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1.29.2013

Do I Need SNS Rehab? ~ 30+% Probably Need It, But They Say "No, No, No!"


Research firm, NEO Marketing released survey results on 1,000 consumers in their 20s through 40s on how they feel about using Twitter, Facebook, LINE and other SNS services. 
According to the survey, 57.2% of men and 70.8% of women replied that they harbour some dissatisfaction about their SNS.
NEO Marketing: Blue is YES and Red is NO to the question, "Have You Ever Been Unhappy With Your SNS?"  Multiple responses accepted, and n=1,000)
「あなたがSNSを利用して不満に思ったことはありますか?」(複数回答 N=1,000)
Specific reasons for dissatisfaction are:

  • People I never heard of send friend requests
  • I feel tied down to my SNS
  • If anyone responds to my posts, I cannot help looking at it
  • Being on SNS means other people become aware of my digital footprint

By age group, the percentage of people who said they want to take a break from SNS are:
  • 24.5% of women in their 40s vs 22.8% of men
  • 26.5% of women in their 30s vs 28.4% of men
  • 37.9% of women in their 20s vs 38.6% of men

NEO Marketing: Q9. When currently using your SNS, do you feel you want to take a break from it? (Single responses only) Yellow - YES, Blue - Neither, Red - NO; Bottom are women and top are men in the respective age groups
 The article interviewed a psychiatrist in Ginza, who said, "We have some patients who come to us which obviously look like their problems are caused by SNS. It is a new psychological problem called "Social Harassment" that requires attention." He recommends "Social Detox" to prevent serious problems. 
"The survey results show that more younger people are wanting time off from SNS, and 50% have said that they find it a hassle. 
To continue to enjoy using SNS, for example, I recommend that people stop using it before going to sleep and switching off on Sundays and instead, spend the time doing something you really enjoy without worrying about what other people may think about your doing it. "
The following graph maps the responses to the question, "Do you feel it is a hassle to use SNS?"
41.9% said "Somewhat true" while 9.7% said "Very true," thereby indicating that more than 50% feel it is a hassle to a degree. (Green is "neither," purple is "I don't think so," and light blue is "I don't think so.")
NEO Marketing: "Do you feel it is a hassle to use SNS?"
「現在SNSを利用していて面倒に感じるときがありますか?」(単数回答 N=1,000)
In terms of using SNS in the future, 66.5% said they want to maintain their current frequency of use. 
It seems many feel it is a hassle and harbour dissatisfaction, but they feel obliged to continue to use it as a means to stay connected with others.
NEO Marketing: "How do you feel about the frequency of use of SNS in the future?"
From the top: I want to use it more; 
I want to maintain my current frequency of use;
I want to continue to use it but less frequently;
I want to stop using it for a while and then go back; 
I want to stop using it
「今後のSNSの利用に関してあなたのお考えに近いものをお答えください」(単数回答 N=1,000)
### CarpediemJapan Observations and Comments ###

According to the Ministry of General Affair's 2010 JOHOTSUSHINHAKUSHO (White Paper on Information Technology Use), checking email and web sites are still the top objectives for Japanese consumers to go online at the time of the survey (end of 2009). (See diagram below. Left is on PC and Right is on Mobile.)

Though SNS access is showing an increase both for PCs and online, they are 5.8% on PCs and 4.8% on mobiles vs 55.6% and 52.8% accessing the Internet to check emails (excluding the reading of ezines).

Of course, significant increase in the number of smartphones sold in Japan has occurred since the time of the survey, and when looked at by age groups, the 20-somethings have a much higher level of using SNS via mobile phone.

図表4-1-1-10 インターネットの利用目的(複数回答)
According to BCN Ranking, the percentage of smartphones sold out of the total number of phones sold has been steadily increasing from 20.4% in 2011 to 50.7% in 2010 and 72.9% in 2012. In November 2012, it has hit a record 80.9% before slightly declining to 78.6% in December as the simple phones for seniors enjoyed a slight rise that month.

The graph below shoes the trend in the iPhone sale index (1 = the number of units sold in week 3 of September 2012, the week iPhone 5 was launched) in red vs. the smartphone sales index in gray.

BCN Ranking Index Trend from 2012 September week3 
Smartphones are likely to continue to be around 80% of total new mobile phones sold in Japan in the foreseeable future, and SNS use will probably increase.

Given the high level of engagement SNS require, there are obvious generational preferences among SNS with LINE being more popular among people in their 20s (one estimate puts the gender ratio at 60% women), and Facebook appealing more to the older generation. Mixi is still on a slippery slope and working hard to win back users as well as advertising dollars. (LINE is pulling in 350 million yen in one to two months through the sponsored stamps programme alone, stealing much thunder from Mixi and other media.)

References:
My Navi News (contributed articles by NEO Marketing)
脱SNS疲れ!「ソーシャルデトックス」のすすめ | キャリア | マイナビニュース
「SNSに不満」が64%!SNS利用者の本音

Searchina (BCN Ranking):
2012年12月&年間の携帯電話ランキング、iPhoneが圧倒的シェアでトップ

1.24.2013

"We'll Give You the Tablet PC for (Almost) Free, But Sign a Long-Term Content Contract" Says NTT Docomo - The Nikkei Asks: Will NTT's Tablet PC Strategy Save Struggling Tablet PC Makers?


