The New Japanese Consumer

January 1, 2013

DISCUSSION TOPIC

 

The New Japanese Consumer

November 18, 2011

 

All:

 

After decades of behaving differently, Japanese consumers suddenly look a lot like their counterparts in Europe and the United States. Celebrated for their willingness to pay for quality and convenience and usually uninterested in cheaper products, Japanese consumers are now flocking to discount and online retailers. Sales of relatively affordable private-label foods have increased dramatically, and many consumers, despite small living spaces, are buying in bulk. Instead of eating out, people are entertaining at home. Workers are even packing their own lunches, sparking the nickname bento-danshi, or “boxlunch man.”

 

The preceding quote is from the latest “DFS Learning e-Blast” article, The New Japanese Consumer, by Brian Salsberg.

 

In this 2nd quarter 2010 article from the McKinsey Quarterly, the author provides an interesting overview of the Japanese consumer’s changing domestic purchasing behaviors.

 

In previous e-Blast articles we’ve explored the changing dynamics of consumers in Korea and China.  Today, learn what factors are changing the way the Japanese consumer thinks about shopping and brands, and how this impacts their shopping behaviors.  By better understanding what drives today’s Japanese shopper, we can better serve our #2 customer nationality as they visit our locations throughout the world.

 

More from the article:

 

This fundamental shift in the attitudes and behavior of Japanese consumers seems likely to persist, irrespective of any economic recovery.  That’s because the change stems not just from the recent downturn but also from deep-seated factors ranging from the digital revolution to the emergence of a less materialistic younger generation.

 

Read the short article to learn more!

 

Mike Osorio, your Dare to be Contagious™ strategist

 

www.OsorioGroup.com

 

What do you think?  Please add your comments to join the discussion!

 

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Insights on Korea’s Luxury Market

October 8, 2011

DISCUSSION TOPIC

Korea’s Luxury Market – 10-04-2011

“…the performances of famous brands in Korea have been mixed. For example, LVMH and Ferragamo continued to do well, but others, like Gucci Group and Dior, saw sales drop in real terms in 2010.”

The preceding quote is from the latest “DFS Learning e-Blast” article, Korea’s luxury market: Demanding consumers, but room to grow, by Aimee Kim and Martine Shin.

Read about the changing Korean shopping landscape in this write-up of the results from McKinsey’s 2011 Korea luxury consumer survey, available on the McKinsey & Company Web site. The authors note that McKinsey research shows that South Koreans spend a higher percentage of their household incomes on luxury goods than the Japanese do, and the South Korean market looks to sustain strong growth for several years to come. But the country’s thing for bling is evolving: buyers are beginning to think more about brand differentiation than about ostentatiously displaying famous logos.

While DFS does not currently do business directly in Korea, the insights from the McKinsey story highlight the purchasing behaviors of Koreans who continue to travel in significant numbers to many of our destinations.

More from the article:

Thus, while the headline news is that the luxury market is still growing strongly, uncertainty is also mounting. In this year’s report, McKinsey addresses these concerns, which come in the form of three key questions: Can South Korea keep it up? What’s changing? And what do these trends mean for the players in the luxury industry?”

Read the short article to learn more!

Mike Osorio, your Dare to be Contagious! ™ strategist

www.OsorioGroup.com

What do you think?  Please add your comments and add to the discussion!

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Mixed race and the effect on marketing

April 2, 2008

DISCUSSION TOPIC:  How should mixed race affect target marketing plans?

TOPIC SUMMARY:

A recent article in the New York Times entitled Who Are We? New Dialogue on Mixed Race discusses a consumer segment that we don’t hear about much: people who don’t neatly fit into the five racial buckets now being used by the U.S. Census.

According to the article, “The old categories are weakening … as immigration and the advancing age of marriage in the United States fuel a steady rise in the number of interracial marriages. The 2000 Census counted 3.1 million interracial couples, or about 6 percent of married couples. For the first time, the Census that year allowed respondents to identify themselves as being two or more races, a category that now includes 7.3 million Americans, or about 3 percent of the population.”

It’s not yet a big segment, but it’s one that’s growing in terms of visibility and identity, in part fueled by the mixed race heritage of Senator Barack Obama.

Though some choose a multiple race identity, others tend to stick to a one-race label; the decision of choosing a racial identity is often a deeply personal one. According to the article, racial identification “is influenced by how and where they were reared, how others perceive them, what they look like and how they themselves come to embrace their identity.”

Discussion questions:  Have the old racial categories become irrelevant? What are the implications for those companies that are specifically targeting specific racial groups with a marketing campaign?

