Yamato Strikes Again - Cat Building Box Video Goes Viral to Promote Small Packets Courier Service

Remember when couriers advertised their services by promoting attributes like:
     being on time
     delivering when they say they will deliver?
Remember "It is so easy even a MBA can do it?"
Well, Yamato just topped that. 
They claim that their small packet business is so accessible and easy to use that even a cat can do it.  http://www.kuronekoyamato.co.jp/campaign/compactcmp/
And yeah, of course their video is going viral!
AND, they are running a photo contest for cats with boxes as well as calling for auditions for a cat ambassador for the service!


Japan's Splurging Seniors: Enjoying the Fruits of "Saving Up for Old Age"

Now 10% of the population, Japan's "Swinging 70s Women" outspend not just men, but younger women on beauty, socializing, and clothes.

Over 14 million women, or more than 10% of the 127 million Japanese people are aged 70 or above. There are 1.4 times more women in that age group than men, and these women are outspending their younger counterparts in fashion apparel, social dining, and beauty services and products. 

  • Japanese women’s average lifespan announced in July 2015 is 86.61 years old, an increase of 0.21 years over the previous year. Blessed with good health and free of the financial burden of raising children and caring for their aged parents, these women outspend women in their 30s and 40s in fashion apparel, beauty services and cosmetics, and socializing. 

  • The governments’ household spending survey shows that for skirts, for example, women in their 20s spend 2,997 yen; women in their 30s spend 3,641 yen; and women in their 70 and above spend 6,749 yen. 

  • In the same token, women in their 20s spend 22,237 yen on beauty treatments (including hair cuts and styling); women in their 30s spend 34,301 yen; and the septuagenarians spend 39,299 yen. 

  • Mitsukoshi Department Store Nihonbashi Store (the group’s flagship store and known for its wealthy clientele including members of the Imperial family) opened a upmarket multi brand boutique named Re-Style Lady in September 2014, targeting women aged 64 through 74. To accommodate the older clientele, the store is fitted with twice as many fitting rooms as other boutiques within Mitsukoshi, and also includes a socializing corner. According to Mitsukoshi Sales Manager Takumi Odajima on the Nikkei Marketing Journal (12 July 2015 issue), the boutique has exceeded sales targets to date, and some months in double-digits.

  • Fast Nail, a nail salon chain with 31 salons, is seeing approximately 20 regular customers who are in their 70s at one of their flagship salons, Nails Unique Ultimate in Toshima-ku, Tokyo. According to Chihiro Yamawaki, Store Manager, in an interview with CarpeDiemJapan, “while the average customer in her 20s and 30s spend around 10,000 yen per visit, the older customers spend at least 12,000 yen because they have no restrictions for designs due to work. They are happy to have more decorative nails. They also come here for the socializing. Spending a couple of hours chatting to our manicurists is something they enjoy and look forward to. "

  • Yuko Yuko, a travel publication targeting seniors, is now delivered to 1.2 million households and 1.5 million subscribers. http://www.yukoyuko.co.jp/service/  The bimonthly publication not only offers information, but is full of vouchers that offer special packages at hotels and restaurants, as well as discounts. 33% of all voucher users are over the age of 70 and 70% of them are women. “The average price for a lunch is in the higher 2,000 yen range, but readers seem to choose their destinations not by price, but by atmosphere and quality of the food,” comments YukoYuko Senior Management Strategist, Hiroki Utsumi. (source: YukoYuko advertising brochure)

  • Iki Iki is a magazine for 50+ readers whose subscription base is 47% septuagenarians. Their e-commerce site: http://www.e-ikiiki.jp/ec/ proves that the older customer is just as responsive to trends as younger women. For example, oil supplements and oil drinks is a popular health trend among younger women. The same products are popular on Iki Iki as well. “Our readers are particularly responsive to trends in healthcare products,” says Junichi Tsuchiya, Executive Officer of Iki Iki. (source: CarpeDiemJapan interview)

  • Egao Shashinkan http://egao-shashinkan.jp/ is a photo studio for older people that opened in March 2014. They offer a make over and photo shoot package at 19,800 yen and 2 hours a session that is popular. According to Akiyoshi Ohta, Representative, approximately 75% of the clientele are over 70 and 90% are women. While many customers choose to have photos taken as funeral portraits, most come in groups with friends. The photo studio is run entirely by men and the female customers enjoy being pampered by them. The studio currently enjoys over 80 bookings a month since the beginning of this year. (source: the Nikkei Shimbun)