When mobile phones took off in the Japanese market to quickly become THE personal media device it is today, the market was flooded with 0 yen phones that came with two-year service contracts with mobile phone companies, during which time the consumer will not only pay for the phone in installments, but the retailer of the mobile phones would get a kick back from the mobile phone companies for a percentage of the phone bill. 
It seems NTT Docomo remembered their success through this strategy, and is going to try it again but this time with tablet PCs and video content contracts. 
NTT Docomo announced on 22 January 2013, that it will be releasing 12 new devices this spring: 9 smartphones, 2 tablet PCs, and one Wi-Fi router. Given that the INFOBAR, to be announced on 24 January, is the only model KDDI (au) is releasing, and Softbank has 3 models including the AQUOS PHONE Xx in the pipeline, NTT stands out with its breadth and width.In addition to the range of new models to be released, NTT Docomo will be promoting a "multi-devices for households" strategy featuring a low-priced tablet PC. If NTT Docomo succeeds in revving up demand for tablet PCs, it may become a very welcome blessing for the electronics manufacturers who are struggling to boost their tablet PC sales, says the Nikkei.
At the press conference announcing the new models, President and CEO of NTT Docomo, Kaoru Kato vouched for the Xperia Z by SONY Mobile Communications. 
NTTドコモが発表した「Xperia Tablet Z」(上)と「Xperia Z」
From the Nikkei 24 January 2013 Edition, the Xperia Tablet Z (above) and Xperia Z
画像の拡大
NTTドコモが発表した「Xperia Tablet Z」(上)と「Xperia Z」
The Xperia Z is the domestic model of the very same Xperia Z presented in Las Vegas by SONY. Moving away from the curvaceous design of its predecessors, the Xperia Z is very linear. To give it a sophisticated look, it is made of glass on the back and the power button area is made of aluminum.
The Xperia Tablet Z sports a 10-inch screen and weighs only 495g. 10-inch tablets to date are not suitable for mobile use, but by reducing the weight to under 500g, it may become acceptable to be taken out of the house. 
The two Z models are designed with a similar look and feel, and SONY hopes to make a dent in the tablet PCs markets now dominated by Apple's iPad. 
Another model that stands out from the new products lists is NEC Casio Mobile Communications' MEDIAS W, which sports a double screen structure. By opening up the smartphone with the 4.3-inch display, two screens adding up to 5.6 inches can be used. Users can read emails on one screen while browsing on the other, for example. 
Double screen smartphones first came out at Mobile World Congress in Barcelona in February 2012. NEC Casio seems to have had ongoing discussions about them with the mobile phone service providers around the world since. 
However, at the time, there were few believers in the feasibility of such a phone. Many thought it is just a concept model and was still far from ready for practical use. Yet, NEC Casio managed to realize a practical model within a year of its debut as a concept. NEC Casio has always had a focus on making phones thinner, and it seems their efforts took shape in this double screen phone. 
Of course it is yet to be seen whether consumers would actually vote with their wallets in favor of such a phone. The double screen looks cool, but how useful can it be?
The Nikkei suggests that NTT Docomo is the only mobile phone service provider who can take such gambles, as both Softbank and KDDI (au) are too focused on the iPhone to be adventurous in the Android market. 
The Nikkei says that for a while, NEC Casio looked to be lost in its quest to secure business, especially when it released a collaboration model with popular animated film, ONE PIECE.
NTTドコモが発表した2画面のスマートフォン「MEDIAS W」
The double-screen smartphone, MEDIAS W by NEC Casio; excerpt from the Nikkei 24 January 2013
画像の拡大
NTTドコモが発表した2画面のスマートフォン「MEDIAS W」
But now that it has the standard model MEDIAS X and the very conceptual MEDIAS W (double screen phone), suddenly NEC Casio seems to have all bases covered - something basic to secure volume, something that appeals to youths, and something that will tickle geeks. 
Another point to be highlighted from the product announcement by NTT Docomo is its focus on a multi-devices strategy. It is obvious that NTT aims to expand its video broadcasting service through not just smartphones, but via other devices (a new tablet PC and a new terminal for TVs). 
The tablet PC dtab is Wi-Fi only and sports a 10-inch screen, but will be retailed at 9,975yen during the promotional campaign. The tablet PC market is still dominated by Apple's iPad, but Google's Nexus 7 and Amazon's Kindle Fire HD are 7-inch screen devices priced uner 20,000 yen. NTT Docomo is crashing that party with a product priced at under 10,000yen. 
The Nikkei says that this is proof that the tablet PC market is not at all one where hardware alone can bring in any form of success. Google wraps it up with its advertising business, and Amazon is focusing on contents and e-commerce via the hardware. The market is in a state where one must be able to widely spread use of the hardware quickly as a means to get consumers to access contents or shop through them to even get into the game. 
NTT Docomo is realizing this competitive price in exchange for a long-term contract to use its video contents service. In other words, NTT Docomo is focusing on securing volume fast to take in profits later through their contents business. 
To hit this price point, NTT Docomo chose Huawei Technoloogies of China as their manufacturing supplier. As Huawei was already producing 10-inch tablets, NTT's product had a short time to market. 
In the event a consumer opts not to enter the long-term video service contract, the device can be purchased at 25,725 yen. 
NTTドコモが発表した新型のタブレット端末(下)とスマートフォン。左のタブレットがdtab
NTT Docomo's new tablet PCs (below) and smartphones. The tablet on the left is dtab. Excerpt from the Nikkei, 24 January 2013
画像の拡大
NTTドコモが発表した新型のタブレット端末(下)とスマートフォン。左のタブレットがdtab
The Nikkei anticipates that if domestic manufacturers agree to the enhancement of promoting Docomo contents, Fujitsu, Sharp, SONY, Panasonic, and any other domestic manufacturer who is struggling to boost tablet PC sales may be able to sell such lower priced Wi-Fi only models through NTT Docomo. 
But will domestic manufacturers be able to hit the low price point, even if they revise their tablet PCs as Wi-Fi only models? Since NTT Docomo can buy large volumes, it may become possible. 
When asked whether NTT Docomo would consider having a Japanese supplier provide them with dtabs, Kato said, "We would like to consider it for the next generation models."
While NTT has mentioned the "i" word a few times, since iPhones and iPads are not in NTT Docomo's lineup or pipe line as we speak, they will need to continue to work closely with Japanese, Korean, and Chinese manufacturers to compete in the market where such American businesses as Apple, Google, and Amazon are dominating. 
The Nikkei says the lower priced, high volume strategy to disseminate NTT Docomo tablet PCs is the quick fix. 
### CarpediemJapan Comments and Observations ###
CarpediemJapan believes that the Japanese market may remain a predominantly smartphone and keitai market for the foreseeable future due to the nature of the way people commute/travel - using public transport. 
In addition, the fact that "everything that can be done on an iPad can be done on the iPad mini" is probably not reason enough for people to jump on the iPad mini. But it has increased the appeal of the iPad (mini or not) for non-iPhone users. But they are still looking at the iPod Touch as well, as part of their options. 
On the other hand, iPhone users probably feel that they can do everything they need to do in transit on their iPhones and it is much more convenient to carry around than either an iPad or iPad Mini. 
Unlike the US and other markets, Japanese consumers have one seg TV, and are used to watching TV and videos on their keitai phones, so the smaller screen is already widely accepted. And given that "privacy screens" - adhesive polarized film that is placed on the screens to secure some "privacy" in public places when checking one's phone - are a popular product, using larger screen products in public may not prove as popular as even NTT Docomo hopes. 
Today, PC use is not mandatory in most schools, including universities, but that is changing. When learning through tablet PCs in schools become a norm, both e-books (in the form of e-text books) and using tablet PCs will probably become more mainstream. 

