When the US home improvement retailer Home Depot attempted to enter the Japanese market in the 1990s, it failed to gain traction due to intense competition from local retailers and cultural differences. And when UK supermarket giant Tesco attempted to enter the Japanese market in 2003, it failed to gain a foothold and eventually withdrew from the market in 2011.

These examples demonstrate that foreign brands must understand the local market and consumer preferences to be successful in Japan. Brands must also be willing to make the necessary adaptations and investments to succeed in this highly competitive market.

Japanese consumers have unique cultural and societal influences that differentiate them from consumers in Western countries like the United States and the United Kingdom. 

Brands looking to succeed in the Japanese market should consider these differences when developing their marketing and product strategies. Here are some key differences:

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Brand loyalty: Japanese consumers are often highly loyal to specific brands and may be more likely to purchase products from established brands they trust.

Attention to detail: Japanese consumers are known for their attention to detail and appreciate well-designed and well-crafted products. They also place a premium on functionality and practicality.

Quality expectations: Japanese consumers have high expectations for quality and place a premium on well-made and durable products.

Technical sophistication: Japanese consumers are known for their technical sophistication and are often early adopters of new technology and products.

Environmentalism: Japanese consumers are increasingly environmentally conscious and may be more likely to purchase environmentally friendly products.

Retail culture: Retail culture in Japan is different from that in Western countries, with a strong emphasis on in-store experiences and customer service.

Fashion and beauty: Japanese consumers place a strong emphasis on fashion and beauty, and they are known for their unique and eclectic sense of style.

Below are eight important considerations brands should research and understand before launching their product or service into the Japanese market.

1. Cultural sensitivity: Understanding Japanese cultural norms and customs is crucial for a successful product launch.

Cultural sensitivity is an important consideration for brands looking to bring a product into Japan, as cultural norms and values play a significant role in shaping consumer behaviour. 

Brands should take the time to understand the local culture and customs and tailor their offerings accordingly.

Here are some key points to consider when it comes to cultural sensitivity in the Japanese market:

  • Respect for tradition: Japan has a rich cultural heritage and tradition, and brands should respect and be mindful of these cultural values.
  • Attention to detail: Japanese consumers have high expectations for detail and quality in products, packaging, and marketing materials. Brands should ensure that their offerings meet these expectations.
  • Honorific language: In Japan, it is important to use appropriate honorific language when communicating with consumers, especially in advertising and marketing materials.
  • Social customs: Understanding and respecting social customs, such as gift-giving, is important in building relationships with customers.
  • Sensitivity to local customs: Brands should be sensitive to local customs, such as the preference for modesty in dress and advertising, and avoid causing offense.

2. Local regulations: Familiarising with the local laws and regulations regarding product labelling, packaging, and marketing materials.

Local regulations are important for brands looking to bring a product into Japan as they impact product labelling, packaging, and marketing materials. 

Brands must comply with local regulations when bringing a product into Japan. This helps avoid legal and financial issues and ensures that the product is well received by the market.

Here are some key points to consider when it comes to local regulations in the Japanese market:

  • Product labelling: Labeling requirements in Japan are stringent, and brands should ensure that their products meet all the required regulations, including health and safety standards, labelling information, and warnings.
  • Packaging regulations: Packaging regulations in Japan are also strict, and brands should ensure that their packaging is compliant with local standards and regulations.
  • Marketing materials: Marketing materials such as advertisements and promotional materials should also comply with local regulations, including guidelines on product claims, testimonials, and endorsements.
  • Import restrictions: Brands should also be aware of import restrictions on certain products, including food, pharmaceuticals, and chemicals.
  • Environmental regulations: Japan has strict environmental regulations, and brands should ensure that their products and manufacturing processes meet these standards.

3. Distribution channels: Identifying and partnering with the right distribution channels in Japan is crucial.

Identifying and partnering with the right distribution channels is crucial for brands looking to bring a product into Japan as it affects the reach and success of the product in the market. 

Choosing the proper distribution channels is critical to the success of a product in the Japanese market. Brands should carefully consider their options and build strong relationships with their distribution partners to ensure the product reaches the right customers.

