Japan gets taste for the Occident

With Japanese consumers increasingly sold on Western products, potential money-making opportunities for European and US companies seem limitless.

Bankrupt banks, a weakening Yen, management oversights that cost billions, and a problem with organised crime make the Japan of the Nineties pale into insignificance by comparison with the invincible Japan Inc of the Eighties.

But while perceptions of Japan ride a rollercoaster, the realities are more stable. The Japan of the Nineties is an easier place for foreign firms to do business and continues to be a remarkable source of product and marketing innovation.

Last year, the milk market got an unexpected boost thanks to DHA (docosahexaenoic acid), an obscure extract of fish eyes that is supposed to improve mental ability and reduce cholesterol. Mothers quickly adopted Meiji milk products enhanced with DHA to give their infants the chance to make better grades at kindergarten and primary schools.

The idea was soon adopted in Korea where the best-selling milks now contain a shot of DHA.

This year’s surprise is a doubling in size of the sleepy cocoa market. Well-publicised reports from a scientific congress last autumn spread the belief that cocoa suppressed the free radicals that hardened arteries and caused cancer. Demand for cocoa outstripped the industry’s production.

Earlier this year, the Morinaga and Meiji confectionery companies, two leading cocoa makers, ran ads apologising for their inability to make enough.

Dramatic de-creases in property and rental prices make it easier to set up shop in Japan. But there may be no need.

Sophisticated consumers are buying a growing volume of merchandise by mail from overseas. In 1994, they bought $1.8bn from the States alone, rising to $2.1bn in 1995. Among the many US companies selling in Japan are LL Bean, Eddie Bauer, Lands’ End, US Cavalry and the Paul Frederick Shirt Co.

Many US direct mailers are now producing Japanese catalogues and other initiatives, but without even opening an office in Japan.

While the Americans clean up DM opportunities, British firms are doing well by licensing famous brand names and characters.

Meiji Milk Products Co has turned McVitie’s famous digestive biscuit into a Malteser rival – its McVitie’s McViBall is a marble of biscuit dipped in chocolate.

The Morinaga Food Company offers a range of Peter Rabbit cake mixes to the Japanese palate.

And Heinz Japan has created a Winnie the Pooh Egg Soup for children. The product’s natural ingredients include eggs, organic vegetables, chicken extract, tuna, sardines, salt, and a jolt of DHA. Not a lick of honey in sight!

However, the real embellishment for Tokyo tea times is provided by Susie Cooper’s tableware designs from the Thirties. Since her death last year, her crockery prices have soared in Tokyo. A tea set for two in her popular Pink Dresden design now costs about 1,500 in Japan. Travel agents are pondering all-inclusive tours to attend Sotheby’s Susie Cooper auction this October.

For years, the Japanese have associated Europe with a quality of life that is denied them. A European touch can give new brands a cachet that captures consumers in a market overflowing with more completely Japanese products.

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