Reference:

The Nikkei:
国内メーカーの活路になるか ドコモが打ち出すタブレット戦略  :日本経済新聞

1.23.2013

LINE Users Exceed 100 Million in 399 Days; Hosted Stamps Revenues Alone Exceed 350 Million Yen in a Single Month


So, where are brands putting their advertising dollars these days? TV? Newspapers? Facebook? - LINE is definitely a powerful contender for exposure and advertising yen!
At around 2:04 am on 18 January, 2013, the total number of registered users on LINE, the smartphone-based free voice calls and chatting app which is Japan's competitor to SKYPE and Viber, exceeded 100 million. The service was launched three months after the Great East Japan Earthquake and tsunami, in June 2011, so it took approximately 19 months, or 399 days for the service to grow to 100 million. Considering that it took Facebook 1,300 days and Twitter 1,100, LINE's growth is phenomenal. 
LINE Downloads
Approximately 40% of the users are Japanese, and the smartphone-based service is finding fans in Asia, the Middle East, and Latin America as well. The service can also be used on the PC and Mac, of course, but its core strength is on mobile devices. 
Another popular service in Japan is rival and gaming market leader, DeNA's comm. DeNA announced at the end of December 2012 that downloads of comm exceeded 5 million, a service released in October last year in 204 countries to compete with LINE. comm's edge is its claim to offer higher quality voice calls than LINE and that users can send messages via comm to friends who are not yet on comm, whereby the messages get delivered as email. 
LINE was kicked off in a bit of a haste to respond to a growing desire among Japanese people to "connect" after the disaster that devastated the Tohoku region. The popular "stamps" or cartoons and emoticons were not released at the time, but when they were, in October 2011, they significantly boosted the number of users. 
More Cartoon than Emoticons, Stamps has become a competitive advantage and key revenue earner for LINE

In response to there being many users using the bear and rabbit as a couple, LINE released a couple version of the two characters as an upgraded stamp series.