Here are some key points to consider when it comes to distribution channels in the Japanese market:

  • Retail landscape: Japan has a complex retail landscape, with a mix of large chain stores, speciality stores, and online retailers. Brands should understand the different channels and choose the most suitable ones for their product.
  • Wholesale vs. Direct Sales: Brands should consider selling their products directly to consumers or through a wholesale distribution channel. Direct sales may offer more control over pricing and product positioning, but wholesale distribution can provide a wider reach and lower costs.
  • Importance of relationships: In Japan, relationships play a crucial role in business, and brands should take the time to build strong relationships with distribution partners.
  • E-commerce: Online retail is becoming increasingly important in Japan, and brands should consider an e-commerce strategy as part of their distribution plan.

4. Consumer behaviour: Understanding Japanese consumers’ unique buying habits and preferences can help a brand tailor its offerings accordingly.

Understanding consumer behaviour is crucial for brands looking to bring a product into Japan, as it can impact product positioning, marketing, and sales. 

Brands should research consumer preferences, trends, and buying habits to ensure that their product offerings resonate with the local market.

Here are some key points to consider when it comes to consumer behaviour in the Japanese market:

  • Brand loyalty: Japanese consumers tend to be highly loyal to brands and often make purchasing decisions based on brand reputation and quality.
  • Quality over price: Japanese consumers place a high value on quality and are often willing to pay a premium for products that meet their expectations.
  • Attention to detail: Japanese consumers are known for their attention to detail, and they appreciate well-designed and well-made products.
  • Health and wellness: Health and wellness are important concerns for Japanese consumers, and brands should consider these needs when developing their products.
  • Trends: Keep up-to-date with the latest consumer trends in Japan, as they can change quickly and impact consumer preferences.
  • Advertising: Advertising and marketing strategies should be tailored to meet the needs and preferences of Japanese consumers.

5. Language: Communication in the local language is key, and translated materials should be culturally appropriate and high-quality.

Language is an important consideration for brands looking to bring a product into Japan as it impacts product labelling, packaging, marketing, and customer service. 

Brands should ensure that they communicate effectively with customers, use the appropriate language, and adapt their products to meet local preferences. This can build trust and credibility with Japanese consumers and ensure a successful product launch.

Here are some key points to consider when it comes to language in the Japanese market:

  • Official language: Japanese is the official language of Japan and is widely spoken by the population. Brands should ensure that their product labelling, packaging, and marketing materials are translated accurately into Japanese.
  • Localisation: Brands should also consider localisation, which means adapting the product to meet the cultural and linguistic norms of the local market. This can include changing product names, packaging design, and marketing materials to reflect local preferences.
  • Customer service: Brands should ensure that they have a customer service team that can communicate effectively with Japanese customers in their language.
  • Language skills: Brands should invest in language training for employees working in the Japanese market to ensure effective communication and a smooth transition.

6. Product adaptions: Packaging size, product specifications, and ingredients may need to be adapted for the Japanese market.

Product adaptation is the process of modifying a product to meet the specific needs and preferences of a local market and is an important consideration for brands looking to bring a product into Japan. 

Brands should take the time to understand local consumer preferences and requirements and make the necessary adaptations to ensure that their products meet local needs and regulations. This can build trust and credibility with Japanese consumers and increase their chances of success in the market.

Here are some key points to consider when it comes to product adaptation in the Japanese market:

  • Cultural differences: Brands should be mindful of cultural differences in Japan and how they may impact product design and features. For example, products may need to be modified to fit smaller living spaces or meet local safety regulations.
  • Consumer preferences: Brands should conduct market research to understand local consumer preferences and make necessary product adaptions to meet their needs. For example, local consumers may prefer different colours, sizes, or materials.
  • Technical requirements: Brands should ensure that their products meet the technical requirements in Japan, including certifications and regulatory approvals.
  • Local suppliers: Brands may need to source local suppliers for raw materials or components to ensure that the product is manufactured in compliance with local regulations.
  • After-sales support: Brands should also consider after-sales support when making product adaptations, as local consumers may have different expectations for customer service and repair services.

7. Quality expectations: Japanese consumers have high expectations for product quality, so brands need to ensure that their offerings meet these expectations.

Quality expectations are critical for brands looking to bring a product into Japan, as they can significantly impact product success. 