My post:

From my observations and experience, issues surrounding race tend to diminish with higher education and income levels.  The more people understand others people and feel comfortable about their own financial status, the less likely they are to seek labels to insulate themselves against “others”, based on race or other definitions.

I believe the rich dialogue brought on by both Senator Obama’s and Senator Clinton’s candidacies is beneficial toward getting our country to move beyond race and gender stereotypes.  I am optimistic that we are on the right track in this regard.

The marketing question will, in turn, become moot as cultures mix together both via interracial marriages and simply through proximity.  The focus should always be on listening to what the customer is saying and observing what they are doing.  That is always the recipe for marketing success.

Mike Osorio, your Dare to be Contagious! TM strategist

http://www.osoriogroup.com/

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Go to the full discussion at RetailWire.com:
http://www.retailwire.com/Discussions/Sngl_Discussion.cfm/12862    

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The “Lipstick Indicator”

March 31, 2008

DISCUSSION TOPIC: Times are tough, so women are shopping – for lipstick

TOPIC SUMMARY:

In an article on the Australian site The Age they report:

Interest rates might be rising and food and fuel prices soaring, but it is going to take much more than that to wrest a woman away from her favourite lipstick.

Industry experts, including Steve Ogden-Barnes of the Australian Centre for Retail Studies at Monash University, say cosmetics is one category that is “recession-proof”.

“When things get tight, people might put off buying the new plasma or the new sofa, but there is no way a woman is going to leave the house without her make-up on,” he says.

In fact, there is a widely held belief that when times get tough cosmetic sales not only survive but thrive. They call it the “lipstick indicator”.

Originated by Leonard Lauder, chairman of the Estee Lauder Group, in the wake of the 9/11 attacks when lipstick sales in the US doubled, the theory goes that when things get tough women seek comfort in feel-good items. And while they may not be able to afford a $3000 handbag, they will fork out up to $30 for a lipstick.

Discussion questions:  Do you believe in the “lipstick indicator”?  Is it or will it hold true in America as in Australia?

My post:

My own unofficial polling of cosmetic industry professionals indicates that the “lipstick indicator” has largely held up over the years.  However, today’s economic issues have made even cosmetics businesses less than robust. The Aussies have the benefit of their commodities-based economy (somewhat similar to Canada in this regard) to bolster weaker areas and offset price hikes.  The US is suffering worse than most of the overseas economies and this is causing slackening business even in the cosmetics world, although not as severely as in other product categories.  In this way, the “lipstick indicator” continues to hold true.

Mike Osorio, your Dare to be Contagious! TM strategist

http://www.osoriogroup.com/

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Go to the full article at TheAge.com:
http://www.theage.com.au/news/national/times-are-tough-so-women-are-shopping-151-for-lipstick/2008/03/29/1206207499094.html   

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Boomers return to hippie values of their youth

March 28, 2008

DISCUSSION TOPIC:  Study: Boomer Shoppers to Become Pragmatic with Age

TOPIC SUMMARY:

According to a survey of 1,100 Baby Boomers, 86 percent plan to be more practical and pragmatic in their purchases when they reach the age of 70, and much less concerned about trendiness and indulgences.

The study providers, FH Boom and the National Marketing Institute, believe the turn to the pragmatic is highly correlated to the fact that only 41 percent of Boomers state they have a secure, financially sound plan for retirement. After paying their basic living expenses, Boomers anticipated that they will have on average 22 percent of their income left to spend on discretionary purchases.

But the buying pragmatism may also reflect Boomers readapting more hippie-like values held in their younger days.

“The key is to think of boomers at 70 not so much as revolutionaries, but as ‘retrolutionaries,'” says Dr. Carol Orsborn, co-chair of FH Boom. “By this definition, retrolutionaries are the vast majority of Boomer-aged consumers who are aiming to get their monetary expenditures in better alignment with values formed at earlier stages in their lives. Think the 2016 version of Birkenstocks and VW in the 60s and 70s: living affordably, but with style.”

Discussion questions:  Do you also expect Boomer spending tendencies to become more “more practical and pragmatic” as they reach the age of 70 and older? Why or why not? What credence do you give to the theory that Boomer spending habits might be reshaped by a return to hippie attitudes?

My post:

I always find it amusing when studies attempt to categorize and describe the tendencies of the Boomers.  The generation is simply to large and spread over too many years to neatly label and predict.  However, some of the observations are likely to be true:  Boomers will continue to avoid “getting old” and will spend on products and experiences that keep them feeling, if not looking, young.  Also, Boomers will remain connected to current happenings via technology and continued linking with Gens X & Y.  Therefore, they will always adopt those new products, services and experiences that feel “cool” and contribute to the desire to remain forever young.  For example, I regularly share on-line music with my college-age sons both because it is a shared interest, but also because I genuinely like much of the new music.  I expect this will continue well into my 70’s and beyond!