The stamps are not just emoticons, but use popular characters from animated films and mascots of brands. In November 2012, AppWoman reports that there are 3,200 such stamps on LINE at the time and revenues from the paid stamps @170 yen each, exceeded 350 million yen in September alone. That is more than 2 million stamps purchased in a single month. (Note: The Nikkei reports that the revenue is 350 million yen in two months...)
Excerpt from Nikkei Woman (see references section at end of article)
In addition to those, there are the "sponsored stamps" whereby brands offer their mascots and characters for use by their "friends" on LINE. They are a unique form of advertisement and LINE charges 10 million yen for such stamps to be posted for 4 weeks. This advertising medium is so popular, there is already a waiting list for businesses to secure slots. 
Yes, 100 million is a huge number, but what are their active users? LINE claims that 86.1% are active in a month and the daily active user rate is 50.0%. With users growing at a pace of 5 million every three weeks, there is no wonder that the stamp slots are full. 
In an interview with the Nikkei Business, NHN's CEO Akira Morikawa says that as users are not asked to declare their gender or age at time of registration, NHN does not know the exact age/gender breakdown and profiles of their users, but they feel that there are more women users while men are quite active as well, and with small businesses, some use LINE as the primary telephony platform among employees and as a mailing lists for announcements. 

In addition to free voice calls and chats, LINE offers game-playing, horoscopes, and coupons/vouchers through LINE Channel, a new service that was launched on 3 July 2012. 
LINE Game consists of role playing games (RPGs), puzzles, and games that enable users to collect and "grow" or "nurture" virtual pets, among others.
LINE Fortune Telling offers more than 200 different types of horoscopes, tarot readings, and romantic compatibility readings as well as a collaborated fortune telling service with popular women's magazine an-an.
LINE Coupon is a collaboration with Japan's leading coupon/vouchers provider for food and beverages, Hot Pepper Gourmet, operated by Recruit Co., Ltd. Users can search for restaurants and bars based on their locations pinpointed via GPS.
LINE Camera is akin to Instagram, and enables users to take photos with their smartphones, decorate and clip them, and then post them to LINE.
Usage for the various contents that require payments are transacted through the virtual currency, LINE Coins, which are purchased in advance. 
In July 2012, NHN announced that LINE is used in 230 countries and territories worldwide and that there are 1 billion messages posted per day. And that was before they added all the "Channels" as per above and became more of a SNS. 
If LINE is not yet in your media mix for Japan, then now is a good time to look into it, especially for the F1, F2, M1, and M2 groups of consumers. 
References:
Nikkei: ユーザー1億人突破のLINE、今後の展開は? | nikkei BPnet 〈日経BPネット〉:日経BPオールジャンルまとめ読みサイト
Nikkei BP: 無料通話アプリ「LINE」のユーザー数が1億人突破、開始19カ月で大台に
AppWoman: LINEついにキタ!ユーザー1億人突破!
これは大変!LINEの裏側を数字で見てみたら

1.22.2013

Docomo to Launch 10,000 yen Tablet to Eat Kindle's Cake, Which is NOT About Reading


The Nikkei reported on 22 January 2013 that NTT Docomo is planning to launch by spring, a competitively priced tablet (officially called a "multi-purpose mobile computing terminal") that will be priced at around 10,000 yen. It will be priced lower than the amazon Kindle Fire, selling at 12,800 yen in the Japanese market. 
NTT Docomo aims to put more tablets in consumers' hands so that their video and e-commerce services will reach a much wider audience. Apple and Google are already competing in the Japanese market, and competition is only expected to intensify.
Docomo's tablet will be manufactured in China by leading communication devices manufacturer Huwawei Technologies, and will have a 10-inch screen. The device will NOT support the high-speed LTE (Long Term Evolution) or 3G transmissions, and will utilize wireless LAN to connect to the Internet. The device will be available through all the Docomo Shops as well as major electronics stores. 
The Google Nexus 7 is priced at 19,800 yen while the iPad Mini is 28,800 yen in Japan. 
According to IDC Japan, tablet sales in Japan is expected to increase by 40% over 2012, to 5.61 million units. Docomo endeavors to take a significant chunk of that pie to increase access to its video streaming, social gaming, and e-commerce services. NTT Docomo operates its own e-commerce portal, "dMarket."
### CarpediemJapan Comments and Observations ###
Is price really the only deciding factor?
Although "it is not the iPad," the beauty of the Kindle Fire is its extremely user-friendly plug & play feature: your account is already set up on the Kindle when it first arrives. Let's hope Docomo had not overlooked that very important point, especially as Docomo users are traditionally the more conservative and older consumer. 
And how much software or apps can Docomo offer is another challenge they need to meet. 
It seems my then four-year old kids were not too far off when they referred to the iPad as "a giant iPhone."Since most smartphones in the market are already used more as connectivity devices and less as phones, I have heard interesting comments from 35 to 40-year old women who have been Docomo subscribers all their mobile-owning lives that have a smartphone but not an iPhone say, "I am thinking about getting the iPad Mini to access the edutational apps," and the like. When asked, their number one motivator to actually get an Apple device as their third "phone" or first "tablet" is the wide range of apps available on the iTunes store. 
So it seems it is not just the price or hardware functionality, but the software that really counts. (Not rocket science, I know.) And there seems to be plenty of grizzling about the lack of choices in the Android store. 
Another point that comes to light is that while the Kindle Fire is a pricing benchmark, but e-books and its digital reading functionality is not. (Note how Docomo plans to increase users accessing their video streaming, social gaming, and e-commerce services and the conspicuous omission of e-reading.)
According to an article in the Toyo Keizai, on 14 November 2012, there is not one digital reader that has done well in the Japanese market. To cut a long article short, the journalist, Jun Yamada, credits this to two idiosyncrasies in the Japanese e-book market: 
(1) 80% of e-books are manga comics, predominantly porn, which is a legacy of the Japanese "keitai" mobile phones market where such digital content were first distributed. Yamada claims that be it iPads or the Kindle, let alone SONY's Reader and Rakuten's Kobo, none of the e-book readers are optimized for reading manga. 
This also means that the majority of e-book readers in Japan are the manga generation, or young adults many of whom do not own PCs, TVs, or a land line phone, not to mention cars. Their wallets are already stretched to the limit in obtaining a smartphone. Another digital device is a luxury they are currently opting to do without. 
(2) It is near impossible for amazon to realize the kind of price cuts on digital editions over hardcover and paperback publications, seen as a key driver for consumers to switch from paper to digital in the US, due to the nature of the publishing rights ownership in Japan. Where in the UK and US, publishers own the right to price the books and distribute them and can assign those rights to a distributor (the wholesale model), in Japan, distribution rights are retained by the individual authors and publishers are agents of the author in an agency model. Which means that publishers cannot distribute books via amazon without the consent of the authors. 
Yamada suspects that the above two were blind spots for amazon in launching the Kindle devices here. 
I found it interesting how Yamada spends the first third of his article explaining how businesses have tried to promote usage of e-book readers, and yet, many of them are just collecting dust. I was personally very tempted to get a Kindle Fire HD Japanese version for myself, but ended up not getting one as my Kindle 2 US version is sufficient for me to take advantage of the lower prices on English publications and the fast online delivery. 
The graph indicates the total number of books (blue) and magazines (red) published in Japan by year, an excerpt from the 2010 Publishing Index posted on Garbagenews.com.  So, the Japanese market may be seeing stagnant growth, but it is not contracting; and it is not yet switching to e-reading en masse. 
↑ 新刊書籍・雑誌出版点数推移(全国出版協会・出版科学研究所:2010出版指標年報)
References:

