Accelerating DX in Japan: How iPaaS Empowers Foreign Vendors to Thrive in the Local Market

Rising Demand for Digital Solutions in Japan

A survey by the Ministry of Economy, Trade, and Industry in Japan revealed that more than 60% of Japanese companies are concerned about their digital transformation (DX) lag. This highlights a significant demand for solutions that can address this challenge, and iPaaS (Integration Platform as a Service) is poised to become a powerful tool for Japanese enterprises to drive cloud migration and business process optimisation. This presents a substantial business opportunity for foreign vendors. Here are six reasons why iPaaS can succeed in the Japanese market.

1. Tailwinds for Digitalisation

Japan's delay in digital transformation has been widely acknowledged. According to the World Digital Competitiveness Ranking 2023 (IMD), Japan ranked 32nd out of 64 countries regarding digital competitiveness. iPaaS can bridge the gap and become an ideal solution for Japanese companies.

2. Addressing Labor Shortages

Japan faces severe labour shortages due to a declining working-age population, an ageing society, and low birth rates. The job-opening-to-applicant ratio stood at a high of 1.29 in 2023 (Ministry of Health, Labor, and Welfare), underscoring the urgency for productivity improvements. Business process automation through iPaaS can be a viable solution to this challenge.

3. Overcoming Legacy System Challenges

While the cloud adoption rate among Japanese companies remains low at 22% (2021), there is an increasing willingness to invest in cloud technologies (Gartner). By integrating systems through iPaaS, businesses can streamline operations and reallocate resources towards innovation. Many Japanese companies still rely on outdated legacy systems, making integration and migration essential.

4. Accelerating Global Expansion

Japanese companies with multiple overseas locations require seamless system integration across borders. iPaaS enables such global connectivity. Despite Japan's lagging digital competitiveness, over 25,000 Japanese companies have overseas subsidiaries (Ministry of Economy, Trade, and Industry), highlighting the need for information sharing and collaboration within global supply chains. Data integration through iPaaS enables real-time, informed decision-making and enhances competitiveness.

5. Synergies with Advanced Technologies

Japan has increasingly adopted automation technologies such as RPA and AI. When combined with iPaaS, these technologies can deliver even more significant benefits to business process automation.

6. Facilitating Remote Work

While the COVID-19 pandemic prompted many companies to adopt remote work, only some have been able to implement it fully. By leveraging iPaaS to build hybrid environments, businesses can enable flexible and secure remote access while enhancing operational efficiency.

As evident, the Japanese market presents compelling business opportunities that iPaaS vendors must pay attention to. Vendors with strengths in problem recognition and solution delivery are well-positioned to impact Japan significantly.

Content Marketing for iPaaS Companies in Japan

Localised content marketing strategies are critical for foreign iPaaS companies to succeed in Japan, even beyond the merits of their products and services. Japanese corporate culture and business practices have unique characteristics, and a one-size-fits-all approach may resonate poorly, no matter how compelling the technology or value proposition.

What is required is a strategic and thorough localisation of content marketing, informed by a deep understanding of both the product's technical aspects and the nuances of the Japanese market. Key considerations include:

1. Partner with Local Agencies Knowledgeable in Product Technology

High-tech products like iPaaS often involve extensive technical terminologies, making simple language translation inadequate for practical content explanations. Collaborating with local marketing agencies that not only grasp the technical aspects of the product but can also provide clear explanations in Japanese is crucial.

Translating industry jargon and technical concepts into engaging narratives tailored to the target audience is essential. This breaks down complex ideas into easily understandable terms. Additionally, content creation should reflect an in-depth understanding of Japanese corporate culture and market characteristics.

2. Understand the Differences in Customer Journeys

In the Japanese market, people prefer downloading resources over requesting demos, necessitating adjustments to the marketing process design. Regional differences in social media usage patterns and interest in offline events should also be considered.

Close collaboration with local marketers is essential to gain insights into the behavioural characteristics of Japanese users and develop content marketing strategies that effectively drive inquiries.

3. Share Success Stories

Sharing concrete examples of how the product has been successfully utilised by other customers, both domestic and international, can help build trust and credibility. Illustrating how customers have leveraged iPaaS and its realised benefits can enhance understanding and interest among potential Japanese customers, ultimately encouraging adoption.

4. Leverage Effective Online Advertising

Employing online advertising to reach potential customers is crucial, especially during the initial market entry phase. Combining major Japanese platforms such as Google Ads and Yahoo! Promotion Ads is recommended to collect audience data within the first few months, optimising subsequent advertising strategies.

Gaining traction in the Japanese market will only be possible with such meticulous localisation efforts. A dedicated and nuanced local marketing approach is the key to establishing a foothold for foreign digital companies in Japan.

Expectations for Foreign Companies to Support DX in Japan

As highlighted by the Japanese government's establishment of a Digital Agency and other DX initiatives, addressing the nation's digital transformation lag is a significant priority. There is a growing demand for the latest insights and practical know-how from leading foreign digital companies. To overcome Japan's digital challenges, foreign digital companies are expected to support product implementation, proactively engage with Japanese enterprises, and provide practical DX solutions.

TAMLO has extensive experience in supporting content marketing for iPaaS companies. Feel free to inquire for more information.