Brands should ensure that their products meet Japanese consumers’ high standards, focus on building a positive brand image, and provide excellent after-sales support to meet customer needs. This can help to build trust and credibility with Japanese consumers and increase their chances of success in the market.

Here are some key points to consider when it comes to quality expectations in the Japanese market:

  • High standards: Japanese consumers have a high expectation for quality, and they place a premium on products that are well-made and durable. Brands should ensure that their products meet these quality standards to succeed in the market.
  • Attention to detail: Japanese consumers are known for their attention to detail, and they appreciate well-designed and well-crafted products. Brands should focus on ensuring that their products are of the highest quality, emphasizing attention to detail.
  • Brand reputation: Quality expectations are closely tied to brand reputation in Japan, and consumers will often make purchasing decisions based on a brand’s reputation for quality. Brands should focus on building a positive brand image to increase their chances of success in the market.
  • After-sales support: Quality expectations also extend to after-sales support, and Japanese consumers expect that their products will be repaired or replaced if they fail. Brands should have a robust after-sales support system to meet these expectations.

8. Marketing strategies: Developing a marketing strategy that resonates with Japanese consumers is important, including considering local social media and influencer marketing.

Marketing strategies are an important consideration for brands looking to bring a product into Japan, as they can significantly impact product success. 

Brands should take the time to understand local consumer behaviour and cultural differences and tailor their marketing strategies accordingly. This can help to build brand awareness and reach the right target audience, increasing the chances of success in the market.

Here are some key points to consider when it comes to marketing strategies in the Japanese market:

  • Cultural differences: Brands should be mindful of cultural differences in Japan and tailor their marketing strategies accordingly. For example, marketing materials may need to be modified to reflect local preferences and cultural norms.
  • Consumer behaviour: Brands should conduct market research to understand local consumer behaviour, including purchasing habits and preferred marketing channels. This information can be used to inform the development of a targeted marketing strategy.
  • Local media: Brands should consider using local media, such as television, newspapers, and magazines, to reach their target audience in Japan.
  • Digital marketing: Digital marketing is becoming increasingly important in Japan, and brands should consider using digital channels, such as social media, email marketing, and search engine optimization (SEO), to reach their target audience.
  • Influencer marketing: Influencer marketing is also becoming popular in Japan, and brands may consider partnering with local influencers to reach their target audience.

Market research can help companies and their brands understand the unique business landscape in Japan. For more information on how to develop a successful market entry strategy for Japan, read our blog, How to Develop a Market Entry Strategy in Japan

If you are interested in Kadence’s market research capabilities in Japan, download our agency credentials document here or submit a Request for Proposal here.

With a GDP of $5.15 trillion, Japan is well-positioned for international expansion and offers substantial business opportunities for brands in various industries. 

The country has dramatically bounced back from the disruption caused by the 2011 natural disasters, like the earthquake and the Tsunami.

Japanese motor vehicles and electronics are prevalent globally. It is also among the world’s largest producers of steel. 

The country is among the world’s largest exporters of motor vehicles and electronic equipment. The service sector makes up the highest percentage of the economy in terms of gross domestic product and employment.

Major Industries in Japan

Japan’s five largest companies by market capitalization are Toyota, Sony, Keyence, Recruit Holdings, and SoftBank Group. Sony’s portfolio includes a distinctly non-Japanese Hollywood movie and music business originally acquired through a merger and acquisition over 30 years ago. SoftBank, in recent years, has morphed into a massive tech fund run by foreign fund managers invested almost entirely in non-Japanese startups. Recruit’s new CEO spent ten years acquiring and growing recruitment businesses in the U.S. before his promotion earlier in 2022.

Japan is focused on manufacturing precision and technology products such as hybrid vehicles, robotics, and optical instruments.

Other industries prominent in Japan are agriculture, fishing, and tourism. 

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What makes Japan an excellent choice for international expansion

Large World economy

The third-largest economy in the world, after the United States and China, and the fourth largest importer of U.S. products, Japan is open for international business. It is also one of the world’s most literate and technically advanced nations.

Robust Consumer Economy

Japan has a robust consumer economy with a per capita income of $42,197 and is a haven for brands that want to expand internationally. Japan’s massive consumer economy, in which consumers with considerable purchasing power seek high-quality and innovative goods and services. 