1.21.2013

No Slowing Down for Japan's Retired for Hire


The so-called 2012 Problem seems not to have been a problem at all in Japan, where the labour participation rate for men aged 65 or older is 28.8%, the highest of all G7 countries. (According to the ILO, US is No.2 at 22.1% and Canada is No.3 at 16.2%)


The Nikkei published the graph, where the sky blue indicates labor participation rate and dark navy indicates those actually in the labour market. 

Back in 2007, as the Boomers (those born between 1947 and 1949) began to reach retirement age, Japanese society on the whole geared up for a mass exodus of healthy, able-bodied seniors from the labour market. But many employers enabled seniors to remain employed (though, most on much less favourable terms) through to age 65, and as such, we expected the mass exodus to only be postponed till 2012. 
Seniors have a lively appetite to continue working - The Nikkei 2012.01.21
画像の拡大
Once we hit 2012, it turned out that the average monthly employment rate from January through November 2012 rose 0.8 percentage points from the previous year, to 37.0%; and the labour participation rate, which includes those who may not currently be in employment but have the desire to work, also increased 0.8 percentage points to 38.2%. Both figures were the highest since 1999. 
In 2007, when those born in 1947 reached retirement age, the employment rate of those aged 60 through 64 increased 2.9 percentage points to 55.5%. The increase in 2012 was smaller than that in 2007, so it cannot just open-handedly be said that mass retirement did not happen, but still, there are an increasing number of economists, including Toshihiro Nagahama of Daiichi Life Research Institute Inc., according to the Nikkei, who are beginning to say that "the retirement of the Baby Boomers are happening at a much slower pace than aniticpated."
When temp services company, Human Resocia, headquartered in Shinjuku, Tokyo, launched a temp service especially for seniors, they received 500 to 600 applications from mostly those in their 60s. The most popular positions seems to be as "management advisors" drawing on experience and expertise.  
Resocia's staff commented that most applicants do not have a sense of need of monies to make a living, but they apply more because people want to put their experience to use or have too much time on their hands. There is approximately one position to every nine applicants.
The unemployment rate of those aged 65 through 69 in November 2012 was 3.1%, lower than the overall average of 4.0%. Still, Norichukin Research Institute's Takeshi Minami Senior Research Director is quoted in the Nikkei as saying that "if one includes the number of able people who would work if they had the opportunity, the hidden unemployment rate is much higher."
One out of Five Workers will be aged 60 or older - Excerpt from the Nikkei
画像の拡大
The number of people aged 60 and above have increased 30% in 10 years, to an average of 12.35 million during January through November 2012, on average. Minami emphasizes the importance of having sufficient measures in place to employ seniors in that "keeping them in the workforce will soften the shrinkage of the labour force due to our shrinking population, and as it will also stimlate consumption by seniors, there will be a positive impact on the overall Japanese economy."
On the other hand, there is, of course, the potential trade off with the employment of youths and young adults. According to a survey by the Keidanren, when it became fundamentally mandatory to extend the retirement age of seniors to 65, more than 30% of responding businesses said that they would reduce the hiring of younger employees. 
The Nikkei suggests that to counter this trend, passing on the knowhow of seniors to young adults and enhancing work skills training for free lance and part time workers are a necessary step.
### CarpediemJapan Comments and Observations ###
I had predicted in 2007 that there will be an increase in entrepreneurs aged 60 and above as a result of the Baby Boomers reaching retirement age, and as the self-employment rate in Japan (green in the graphs below) is on a steady decline, many economists (such as Kenichi Omae) and leading think tanks are calling for the need to provide avid support to enable this. 
(In the graphs below, (1) is the Self-Employment Rate Trends; and (2) is the same excluding agriculture, forestry, and fisheries. Red is the UK, purple is Germanu, lime green is France, and navy blue is the US). The excerpt is from the Japanese Cabinet Office Report of July 2011.)
第3-1-8図 自営業率の推移
Research on entrepreneurs by the Japan Finance Corporation, released on 25 December 2012, indicates that 12.1% of the 782 respondents to its survey conducted in August last year, were aged 55 or above (their definition of "senior entrepreneurs") shows that 22.1% of them have launched businesses in the medical and welfare sectors while food & beverages and accommodation was ranked No.2 at 14.7%. Such entrepreneurs look to utilize their experience and their financial goals are predominantly to earn enough to support their livelihoods than to earn as much as possible, in line with what the Nikkei reports as learnings through Resocia, above.  

