A golden opportunity for Japanese retailers

Shopping in Japan is a national obsession and Golden Week, which kicks off this year on 29th April, is in many ways its apogee.

Golden Week is a group of Japanese festivals that incorporates several national holidays and runs this year until 6th May. It’s the longest holiday period of the year for both Japanese workers and school children.

Going for gold

In Japan, retailers launch a host of promotions and even bespoke products across both their physical locations and e-commerce operations to cash in on the period.

The festival encourages a considerable amount of travel, both domestic and international. An increase in visiting family and friends offers a significant e-commerce opportunity for both travel accessory and gift retailers.

Any retailer specialising in the children’s market should be ready for 5 May, when the Kodomo No Hi festival celebrates them with gifts such as toys and cakes.

If you’re looking for inspiration for unique products for Golden Week, Koinobori, which are kites in the shape of carps, are popular as are many products with the carp symbol.

At any time of the year though, Japan is an incredible e-commerce opportunity, with an internet penetration rate of just under 80%.

Three-quarters of the population have purchased products online, currently numbering around 82.59 million people, with an additional 6.33 million users expected to be shopping online by 2021.

These are high spending consumers, too. By 2022, the average customer will spend an average of 1,257.37 USD online annually.

The Midas Touch

But these consumers aren’t tied to their laptops and PCs. Of the 75% of the population that has purchased online, 9 out of 10 have purchased on their mobile.

Mobile is vital for any brand wishing to take advantage of Japan’s high spending consumer for it has long been a mobile-centric market. In fact, last year 22% of online shopping happened over mobile, worth around $9.7 billion.

Although Japan is undoubtedly one of the most attractive e-commerce markets in the world, there are several factors retailers should be aware of when entering the market.

Japanese consumers expect product packaging to be of very high quality, from the presentation of the product to the layout and clarity of the instructions. As in all aspects of Japanese society, attention to detail and customer service are of the highest priority. All relevant information such as delivery dates and processes, along with detailed product descriptions and explainers, need to be provided with absolute clarity.

The price and convenience focus that can be so effective in the UK needs to be replaced by one of high-quality content and user feedback – the Japanese are fervent online researchers of products and services, and reviews carry considerable weight.

It may seem to go without saying but Japanese language capability is essential at all stages of the online selling process from website product descriptions, to labels and packaging and marketing and customer service. But straight-forward translation services won’t cut it; you’ll need native speaker support – not just for translations and help with localisation for the Japanese audience, but also because e-commerce marketplaces require email and telephone customer support to be available in Japanese.

Those marketplaces are critical for any retailer in Japan, and it’s a brave company indeed that attempts to enter the market without their support, both to smooth the entry process and to reassure those consumers nervous about purchasing from foreign companies. The three most prominent to be aware of are Rakuten Ichiba, the largest, taking around 27% of the online retail market, Amazon Japan with 12% and Yahoo Japan with 6%.

Attention to such culturally-specific considerations is especially crucial given a traditional reluctance by consumers to purchase abroad, only 12% of Japanese shoppers purchased from abroad in 2015 for instance.

So, make sure you take time to understand the unique needs of Japanese shoppers and reflect local culture in your entire proposition.

Having a firm grip on the unique tax situation for foreign companies trading in Japan will also be critical.

The idea of the ‘Gaijin’ (foreigner) blundering around Japan upsetting the locals by blowing their nose loudly and not slurping their noodles may be a cliché, but there is no doubt that sensitivity to local cultural context is essential for any retailer looking for success in the country’s booming e-commerce market.