  • At El Viento Flamenco Studio in Nara, http://www.elviento-flamenco.com/index.html , there are classes for women aged 70 and above that is extremely popular. The school offers classes to students of all ages, but the two classes for these older women have the lowest turnover with approximately 20 students. The school hosts a major performance for all its students on a biannual basis, and the older students are the most lavish when it comes to costumes. Some will actually travel to Madrid, Spain to order one and the others don’t buy ready-to-wear, either. When the school hosts special lessons by inviting teachers from Spain, the senior women are usually the most committed to these extracurricular programs that run every day for a week or 10 days. “I love the dance, I love doing it with friends who share the same passion. Sometimes, I feel more comfortable being with them than being with my husband who has been working long hours for more than 40 years since we spent little time together - we were both busy. I was busy with the children and he was working,” says Emiko Wada, 75. (source: CarpeDiemJapan interview)

  • According to a survey by Hakuhodo DY Media Partners, Hakuhodo HABIT 2013, septuagenarians on average have 53,000 yen per month that they can spend freely vs. 35,100 yen for their working age counterparts. And while men tend to spend more time at home, women are more active. They grew up as the Japanese economy was picking itself up after World War II. They enjoyed themselves during the Bubble Economy, and they are keen to stay active and are not shy to spend. 

The Japanese senior consumer has long since parted with stereotypes about age and how senior citizens should dress, act, and spend. They spent the last 40 or so years “saving up for old age” and now they are cashing it in. Women aged 70 and above are now 10% of the population, but by 2050, they will be 18% - or, one out of every five Japanese person will be a woman aged 70 or higher. Is your brand/product really just for younger adults? Have you prematurely excluded seniors as a potential target without exploring the possibilities with this affluent consumer group?


Department store Matsuya has started offering higher quality premium products at a 10% discount on the 15th day of every even month - the day pensions are paid. As a result, they are seeing year on year growth of 10% or higher on those days. Other potential services septuagenarians appreciate in retail is the interaction with the sales staff. More staff and more rest areas (couches and benches) and creating a seniors friendly environment is a powerful differentiation factor.  


A New Wealth - Celebrating the Mundane with "Unseen" Luxury

$100 for a box of tissues... $300 for a coat hanger... $30 for an ear cleaner... $100 for eight rolls of toilet paper. These are among the best selling luxury items in Japan today, many of which are doubling sales over the previous year. Combine the words "luxury" "daily items" and "gifts" at Rakuten or Yahoo, and the list includes $70 packages of 20 disposable masks (a must-have during winter and pollen allergy season), $90 plastic umbrellas, and $10 tooth brushes as well. 
"Hanebisho" toilet paper, by Mochizuki, and its fans say "you only need to try one roll to understand the difference." Launched in 2007, the luxury toilet paper is made of the finest materials and treated in the clearest of waters. The company spends five to ten times the average time to dry the paper, conducts rigorous testing, and only 30% of what is produced makes it as final products. In the first five years, such extravagance appealed to only a handful few, but once the product began to appear on TV shows as "the ultimate toilet paper," sales began to take off, and 2014 sales doubled that of 2013, according to Mochizuki. 
Daishowa Shiko's "Juni-Hitoe" tissues, $100 a box, is another such item. The 4-ply tissues are made of much thinner paper than your standard "soft tissues," and the vivid twelve-colour selection is in accordance with its name, which is actually the traditional costume of Heian Era princesses and the ladies of the court whereby women layered 12 garments to create one outfit. The boxes are also scented with traditional incense, gift wrapped accordingly (as per the image above). Launched in 2014, the company has sold approximately 1,000 of the goods in the first year. 
Women are not the only big spenders on luxury daily goods. Luxury wooden coat hangers maker Nakata Hanger has a loyal following of men. 
Priced at $15 to $300 a piece, Nakata initially sold hangers to boutiques and fashion companies. But started selling directly to consumers from its showroom eight years ago. In 2014, showroom sales grew 20% over the previous year and 50% online. The majority of Nakata's clientele are men. 
In an interview with the Nikkei Marketing Journal, a 28-year old man said, "I like to buy it as a reward for myself when work goes well." He spends around $5,000 a year on clothes and is now the proud owner of seven Nakata hangers. He says that when his clothes are hung on good hangers, "my favourite clothes look good and I love the feel of wood. Even when I am not wearing my clothes, seeing them hanging in good form makes me happy."
In Japan, we have always had the element of "dressing up the unseen sides of kimonos" in our genes. The "haura" or the lining of the kimono coat is a key element when creating and dressing in kimono for men. 
Women also took care in choosing the motifs and colours of the lining of kimono as well. It is not just about what you show, but what is there; and taking care of the unseen with such care. Once upon a time ago everything made in Japan and Japanese master craftsmen were about such details. We seem to have lost a lot of that in the name of economic competition and "development." While we have been surpassed by China as the world's second largest economy, we may finally have begun to enter a new phase of "wealth" - a society where people are not feeling guilty to indulge on the unseen for themselves in their daily lives; and not just saving the best silver for special occasions, but rather, we are celebrating our daily lives in small ways. And of course, it is only elegant if one does not brag that one wipes one's behind with $100 toilet paper!