1.18.2013

Online OTC Sales Legal Again - Japanese Supreme Court

On 11 January 2013,  Japanese Supreme Court nullified the ban on online OTC pharmaceutical sales imposed by the Ministry of Health and Welfare on the basis that the risks and side effects associated with such drugs cannot be explained thoroughly enough without face to face interaction between a pharmacist and consumers.

The historical chain of events leading to this ruling is as follows:

In June 2006, the Revised Pharmaceutical Affairs Laws were ratified by the national assembly. In September 2008, the Ministry of Health and Welfare announced the ban on nonstore retail of OTC drugs as they have a higher risk of side effects. In December the same year, Rakuten, Yahoo, and related industry bodies demanded the Ministry to revoke the ban and to enable them to continue to sell OTC drugs. They launched major signature collecting campaigns online. The Rakuten one was particularly memorable for me with Mikitani, CEO of Rakuten posting his own photograph and name on the plea: "There are people living in remote areas (among the 3,000 islands) of Japan who have challenges in getting to physical stores to get the medicine they need to better their welfare. Please do not let the ban on online sales of drugs stand for the sake of such people."

In May 2009, Kenko.com led peers in a group suit to secure rights to conduct nonstore retail of OTC drugs. The Revised Pharmaceutical Affairs Laws came into effect the following month.

In March 2010, the Tokyo District Court ruled in favour of the Ministry, agreeing that online sales cannot realize the same level of awareness of potential risks and side effects associated with such drugs.

In July 2011, while the Democratic Party of Japan was the ruling party, a Diet Directive to revise the regulation on pharmaceutical sales was approved.

April 2012 saw a 180-degree turn on the judicial decision as the Tokyo High Court overturned the District Court's ruling and ruled in favour of Kenko.com and its peers. The Ministry appealed to the Supreme Court in May.

The industry body consisting of drugstores in Japan publicly announced its new self-regulatory standards on pharmaceutical sales.

11 January 2013, the Supreme Court ruled in favour of Kenko.com and its peers.

###
The Japanese OTC drugs market is estimated to be around 600 billion yen per annum with less than 1% being sold online today.

Within two hours of the ruling, Kenko.com had OTC drugs available on their site.

Kenko.com firmly believes that drugs are the utlimate long tail product, and is an ideal category for e-merchants. According to the Japan Self-Medication Industry (association of 88 OTC drugs  manufacturers and a member of the World Federation of Proprietary Medicine Manufacturers), there are currently approximately 12,000 OTC items in the market today with head ache remedies accounting for several hundreds alone.

A brick and mortar store can stock around 300 different products due to restrictions on physical space, so Kenko.com's Genri Goto, CEO says, "such stores cannot fully meet customer needs." At Kenko.com, they have over 4,500 items available on the site.

Kenko.com's annual turnover is 17.1 billion yen, of which approximately 300 million yen was "indirect" OTC drugs sales that continued after the Ministry ban. The "indirect" system was one where Kenko.com would ship their goods to a subsidiary in Singapore before delivering them to the end consumer, a system established after seeking guidance of and securing approval by the Ministry.

It seems ironic that the Ministry insists that face to face communication between a pharmacist and consumers are a prerequisite for sales of OTC drugs to ensure that the risks and side effects are explained in detail as their own mystery shopping conducted in 2011 has proved that only 55% of pharmacies actually went through what the Ministry defines as adequate explanation of the potential side effects and risks of the drugs.

If pharmacists do not even try to warn their customers face to face, wouldn't a mandatory online pop-up warning of the risks that won't disappear until the buyer has clicked "I have read this and fully understand the potential risks and side affects associated with taking this OTC drug" be at least more effective in that it _will_ be displayed to begin with?

At the same time, the government is promoting the switch to OTCs from prescription drugs as a national initiative to help reduce healthcare expenditures with major "Switch OTC drugs" in the pipeline for release this year.

