The marketing approach of Japanese companies contrasts starkly with the common practices in the US. We can learn a lot of valuable lessons from studying how the Japanese market their products, especially since companies like Toyota are crushing the competition. The last time I checked, the market cap of Toyota was around $600 billion while GM and Ford may not survive without government bailouts. The book Relentless describes some of the major differences in marketing strategy in Japan and how this approach can be extremely effective.
Intuition versus Market Research
Many companies in Japan rely on common sense and intuition when developing products for launch rather than lengthy and expensive market research. They will often follow their intuition and launch a new product on a small scale and then incrementally scale and improve it based on the feedback they get from actual customers. This makes a lot of sense when you consider that a high percentage of new products that flop despite extensive market testing and research. It is extremely difficult to accurately predict consumer behavior as even the best executed research can be dead wrong. Many internet companies take this approach by releasing a beta version of their site and continuously improving upon it.
Imitation and Churning
The authors of Relentless observe that Japanese companies are very adept at quickly imitating innovations. When one company launches a unique product, the competition is quick to go to market with similar versions. Churning refers to the fast cycle of innovation and imitation. Churning makes it difficult for anyone to maintain a first mover advantage but the positive is that consumers are less afraid to be early adapters since several companies have created a similar product. This helps the whole category to grow and this inherently helps the leader although there is less of a first mover advantage. This also creates an environment that encourages fast adoption of new technology.
The Buyer is the Master
There are obviously many differences in the culture in Japan, and one that can be striking is the relationship between buyer and seller. Too often in the US, the buyer is at the mercy of the seller, take auto mechanics or cell phone carriers for instance. Also, buyers in the US often have a confrontational approach with sellers who may try to push things they don’t need or charge the highest price possible. In Japan the buyer is the master and the seller is like a servant. This changes the whole dynamic of how products are sold and marketed. The seller is concerned with what the buyer wants, rather than what they want to sell. When the customer’s interest is put before the profit of the company, this can lead to strong and lasting relationships between the buyer and seller.
Many Japanese Companies do not have “Marketers”
In Japan, often marketing is part of everyone’s job in the company rather than a specialized department with specialized professionals in marketing. As a result many companies do not have marketing managers. While I don’t necessarily think US companies should get rid of their marketing departments, a lot of successful companies do little or no formal marketing. In Japan, the quality of their products speak louder than any commercial.
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