Same Day Delivery Now Cost of Doing Online Business in Japan

Japan is a small country - only 1/25 the land mass of the US of which only 28% is arable, which results in a high concentration of population that creates mega metropolises like Tokyo and Osaka, so even B2C delivery is not as geographically challenging as in the US, but that only means that consumers are willing to pay less - or nothing for same day delivery. And if one cannot offer it, then you may not even make it on the playing field here.

 It has been a while since amazon.co.jp offered same day delivery of goods in their warehouse where we could order by 11 am and receive the items at 17:00 the same day. To realize this, they have built their own warehouse network throughout Japan, and hold Sagawa and Japan Post to contracts that guarantee delivery times.

Image from NHK broadcast on 19 February 2013

Stationery specialists Askul is thus named because the goods come "kuru" tomorrow "asu." Askul's consumer services site (Askul is for businesses) LOHACO, a jointly operated business with Yahoo Japan, has commenced same day delivery as well, and now enjoys three peaks in the course of the day for transactions - once during the traditional online retailer peak of late evening; once between 7 am and 10 am - deadline for same day delivery; and early evening when commuters shop on trains via smartphones. 55% of their customer base is women, many who work full or part time. This is unusual as most "general store" type malls have a higher ratio of male clientele. They now enjoy a turnover of 1 billion yen a month (just under USD 10 million).

Yodobashi Camera (who actually sells a lot more than cameras these days) offers free delivery, but if one is willing to pay a premium, delivery as fast as three hours from time of order is possible so if your PC or phone or TV happens to break down, you won't be without them for long. Some people have ordered suit cases because they needed it for a trip the following day. The three-hour service is realized through the hiring of a chartered truck, but their ordinary deliveries are controlled by in-house specialists who monitor the weather and traffic conditions and plan to ensure peak performance at peak times.

Online fashion mall, ZOZO TOWN, who does not charge for delivery, is aiming to offer same day delivery for 40% to 50% of their goods by end of 2014. 

They found that 80% of their customers choose the earliest delivery slot when given a choice, so it was a logically derived conclusion that most customers want same day delivery - free of charge, of course. 

Size of selection and price are still powerful drivers that bring traffic to e-commerce sites, but such elements are becoming less and less effective to realize differentiation. 

Unlike some other markets, where faster delivery can fetch a premium or additional fees from consumers, in Japan, where convenience is a powerful currency, same day delivery is becoming a cost of doing business in the big league.


Japan is Becoming "the Land of the Free" Again

I am not talking about the freedom of speech or the freedom to meet... but that businesses are turning to the one tactic that helped spread mobile phone ownership lightning fast - FREE MOBILE PHONES - to other business areas now.

Namely, Yahoo has announced that merchants will no longer need to pay to sell on Yahoo! Shopping and Yahoo! Auctions.

There is a lot of controversy around this since it was announced:

On the one hand, advocates believe this will give Yahoo! a badly needed boost to catch up with front runners Rakuten and Amazon.co.jp

Antagonists are convinced that this will fill up the space with lots of crappy merchants and chase good business away to the very people Yahoo! hopes to conquer; the theory that bad gold will chase away good gold.

The verdict is still out, but Yahoo is busily promoting away. 

Another interesting FREE campaign is cable service provider J:com's 100,000 free tablets giveaway campaign. 

They seem to have teamed up with Huaway for the free 100,000 units. (Users can choose SONY as well, but that won't be for free.)