Unlike the US, online drug sales are extremely low in the Japanese market today with less than 1% of overall sales being through the online channel, but this ruling will definitely impact the retail environment. Kenko.com's Goto says that "price competition may become severe if online sales reach 20% of the total market."

The ruling and the easing up of Ministry restrictions will also make the entry barrier lower for other retail channels to enter the market. Already, such major retailers are responding to such threats as Segami are undertaking e-commerce development initiatives while Tsuruha has acquired online and offline drugstore chain Wellness Kohoku of Matsue city with over 20 brick and mortar stores as well as an online business.

Kenko.com currently ships free of charge for purchases exceeding 1,980 yen while 290 yen is charged for shipping of lower transactions. They have one warehouse in Fukuoka and shipments are made on the next business day after transaction, based on the assumption that most drugs are purchased to replenish household stock and thus there is less need for same day deliveries.

However, if the likes of amazon.co.jp who offer same day delivery enter the market, it is highly likely that consumer expectations and purchasing behaviors will change.

Rakuten, parent company of Kenko.com, along with Seven and I Holdings (owner of the Seven Eleven chain of convenience stores and Itoyokado supermarkets), Familymart (convenience store chain), and Lawsons are also gearing up to jump on the band wagon. Lawsons has entered a strategic alliance with prescription pharmacies chain Qol in preparation to roll out OTC sales through the convenience store channel.

At the approximately 45 directly operated Natural Lawsons outlets and franchise stores run by Qol, already there are video phone terminals in the drugs sections whereby consumers can speak with a pharmacist 24/7 remotely to receive advice on what drugs to buy.

The pharmacists that respond to these calls are currently located in the Qol stores that operate 24 hours a day. But Qol is looking to establish a dedicated call center of pharmacists to better support this operation in the near future. If they are able to take on call center contracts for other retailers, this may result in significantly reducing the entry barrier for OTC drug store operations whereby retailers will only need to secure a pharmacy license to open such stores. As the Supreme Court ruling has overturned the basis of face to face sales, there is a high likelihood that such remote support using video phones would be accepted as sufficient for sales of OTC drugs.

The Japan Online Drug Association (JODA), an NPO with approximately 30 e-merchants of drugs as members and led by Genri Goto of Kenko.com as President, is in the process of establishing guidelines for asking for information of consumers on their health and symptoms as well as monitoring excessive purchases.

In November 2012, it came to light that supermarket chain, Seiyu falsified the applications of 80% of their employees taking the pharmaceuticals sales license exam, enabling people not qualified to take the test to do so. This highlighted how retailers may put servicing the convenience of consumers before safety. In response to the Supreme Court ruling, consumer rights advocates are calling for new strict guidelines to ensure safety.

References:
Nikkei:
大衆薬ネット通販、「未開の地」開拓狙う各社 ケンコーコム勝訴確定で号砲

厚労省を指弾した市販薬ネット販売判決  :日本経済新聞

Nikkei Marketing Journal 14 January issue

1.17.2013

60% of Japanese Feel Positive About SNS in 2013 - Dentsu Survey


Dentsu Public Relations (Dentsu PR) released on Christmas 2012  its projections for the SNS Industry in Japan. According to survey results conducted by the company, more than 60% of respondents showed positive outlook about SNS use in 2013 including anticipation to increase usage and expectations of expanded applications. Only 20% had negative feelings about SNS.
The best known SNS are Twitter (98.7%), Facebook (98.4%), and mixi(95.9%) - each enjoying awareness of over 95%. Social gaming services such as Mobage scored 94.9% with GREE at a close 91.5%. The highest rated "free calling services" was LINE, scoring 76.5% and leading by a wide margin over their competition. 
The open-ended question, "What is your future outlook on SNS in 2013?" received 65.3% positive responses such as "SNS will become the main mode of communication," "SNS and TV will tag team and programmes will evolve," and "there will be more advances on utilizing SNS for prevention of and responding to disasters." Dentsu PR saw with as an overwhelming positive outlook by the respondents. 
Negative comments, on the other hand, were: "people will tire of SNS and move on," and "SNS will cause problems among individuals in managing their relationships to others," and accounted for 23.9%.
In terms of actual SNS usage, 41.7% said they currently use Facebook either every day or on occasion, and 40.5% said they use Twitter in the same way. While teens led by a wide margin in the age/gender segmentation for usage of Twitter with more than 60% saying they use it regularly; for Facebook, there was no age/gender gap from teens through to people in their 40s, indicating that it is more uniformly used across the segments. 
Dentsu PR anticipates SNS to become more "compartmentalized" and "specialized" in that it will become less of a means for information dissemination or ubiquitous and more "anti-ubiquitous" as more obvious "groupings" emerge and the information shared becomes more in-depth and specialized. 
The survey was conducted by an in-house cross-sectional group called "The Social Media Laboratoy 'Antenna'," established in June 2012, as an online survey. Men and women aged 15 through 60 were selected for the research. There were a total of 1,339 effective replies and the survey was conducted from 22 through 28 November. 
### CarpediemJapan Comments and Additional Related Facts ###
In September 2012, the Hakuhodo DY Group announced SNS users survey results (n=1,080) that 30.5% of SNS users are on smartphones while 57.6% use PCs.
The younger age groups have a higher propensity towards accessing SNS through smartphones with 49.4% of teens and 42.9% of 20-somethings vs. 30.9% of people in their 30s, 20.0% of people in their 40s, and only 14.2% of people in their 50s. 
PC use to access SNS increases as the users get older: 42.1% of people in their 20s, 54.6% of those in their 30s, 73.5% of those in their 40s, and 79.7% of those in their 50s. 
Tablet usage is less than 10% in all age groups at this time, with the 2.8% in their 30s being the highest figure and those of the other groups being less than 1%. 
Twitter in Japan definitely enjoyed a huge boost in recognition after the 3.11.2010 Great East Japan Earthquake and Tsunami, where Twitter was seen to be the fastest and most effective way for people to share information on events when major communication channels (mobile telephony, etc.) were down or overwhelmed. 
Mixi has lost a lot of ground to Facebook in 2012 and is struggling to change its downward trends as advertising revenue plummets. 
Gaming sites lost much credibility last year as "Gachapon" games became first a social phenomenon then a major social headache with reports in the media claiming that minors had racked up bills as high as 1,000,0000 yen trying to "win" rare cards. 
LINE continues to make headlines as it promotes its commercial accounts with Lawson's being a successful first mover who is happy to share its "O2O" (online to offline) success stories. 


