A Guide for Marketing Leaders in APAC to Succeed in the Japanese Market

Barriers Japanese Market Representatives in Singapore, Australia, and Hong Kong Face

As the world's fourth-largest economy, Japan offers lucrative opportunities for global expansion. However, its distinctive cultural, business practices and regulatory landscape pose unique challenges. The limited use of English further complicates navigating this complex market.

Consequently, many global businesses have started exploring the Japanese market's potential from English-speaking Asian bases such as Singapore, Australia, and Hong Kong. Jumping straight into full-fledged entry is risky; it is wise to gradually expand after gaining a firm grasp of the local conditions.

This blog introduces various challenges that marketing leaders in APAC face when eyeing the Japanese market and provides practical solutions to overcome these barriers.

1. Language Differences

In Japan, English is limitedly used in business settings, making Japanese the primary language for communication. Unlike in many English-speaking parts of APAC, mastering Japanese or having strong localisation partners is essential. Additionally, understanding and respecting business etiquette and cultural nuances are critical.

The language barrier is surprisingly high, and its complexity becomes apparent in localising websites or white papers. While global companies commonly translate English content into various languages through translation companies or automatic tools, Japanese requires more due to its complex language system comprising kanji, hiragana, and katakana. The meanings and readings of these characters change with context, and handling them requires nuanced understanding.

For instance, the same kanji can convey a formal, business-like tone in documents, while hiragana and katakana can make expressions softer and more accessible. Automatic translation fails to replicate these nuances accurately. Additionally, etiquette in language use, such as different forms of politeness, is crucial. Professional translators or localisation companies' manual work is indispensable for appropriately conveying cultural and subtle meanings.

The barrier to language and communication in Japan is higher and more pressing than one might imagine, making overcoming it the first step into the Japanese market.

2. Communication with Japanese Sales and Development Teams

When managing marketing activities for the Japanese market from regions like Singapore, Australia, and Hong Kong, communication with the Japanese team can pose a significant challenge. Marketing personnel in the APAC region often need help aligning instructions from headquarters with the desires of the local Japanese sales team. They also need help explaining local marketing strategies deeply rooted in local circumstances to headquarters.

Local sales personnel who need more time or need to be more familiar with detailed explanations of market characteristics and cultural backgrounds exist. However, bridging this cultural and market gap is directly linked to success in the local market. With few English speakers in Japan and a high psychological barrier to foreign brands, deep understanding and empathy for the local context are indispensable.

To address this, we employ two approaches. First, we conduct meetings involving all stakeholders, including personnel from the home country, APAC leaders, and the local Japanese team, to deepen understanding of the culture and market. Here, we aim for a common understanding by explaining the uniqueness of the Japanese market in detail. Next, we compile insights gained locally into English reports for submission to the headquarters. We share information in English through data-based analysis, allowing everyone to understand the project's status. These efforts help overcome cultural and market differences, facilitating effective communication between the headquarters and local teams.

3. Channel Strategy Specific to the Japanese Market

As mentioned at the beginning, Japan is an attractive market due to its high potential for global expansion. However, it also has unique characteristics that differ from those of other countries. Therefore, detailed strategies tailored to the Japanese context are necessary rather than general marketing methods.

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Firstly, conducting comprehensive market analysis, consumer research, and social listening is crucial for profoundly understanding the Japanese market. Accurately identifying the target audience and formulating promotion strategies from the insights gained are essential. Optimising keyword selection and product positioning for the Japanese market enables effective marketing.

Additionally, selecting marketing channels appropriate for the Japanese market is necessary. While Google is overwhelmingly popular for search engine use, Yahoo! JAPAN also holds about a 15% share, which cannot be ignored. When allocating a budget for search ads, making careful decisions based on such market realities is vital.

