Japan’s Major Department Stores are Taking a Bashing.
Last year, two of Japan’s major department stores announced comprehensive strategies to get customers back through their glamorous double doors.
Most interesting to me is ‘catering to growth markets’, namely inbound tourism.
An essential element of the Japanese government’s growth initiative is to ‘bring 40 million visitors to Japan in 2020’ just in time for the Tokyo Olympic Games. And this is going well, with over 20 million visitors just last year.
So with such encouraging stats, why are these stores taking such a major bashing with over a decade of slow trade, declining sales and closures nationwide and overseas?
Anything you can do, I can do, cheaper.
There are many well documented reasons: the convenience and competitive value of online shopping like Amazon and Bic Camera, retailers with cheaper products or ‘value brands’ such as Ikea and Nitori, as well as the outlet shopping malls. There’s also Japan-specific societal issues relating to economic stagnation, rapidly declining birthrates and an aging population.
However, put (very) simply, everyday people have less money or are less inclined to visit a department store.
In my recent research into business strategies of the top department stores in Japan, I found fierce acknowledgement of the above and even fiercer initiatives to get customers in. But despite Japan inbound tourism being a major weapon in their arsenal, the following bullet was missing without ever being fired at that particular target:
• Brand engagement through online communication
Certainly, efforts are in place to build awareness of the major brands as ‘brands’ by positioning Japanese crafts and culture products such as Takashimaya Nippon Monogatari, introducing member loyalty credit cards, duty free shopping services, and renovation plans for flagship stores.
However, very little in the way of targeted (online) communication and conversation.
By this I mean drawing the audience in with engaging information, stories and interactive experience with the goal of creating brand fanatics or advocates.
But you don't have to take my word for it. Two little words of wisdom: John Lewis.
UK retailer, John Lewis, has driven a 35% increase in year-round sales through a series of Christmas commercials backed-up with deep engagement with its audience. The characters and narratives of the now popularized ‘John Lewis Christmas Adverts’ are seamlessly expanded across various media, merchandising and experiences accompanied by committed conversation and communication with audiences online.
Last year, Macy’s of New York leveraged its iconic ‘Macy’s Thanksgiving Parade’ with online interactive maps and 360 degree imagery, Twitter video streaming, multiple video releases on Youtube, and conversations over multiple digital channels & platforms.
Something Worth Talking About.
So what of our beloved department stores, how are they engaging with inbound tourists in the run up to the almighty Tokyo Olympic Games? I put my micro-team (of three including myself) to researching. After just two weeks, their stoicism was no longer ignorable and neither did they appreciate our department store field trips.
We found little (and I’m being kind) that would make me want to jump straight from Narita Airport into a taxi, skip the hotel breakfast and dash down to the historic Mitsukoshi Department Store to observe the daily ceremonial opening of the doors at 10:30am. Oh, and the darling little old Japanese ladies dressed in Kimono lined-up waiting to enter.
Which is a shame, because what we did find is enough history, cultural beauty, iconic imagery, classic and modern architecture and more to create meaningful and immersive stories to expand on and converse with both domestic and international audiences.
Now, I know the marketing planners do have themes and initiatives in place, as mentioned earlier. However, what I couldn't find was any committed communication strategy for this specific target.
Go ahead, make my day.
What the Japan’s retailers can learn from John Lewis and the like is an understanding of what the audience wants and how to deliver this in a way that is tangible and appealing. Easier said than done, perhaps?
I took my research and my enthusiasm on the topic to a Japanese friend who is an accountant for a well-known European cookware company. I explained. She understood. And she replied looking me directly in the eyes, “onegaishimasu” which in English means something like ‘If you would be so kind’.
What I understood from this was “Chioma, this is important, we are all suffering. 22 of our 30 outlets are inside these department stores, and we may have to considerer exiting and opening up more stand-alone stores, which we really don’t want to do…”
Dear Mr Department Store, if you are having trouble reaching the receiver, please try again or contact someone who can help you.