Reference no: EM132169348

Japan-Test Market for the World

The following mini case represents an example of the unique marketing attributes of a foreign culture. Here the focus is on the idiosyncrasies of the Japanese market and how they can be used to establish a pilot or ''test'' market for the rest of the world. In this particular activity, the focus is on establishing a test market, one that can be used to test the various features of a product and the receptivity of them within and outside the market. To some extent it is market research using primary data and secondary data adapted to a particular culture.

This chapter focuses on international marketing research. It focuses specifically on the function of providing management with information for more accurate decision making. International marketing research differs from domestic marketing research in that customer attitudes about providing information to a researcher are culturally conditioned. Foreign market surveys must be carefully designed to elicit the desired data and at the same time not offend the respondent's sense of privacy. International marketing research must also contend with inadequate or unreliable bases of secondary information. There are three keys to successful international marketing research: 1) the inclusion of natives of the foreign culture on research teams; 2) the use of multiple methods and triangulation; 3) the inclusion of decision makers, even top executives, who must on occasion talk directly to or directly observe customers in foreign markets.

Read the case below and answer the questions that follow.

Global Perspective

JAPAN—TEST MARKET FOR THE WORLD

It was 10:51 p.m. in Tokyo, and suddenly Google was hit with a two-minute spike in searches from Japanese mobile phones. "We were wondering: Was it spam? Was it a system error?" says Ken Tokusei, Google's mobile chief in Japan. A quick call to carrier KDDI revealed that it was neither. Instead, millions of cell phone users had pulled up Google's search box after a broadcaster offered free ringtone downloads of the theme song from The Man Who Couldn't Marry, a popular TV show, but had only briefly flashed the Web address where the tune was available.

The surge in traffic came as a big surprise to Tokusei and his team. They had assumed that a person's location was the key element of most mobile Internet searches, figuring that users were primarily interested in maps of the part of town they happened to be in, timetables for the train home, or the address of the closest yakitori restaurant. The data from KDDI indicated that many Japanese were just as likely to use Google's mobile searches from the couch as from a Ginza street corner.

Japan's cell phone-toting masses, it seems, have a lot to teach the Internet giant. The country has become a vast lab for Google as it tries to refine mobile search technology. That's because Japan's 100 million cell phone users represent the most diverse—and discriminating—pool of mobile subscribers on the planet. Although Google also does plenty of testing elsewhere, the Japanese are often more critical because they are as likely to tap into the Internet with a high-tech phone as a PC and can do so at speeds rivaling fixed-line broadband. And because Japanese carriers have offered such services for years, plenty of websites are formatted for cell phones.

Tokyo's armies of fashion-obsessed shopaholics have long made the city figure prominently on the map of Western designers. Sure, the suit and tie remain the uniform of the salaryman, but for originality, nothing rivals Tokyo teenyboppers, who cycle in and out of fads faster than a schoolgirl can change out of her uniform and into Goth-Loli gear. (Think Little Bo Peep meets Sid Vicious.) For American and European brands, these young people are a wellspring of ideas that can be recycled for consumers back home.

But now, instead of just exporting Tokyo cool, some savvy foreign companies are starting to use Japan as a testing ground for new concepts. They're offering products in Japan before they roll them out globally, and more Western retailers are opening new outlets in Tokyo to keep an eye on trends. Ohio-based Abercrombie & Fitch and Sweden's H&M (Hennes & Mauritz) set up shop in Tokyo, and Spain's Zara is expected to double its store count to 50 over the next 3 years. "Twenty-five or 30 years ago, major brands tested their new products in New York," says Mitsuru Sakuraba, who spent 20 years at French fashion house Charles Jourdan. "Now Japan has established a presence as a pilot market."

Some Western companies also have signed on with local partners who can better read the Japanese market. Gola, an English brand of athletic shoes and apparel, has teamed up with EuroPacific (Japan) Ltd., a Tokyo-based retailer of fashion footwear. EuroPacific tweaks Gola's designs for the Japanese market and, a few years ago, came up with the idea of pitching shin-high boxing boots to women. They were a hit with Japanese teens and twenty-somethings, prompting Gola to try offering them in other markets. "They've sold a hell of a lot in Europe," says EuroPacific Director Steve Sneddon.

Sources: Hiroko Tashiro, "Testing What's Hot in the Cradle of Cool," BusinessWeek, May 7, 2007, p. 46; Kenji Hall, "Japan: Google's Real-Life Lab," BusinessWeek, February 25, 2008, pp. 55-57; "Three Windows on Japan," Japan External Trade Organization, 2012, online; World Bank, World Development Indicators, 2015.

Tokyo is becoming a test market for many products and companies such as Google. Why is this so?

Multiple Choice

Google has failed to do adequate testing and research.

The Japanese are much less critical and are first adopters.

Google did not recognize the value of the Japanese consumer.

The Japanese are a high context culture that works better with text messages.

The Japanese are much more critical, and Internet services have been used for many years.