traditional media.” 

In fact, 28% of the Japanese population is aged over 65, and that number is predicted to grow to around 38% by 2070. It’s a growing segment of the Japanese population and is a huge marketing opportunity that should not be ignored. “Brand love is not just associated with younger demographics,” says Busby. “Older groups also seek more than just transactional relationships; they are open to influence and inspiration from a brand too.”

This is true across all demographics. “Brands that prioritise building authentic and engaging relationships with their consumers are stronger and see business growth. This approach, which goes beyond product marketing, lags in Japan but is clearly an important feature of the Japanese market now,” says Busby. 

So, what does a strong brand look like? “It boils down to brand influence, loyalty and advocacy,” says Busby. “Does a brand influence you to behave a certain way? Would you buy the same brand again? Would you recommend a brand to your friends, regardless of whether you would buy it or not? That’s what shareholders are looking for. That is brand strength.” 

Mike Busby

WPP

published on

08 August 2023

Category

Communications Experience

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