Protections and Compliance

An essential member of the international trade system, Japan complies with the law, and its efforts to maintain the rule of law is one of the pillars of its foreign policy. It also provides intellectual property protection and rights. 

Easy and inexpensive to set up an office 

According to the World Bank’s “Ease of Doing Business” report, it takes about 11 days to incorporate. It costs 0.7 percent or JPY 60,000, (approximately USD 470 million), whichever is higher, and registration and seal fees. For companies that want to set up a branch office, the costs are low and procedures simple. Co-working spaces are also an option in bigger cities. 

Rapidly Aging Population

Japan is ageing fast. One in three people is estimated to be 65 years and older by 2036, conferring the title of the world’s leading “super-aged society.”



While the nation’s rapidly ageing and declining population pose risks of an economic crisis, it also presents massive opportunities. As a result of the declining population, individual income has risen, surpassing U.S. citizens.

Fewer people in Japan mean larger living spaces, more arable land capital, more disposable income, and higher quality of living. This fuels the growth in several industries, such as pharmaceuticals, healthcare, franchising, and real estate, to name a few.

Seniors in Japan are financially secure and healthy overall and big consumers of various products and services. 

Innovation and Research 

Japan reigns supreme in research as a nation with a large senior population. It has a goldmine of data on ageing, medical data, and medical assessments—these datasets are beneficial for local governments worldwide. The nation ushers innovation and technological advancement in many sectors. 

Just as countries can look up to Japan to help their ageing population and fill technological gaps, foreign brands can view this as a great time to expand and invest in such fields.

Significant obstacles to consider before entering the Japanese market

Entering the Japanese market is lucrative and full of opportunities, but it is not without many obstacles and challenges. It is noteworthy here that Japan is one of the few Asian countries that never had a western country rule over them, and this is because of Japanese are strong-willed and are rooted in tradition. 

Although tariffs are generally low, Japan has other barriers to entering the market that may hinder foreign products’ importation into the country. 

It is essential to factor in some of the most significant obstacles before entering the Japanese market. These hurdles can be measured against the brand and company goals to make the right decision and market entry plan. 

  1. Japan’s size makes it essential for brands to invest substantially, increasing risks.
  2. Japan is a highly competitive market, and domestic brands have a strong presence. Therefore, it is not easy to compete with local Japanese companies. However, thorough market research before creating the market entry plan can help brands overcome the challenge of competing with local companies.
  3. Japanese are discerning and look for value for money and high quality when making purchase decisions. Additionally, the Japanese culture and tastes are very different from the Western world. Therefore, brands have to redesign and redevelop their products and services to tailor them to local tastes and preferences in most cases. Market research and product testing methodologies can help brands create and tweak products to fit the Japanese lifestyle and culture.
  4. Japan has very little foreign investment for an advanced nation, keeping the Japanese business sector isolated. As a result, only about 3-5 percent of Japanese speak good English, which can be a barrier for some countries.
  5. Japan has a strong network of regulations, permissions, and extensive procedures as a bureaucratic country. These strict regulations keep new entrants from competing with established industries. However, these regulations are being slowly relaxed.
  6. Management and H.R. policies are very different in Japan, and organizations entering the country must consider and adapt to the management style in Japan, because failing to do so, is a recipe for disaster. 

Marketing to the Japanese consumer

Japan is a unique market, and it is crucial to understand the cultural nuances and the Japanese consumer. You cannot become a Japanese marketing expert overnight, and it is helpful to hire local advertising agencies when marketing in Japan. 

For the same reason as above, it is critical to regionalise everything. Labels on products and marketing and sales materials, digital campaigns, and the website need to be in the Japanese language.

The Pepsiman commercial is an excellent example of regionalizing a brand. When Pepsi’s Japan branch decided to create something regional for Japan, they contacted Travis Charest to create a superhero mascot to promote Pepsi. This faceless superhero managed to get a cult following in the country. They developed an action game for the Playstation and created several successful commercials using Pepsiman. 

Nike’s attempt to extend its marketing message to include social activism in Japan was met with criticism. Nike Japan released a video depicting the struggles of women athletes in Japan that faced bullying and racism, topics that are not openly discussed in the country.