2013年のSNS、前向きにとらえる人が6割:電通PR調査 - トピックス:ITpro Active

1.10.2013

Are Japanese Women Finally Growing Out of "Kawaii?"

The Nikkei just ran an article this week focusing on the hidden consumption appetites of the "New Around 40s Women." These are our 2nd generation Baby Boomers born between 1971 and 1974 who have come of age after the Bling-Bling 80's ("The Bubble Economy" era) and have been thought to be more frugal, less likely to carry luxury brand handbags, and are sometimes referred to as the generation that got the short end of the stick.

The article draws on survey results run by Sankei Living, a publisher of free newspaper "City Living" widely read by working women, and a marketing writer, Megumi Ushikubo, conducted four times from 2011 through 2012.

The survey results ran counter to the common belief that this generation is not interested in flashy consumption, and that they relate more to the Bubble Economy generation (74%) than to their younger peers, known as the "Yutori" or "Easy-Going" Generation (so called due to the "Yutori Education Curriculum" introduced by the government to reduce the stress on children).

The article says this generation's purchasing decisions have three triggers:

1) Being a smart shopper based on individual values
2) Extremely time-poor; and
3) Individual consumption.

Representative examples of the first are comments like
"I dress in simple blouses at work but splurge on my favourite clothes for the weekend,"
"I pay 70,000yen a month on rent for a simple apartment, but I own a horse,"
"The bag I take to work is 1,500 yen but I have more than 10 luxury brand bags in my closet."

This kind of consumption behavior is referred to as "closet splurging" and is clearly differentiated from the very obvious way the Bubble Economy generation spend on themselves; i.e. it is rather easy to understand the preferences of the Bubble Economy generation by just looking at how they dress and what they carry whereas the new Around 40 women have a side they do not readily show to the outside world.

The second results in multi-tasking. Because this generation got jobs when the job market was lean, their workload has always been quite full. Multi-tasking or finding snippets of time to take care of chores is a norm - hence they surf the Net on their phones while commuting, they watch TV and surf the Net on their mobiles at the same time, and so on.

The last is an interesting tendency as only 27% of them are single. The majority of these women are those who have never married, but there are an increasing number of women who are single after divorce. But regardless of their marital status, these women tend to allocate a portion of their spending on things they alone can consume. They tend to gravitate towards facilities that offer childcare so they can enjoy themselves for a time and have no qualms about being a "single wife" so to speak.

In the Japanese market, where there are over 70 fashion magazines, each targeting a narrow age and taste group (for example, PRECIOUS is targeted at women aged 38 to 42 and is a glossy fashion magazine that features Koyuki, a Japanese actress, on its covers instead of the foreign models featured on VOGUE, ELLE, and other "imported" glossies), a new title, DRESS, targeting single working women, will be launched. The focus will be more on "the handsome woman" and not the women who aspire to be eternally "kawaii."

「隠れバブラー」団塊ジュニア女子の消費促すツボ  編集委員 石鍋仁美 :日本経済新聞

On 1 December, 2012, a fashion show targeting women aged 40 and above, "The Madam Show" was held in Tokyo's Shibuya. 14 fashion brands catering to this group participated, and a total of 1,600 women attended the event.

Like the extremely popular Tokyo Girls Collection, the show featured "real clothes" for the current (winter 2012/13) clothes and the participating brands set up stores in the adjacent exhibition hall to enable customers to purchase the items they just saw on the runways.

The theme for "The Madam Show" was to offer "elegance and sophistication along with trends that are much more than kawaii," according to it's Creative Director and TV celebrity, Terry Itoh.

So, our 2nd Generation Baby Boomers are less into Bling, but are not exactly as frugal and stingy as commonly believed... (We had already been seeing signs of that with there being a strong tendency for such households to "splurge" on very specific items like "rice bought directly from the farmers" and "water from a particular area of Japan" and so on).

Trend-grabbing marketers are looking beyond "kawaii" to appeal to them.

Are we finally growing out of kawaii?