Mike Osorio, your Dare to be Contagious! TM strategist

http://www.osoriogroup.com/

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GO TO THE FULL DISCUSSION AT RETAILWIRE.COM:
http://www.retailwire.com/Discussions/Sngl_Discussion.cfm/12853  

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Thank you for visiting my blog!  Please subscribe using the RSS button and comment on my postings.  Comments are the life-blood of any blog and I appreciate yours!


IKEA irritates the Danes

March 18, 2008

DISCUSSION TOPIC:  Translating Retail Success Across National Borders

TOPIC SUMMARY:

There is yet another potential impact of importing and exporting that retailers are now starting to consider. Boasting 273 stores attracting some 583 million customers each year, IKEA, for example, needs to be aware of what people think and feel.

Both The Independent and The Daily Telegraph in the UK reported that Danish customers of the Swedish shop are less than happy with what’s being offered for sale or at least with what the products are called.

IKEA’s products tend to have names rather than numbers, a situation that has recently caused complaints from customers in Denmark, historically a rival of IKEA’s Swedish-based empire. According to The Independent, complaints have been made about some of the names chosen. Apparently those with Danish derivation are used for some of the retailer’s less salubrious, or lowly, products such as doormats, rug linings and toilet seats, for example.

Discussion questions:  Is the IKEA Danish experience unusual in the arena of global marketing? Where do retailers go to acquire the cultural education required to open without incident in new international markets? Is there are retail company or brand that you think best epitomizes how to go about expanding globally?

My post:

International expansion of brands and retailers always creates the potential for cultural missteps.  IKEA did not purposely named their products with names that would offend Danes.  Using names for their products vs. numbers requires them to either use different names in different countries, or choose to not care if one country has an issue with a name that is fine everywhere else.  

When a retailer or brand expands into a different country (or even a different state) it is incumbent upon them to do some due diligence in the new location, particularly regarding marketing and branding methods.  It would not have been a significant issue to rename a few of the IKEA products for the Danish market if indeed some of the names are offensive.

Examples of brands and retailers who have expanded globally effectively include McDonalds and DFS Galleria.  McDonalds offers key products like the Big Mac worldwide, but then adds menu items that relate to the local populace.  DFS Galleria, the Hong Kong-based purveyor of luxury brands in gallerias and airport duty-free locations throughout the Asia Pacific region, pays close attention to how each nationality communicates and shops.  In-store signage, associate language skills, and marketing efforts all support this.

Mike Osorio, your Dare to be Contagious! TM strategist

http://www.osoriogroup.com/

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GO TO THE FULL DISCUSSION AT RETAILWIRE.COM:
http://www.retailwire.com/Discussions/Sngl_Discussion.cfm/12829  

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Thank you for visiting my blog!  Please subscribe using the RSS button and comment on my postings.  Comments are the life-blood of any blog and I appreciate yours!


Warehouse clubs thrive

March 7, 2008

DISCUSSION TOPIC:  Consumers Stocking Up in Warehouse Clubs

TOPIC SUMMARY:

There’s no doubt that many American consumers and businesses are going through a rough patch at the moment. For warehouse clubs, however, the weak economy has proven to be something of a boon as savings minded consumers look for the low unit prices that come with buying in bulk.

Costco, Sam’s Club and BJ’s all reported strong sales and profit results this week. Costco saw same-store sales climb seven percent last month while BJ’s experienced a 5.9 percent increase. Sam’s same-store sales were up 2.8 percent.

Discussion questions: Do you expect that warehouse clubs will continue to perform well should the economic conditions stay the same or worsen? Will consumers continue to shift their dollars to warehouse clubs after the economy has rebounded? What do you see as the relative strengths/weaknesses of the three warehouse club chains during a down economy?

My post:

This is a perfect time for Costco and BJ’s to strengthen their positioning.  Costco will do particularly well, as they have developed the reputation as a place for the affluent to shop with no embarrassment.  They will shift dollars away from categories that aren’t experiencing strong demand, to more basics, but otherwise I expect them to thrive during this period and even after a recovery sets in.

Mike Osorio, your Dare to be Contagious! TM strategist

http://www.osoriogroup.com/

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GO TO THE FULL DISCUSSION AT RETAILWIRE.COM:
http://www.retailwire.com/Discussions/Sngl_Discussion.cfm/12806

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Thank you for visiting my blog!  Please subscribe using the RSS button and comment on my postings.  Comments are the life-blood of any blog and I appreciate yours!