Of course there is a catch, that one must sign a one-year contract, but we are all familiar with these thanks to the mobile phone companies, one of which has a strong tie-up with J:com, au.


Next Logistic Wave: Shared Logistics Services by Newly Independent Subsidiaries of Manufacturers?

It is said that one of the reasons why 3PL services in Japan have not done as well as expected is because most major manufacturers and retailers have their own logistics companies as subsidiaries. Still, according to ongoing research by an Industry Publication from 2005, 3PL services have been growing at an average rate of 9.45% per annum from the start of the survey.

However, it is now believed that their main source of growth, dedicated distribution centers for large retailers, have now come to hit a ceiling. According to Masahiro Oya, Publisher of Monthly Logitsics Business, there is no decline in the number of orders received, but each project is getting smaller and smaller. He also points out that existing centers are suffering from a fall in volumes.

He analyzes that the 3PL service providers need to go upstream to the manufacturers to continue to grow. But the large manufacturers have their own subsidiaries that specialize in providing logistics services.

The key difference in the way 3PL has been growing in Japan vs. that in Europe is in that while European manufacturing businesses opted to outsource non-core operations in the form of endorsing 3PL, the Japanese market has grown in quite the opposite direction. It was not the manufacturers, but retailers who wanted to take advantage of their purchasing power by collating all their purchases in a warehouse, and then break bulk and ship to their various stores efficiently that embraced 3PL.

But that has all now come to a head, it seems...

So, will manufacturers be able to cut their logistics subsidiaries loose so that they can go ahead and offer their services to competitors as well?

Will such former subsidiaries, once cut loose, become prime acquisition targets for the likes of Sagawa and Yamato? - Maybe not as especially Yamato likes to build everything in-house.

Japan Post tried acquisition and learned the hard way that service disruptions due to tatty integration processes are a much higher price than it wanted to pay.

Either way, a new trend will emerge in the Japanese 3PL market because not having one is not an option if the industry wants to continue to grow.


New Trend? EXTREME Commutes

An Australian friend who works as a mountain climbing guide in Nepal told me once that the extremely hard core climbers are usually Japanese... Doing something in the extreme, in a way, is a Japanese trait.  Why else would we be known as the market with the most demanding consumers in terms of quality, convenience, and hospitality?

EXTREME Commuting is a hash tag on Twitter that is gaining popularity.

The idea is to play first and work later - on week days - and tweet about it.

Let's look at a day in the life of self-proclaimed leaders who spearheaded the hashtag/trend. They are two men, aged 29 and 34.

At 5:20 am, the duo meet up at Kita Kamakura Station, some 50km outside of Tokyo.  Takahiko Shiina, aged 34, has left home at 4 am. His partner, Sota Amatani, aged 29, left Tokyo the night before and spent the night at a manga kissa, or coffee shop that specializes in providing private space and lots of comic books.

They head to an old Zen temple, Enkaku Temple. It is the first time for Amatani.
Their EXTREME Commute on this day started with a one-hour zen meditation.

Then, they moved on to Yuigahama beach just after 7:00am. Shiina rolls up his trouser legs and Amatani strips down to his boxer shorts and the two splashed about for around 5 minutes, though they claim "it felt like half an hour of fun!" They progress to using Shiina's tie as a blind fold to try to break a watermelon with a baseball bat - a traditional summer beach picnic event.

They manage the break the watermelon open on the fifth round of trying and lap up the fruit like a pair of hungry dogs, according to a Nikkei reporter who was with them and who reports on their EXTREME Commute of the day.

"I feel like I am at the extreme opposite position of a white collar worker right now!" proclaims Amatani.

Though the clock is ticking, the pair insist on wrapping up their excursion with a bowl of ramen noodles. They rush into a noodle shop before 8 am and devour their meals in under 5 minutes to catch the 8:12 train to Tokyo.

The rule is to play hard and never be tardy for work, they say.

Their EXTREME Commute started as a fun discussion over drinks. Now, they may have up to 10,000 followers checking their tweets on their latest adventure with other people sharing their EXTREME Commutes.

From 2 through 6 September, the duo called out to their followers to participate in an EXTREME Commute-athon. More than 100 groups have joined so far.

"It is more refreshing than taking a day off" because every minute counts and there is no dilly dallying around, it seems. And another important factor is to "try" and "challenge onself" to do new things.