Beware of 'polite business'! The challenges of cracking Japan's cosmetics market

By Michelle Yeomans

- Last updated on GMT

Beware of 'polite business'! The challenges of cracking Japan's cosmetics market

Related tags Japan

Establishing or indeed sustaining business in Japan's cosmetics market depends on the seamless interaction and integration with its culture, not something every international company has managed to get right...

Japan is a mature market that has experienced deep modifications at every level, such as social mutations, prices and market structure to name a few.

Only by conducting thorough market knowledge, working closely with a local partner and having a clear strategy that combines identity, quality and innovation will cosmetic companies have the leverage to succeed.

According to Erwan Rannou at the Minerva EU-Japan Centre for Industrial Co-operation, companies should try to benefit from help and support (export credit and services), from both Japanese and EU organisations to avoid common mistakes and experimental market entry.

Rannou tells that due to information gaps and asymmetries, smaller enterprises from Europe for example, are unaware of the export credit products and services available. 

"Harmonisation of the EU and Japanese legislation regarding the importation process of cosmetics and especially regarding the quasi-drugs system is vital as it represents a major barrier for many SMEs​," he tells this publication.

Be aware of 'polite business dealings'

The researcher says simple mistakes in translation, packaging, an inappropriate commercial or not understanding the local culture can be detrimental for even the biggest of personal care players.

Take Procter & Gamble for example. Rannou points to a campaign for one of its detergents' featured a standard side-by-side product demonstration of whiter shirts and brighter socks to its competitors.

Apparently, it didn't go down well with the Japanese, who prefer "harmony and polite business dealings​".  

The international personal care player also ran into some difficulty with a television commercial for its 'Camay' soap where a man was showed walking into the bathroom while his wife bathed. Women took great offense as a husband imposing on his wife's privacy is regarded as 'bad manners' in Japan.

Japanese shoppers expect prestige and privilege

Global successful beauty retailer, Sephora also experienced difficulty when it entered Japan with 7 superstores featuring standardized 'assisted self-service' back in 1999.

Applying the 'standard' store layout was seen as depriving the Japanese consumer of the prestige and privilege that they were accustomed to and by 2002 the company had no choice but to pull out.

Ultimately, Rannou describes that venture as "failing to understand the target consumer and made various ineffective market targeting."

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