I have been following with interest the prospective launch of Jetstar Japan. Jetstar, a subsidiary of Australia’s flag-carrier Qantas, is widely recognized as being one of the most successful low-cost airline start-ups in the world. The new “Jetstar family” airline, which is a joint venture between Japan Airlines, Mitsubishi and Qantas is expected to start flying this summer.
With powerful domestic partners, and a clear need for a consumer value story in Japanese aviation, the ingredients for success seem to be in place. Nevertheless Japan is a graveyard of brands with successful and established business models overseas that, when transplanted to Japan, did not meet with success.
A large part of the problem is when brands entering the market do so either ignorant of or not sufficiently respectful of the different values that underlie consumer behaviour in Japan. Making some degree of adaptation to account for differing needs and values related to your product, and sometimes your broader approach to doing business, is usually critical in both getting off the ground and in building the foundations for lasting success.
A useful thing to understand is that, when it comes to spending money, the Japanese tend to reflexively adopt a defensive posture. In Japan, it can be far more important to cause no upset to yourself or others than it is to meet a need or solve a problem. For this reason, Japanese buyers always “look before they leap”; and they place a high premium on trust in order to allow them to make the leap. In Europe or the US many consumers may not realise that the ice-cream or shampoo they are buying is owned by P&G or Unilever. Such ignorance is rarely the case in Japan, and much advertising in Japan specifically includes an all-important closing reference to the manufacturer or parent company. Who you are matters, and for those entering the market the dimension of trust should be dealt with before any other.
In this sense, Jetstar’s strategy of hitching themselves to JAL’s albeit somewhat tarnished post-bankruptcy star seems to make a lot of sense. Apart from the obvious regulatory and operational wrinkle-smoothing JAL can offer the new airline, there is a significant short-cutting of the effort needed to convince consumers that the new airline is legitimate.
The other star that Jetstar has hitched themselves to is the popular half-Japanese “talento”, Becky. Outsiders often wonder why Japanese advertising seems to rely so heavily on the use of celebrities, including some of the biggest name stars from overseas (who would not be seen dead endorsing the same types of products in their home countries). The reason is that in Japan celebrity endorsement generates a level of trust, credibility, not to mention visibility that can be hard to match. Needless to say, building trust is a more complex task than securing the services of a celebrity to endorse your brand, but in terms of getting around consumer defenses and having them pay attention, there are few quicker ways in the short-term to do it.
Creating trust requires genuine efforts in terms of investment and strategy but there are steps that can be taken to leverage your resources. Partnering or even licensing your brand with an established “name”, allows your brand to gain trust by association. This not only mitigates the massive investments in money and time related to starting up in Japan, it can also be a most effective way of seeing the market through Japanese eyes. However, it is critical to identify the correct partner and to assess their real intentions.
Knowing that they are approaching a famously xenophobic market, foreign entrants often feel that being perceived as foreign may be a weakness. But the reality is that being seen as foreign is sometimes a weakness, and sometimes a strength. Often it comes down to your ability to re-set the your category’s agenda. This is a strategy for turning being foreign into a positive as in a sense it is sometimes much harder for a Japanese company to do so without being seen as negligent of prevailing rules and norms.
The idea is to force the market to change its existing practices to compete with you on your own terms. Failure to do so more often than not means that your product or brand will be simply ignored, even if it enjoys a brief honeymoon period. In most fields, Japan has extremely wealthy, competitive and responsive domestic players who are more than able to respond to the challenge of foreign entrants. In a culture that cries out for innovation and is served by companies that are used to meeting that need there is little point expecting anything if you can’t offer a genuinely different approach.
This column is not intended to offer a detailed analysis of Jetstar’s business prospects. However given that they intend to offer a breakthrough value proposition to consumers and seem to understand the value of using stars (people and brands) to smooth the way, you’d have to say they seem to have more than a fighting chance.
21st May 2012
CarterJMRN is a strategic market research agency that has been helping clients with consumers and businesses in Japan and beyond since 1989.
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