In BtoB, domestic SNS platforms are more mainstream than LinkedIn, with Facebook, Twitter, and the blogging platform note being widely used. Meanwhile, BtoC focuses on mobile-oriented social media platforms like Instagram and LINE, which are becoming crucial channels for reaching the younger demographic. Due to the differing channel characteristics in each field, thorough analysis and tailored use according to the Japanese market are essential.

When we formulate marketing strategies for our clients, we conduct 2-3 hour workshops to discuss their objectives, strengths, and competitive environments. In these sessions, we lay the foundation for our strategy, set KPIs, and clarify specific actions and their priorities. Through these diligent efforts, we can craft marketing strategies that fit the Japanese market's unique characteristics.

4. Method of Informing Consumers

A critical aspect to emphasise when building a marketing strategy for the Japanese market is the method of providing information. In Japan, the abundance of information in advertisements and websites stands out as a distinct feature. This is rooted in Japanese consumers' need for detailed product or service information before purchasing, a cultural risk-avoidance measure. Providing sufficient information reduces consumer anxiety and enhances trust in products or services.

Therefore, when creating marketing materials or advertisements for the Japanese market, it's essential to understand the importance of information provision and pay particular attention to its quantity and quality. Japanese consumers desire extensive information about products or services, and the comprehensiveness of the information provided significantly influences their purchasing decisions. Finding the right balance in information provision is critical to devising an effective marketing strategy in Japan.

Furthermore, preferred methods of conveying information to Japanese consumers include using characters or comics in videos and white papers. These methods allow information to be communicated in a fun and friendly, proving effective in the Japanese market. Such visual and storytelling-focused communication methods enhance understanding and make the information more memorable.

5. Unique Business Practices in Japan

The business environment in Japan is distinct from that of other APAC countries, including long-term negotiation processes, frequent face-to-face meetings, and detailed contract negotiations. Moreover, building networks, learning the etiquette of exchanging business cards, and fostering relationships through social gatherings are essential to adapting to unique Japanese business customs. Understanding and adapting to Japanese business culture is critical to success in the local market.

This difference in business customs also significantly impacts content marketing practices. Methods commonly effective overseas, such as "requesting a demo," may not work well in Japan. Japanese personnel prefer thoroughly reviewing white papers and service overviews before experiencing a demo or contacting sales. Thus, providing localised, detailed informational materials from the early stages of marketing is necessary.

Adjusting the content approach to suit the Japanese market is essential, as merely calling for "demo requests" is insufficient. Preparing landing pages and thoroughly localising white papers and service overviews for the Japanese market will meet prospective customers' interests and needs.

6. Legal Regulations and Compliance

Adhering to complex and strict legal regulations is crucial to business in Japan. Thus, seeking appropriate advice from experts familiar with local laws and consulting with agencies is necessary. Regular discussions with specialised consultants are advisable to ensure company activities comply with Japanese laws. Joining industry associations also helps keep abreast of new legislative changes and regulations.

In marketing initiatives, it's essential to thoroughly understand advertising regulations, such as the Act against Unjustifiable Premiums and Misleading Representations. In addition to general sweepstakes advertising regulations, stealth marketing regulations, including influencer marketing, which have been strengthened recently, also need attention. Additionally, depending on the industry, specialised legal knowledge may be required to comply with the Pharmaceuticals and Medical Devices Law in the pharmaceutical and cosmetics sectors.

Moreover, appropriate responses to systems demonstrating corporate social responsibility, such as acquiring the Privacy Mark and addressing CSR and sustainability, are indispensable. However, awareness of sustainability in Japan is relatively lower compared to Western countries. Thus, nurturing the Japanese market and enlightening your Japanese team on these issues should proceed simultaneously. Compliance with governance codes and regulations goes beyond mere obligation, significantly affecting customer trust and enhancing the corporate brand.

Understanding Japan's cultural and business intricacies is just the beginning of thriving there. Implement these strategies and consider engaging with local experts to navigate this complex market effectively. By doing so, APAC-based companies can build a sustainable and prosperous presence in Japan.