Martin Roll, a business and brand adviser, says that Japanese consumers are not as vocal and will not express dissent unless they feel brands cross a red line. Therefore, it is important to have a deep understanding of the culture, the sentiment of the people, the root of homogeneity in Japan (post-Hiroshima Nagasaki, there was a focus on a homogeneous society), and how to carefully tread the delicate line. 

https://www.youtube.com/watch?v=XkFaQuhHOtw

As in any other new country, it is also essential to have a local marketing plan and calendar.

Distribution and Sales Channels in Japan

The choice of distribution channels depends upon the product. Due to space limitations, small retail stores often stock limited inventory, and wholesalers deliver smaller amounts more frequently. 

Culturally, the Japanese prefer face-to-face interactions and place a high value on building and maintaining business relationships. This distribution system is costly and increases the price of goods. The growth of big box stores and e-commerce is challenging this status quo. 

In 2021, approximately 2.25 million vending machines in Japan were beverage vending machines, selling drinks like cooled beverages or coffee. 

The primary distribution and logistics points are found in the major port cities, like Tokyo, Yokohama, Kobe, Osaka, and Fukuoka.    

Market entry strategy for Japan

Brands need to develop and maintain strong relationships with local partners to gain a foothold and succeed in the Japanese market. The local partner can act as an agent, representative, or distributor and manage a branch office or subsidiary in Japan. 

Since the business culture is unique in Japan, visiting the country several times before entering the market is good. This can help familiarise the organization with the culture and business climate. 

Japan has a stable economy and is a dream destination for foreign investment. The key to successful business entry in Japan is doing the leg work using market research to understand the culture, localise the product and messaging, and find the right partner to expand the given brand in this unique marketplace full of opportunities.

Market research in Japanhas been transformed by the emergence of online research. While other Asian markets continue to favour more personal, face-to-face techniques, Japanese culture is perfectly suited to this more arms-length approach, especially when it comes to researching conventional, mainstream audiences. Online research means that Japanese consumers don’t have to personally interact with researchers in person to complete surveys; a factor that circumvents a Japanese antipathy towards personal interactions with strangers. The idea of sharing personal information can make some Japanese consumers deeply uncomfortable and extends itself to a desire to avoid picking up phone calls from unknown numbers, which means telephone research in Japan is difficult to execute, too. 

On the other hand, online research methods remove human interaction from the research process, encouraging participation from respondents who may not enjoy the process of a face to face interview or focus group. Respondents can relax without the pressures of sharing directly with another individual and are more likely to give honest and detailed responses when giving answers at their own leisure. Likewise, online research methods provide a sense of control to the respondent.

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Unlike in a face-to-face interview, every question in an online survey is predetermined, and while this impacts the level of insight a researcher can reach, it provides a safer environment for respondents who are concerned that the spontaneity of a ‘live’ interview may lead them to revealing too much information, or at least a feeling of great social awkwardness.

Unlike in a face-to-face interview, every question in an online survey is predetermined, and while this impacts the level of insight a researcher can reach, it provides a safer environment for respondents who are concerned that the spontaneity of a ‘live’ interview may lead them to revealing too much information, or at least a feeling of great social awkwardness.

What’s more, Japanese infrastructure lends itself to online research. Commute times into Tokyo and other major cities like Osaka and Nagoya are typically an hour in duration, which means that many Japanese have at least 2 hours each day of ‘dead time’. And, with incentives provided to all who take part, online research is arguably one of the best ways to monetise this time. With high quality 3G and 4G networks in existence for years now, this has allowed online research to flourish during the commute.

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Although face-to-face research benefits researchers elsewhere, creating a personal relationship with respondents and opportunities for spontaneous questions that lead to deeper insights, these advantages are negated for researchers in Japan. The dominance of online research in Japan can be surprising to those less familiar with the country, but its capabilities to reach huge numbers of respondents quickly, cheaply and comfortably, mean that it is by far the best option for gaining accurate, primary quantitative data. 

We at Kadence are big advocates of brands creating their own futures, rather than try to predict it. Earlier in the year, before the whole pandemic went global, we brought together trend watching experts from across our global boutique to identify four key trends that we believe will define the next 12 months, inspiring innovation across Asia, the US and Europe, that we outlined in this report.

How to conduct online market research in Asia: The Go-To Guide
Interested in understanding how to approach online research across other Asian countries? Download the guide here