Why Japan Trails in Communicating Brand and Shareholder Value


Advancements in communications are evolving constantly. Content Marketing. Corporate Social Responsibility reporting. Virtual Reality storytelling. Businesses are growing their brands alongside their growing reputations.

But there is an issue with these trends. They are not being utilized correctly in Japan because the fundamentals of communication were not established the same here as they were globally. And I have a theory as to why.

When the Japanese economy was growing strongly in the late 80s, companies had clear goals: make good products and cash in. This was also during the boom of maximizing shareholder value. Creating the greatest profits for investors (though in 2009, Jack Welch emphasized it is not a strategy, rather a result).


 

After the bubble popped in 1992 the economy stagnated in Japan. The next ten years became known as the Lost Decade — though some even claim this recovery lasted 20 years. During this time, however, the rest of the world started noticing a change in their one-way business approach. That is, consumers started choosing to support companies that cared about their interests.

One successful case, however, is Toyota, a global leader for reputation and communication. Many Japanese companies respect them but few try to communicate like them. Of course they make great products, but they also communicate their value.

While global consumers were becoming independent, Japan’s market was trying to understand how to get back on the money train. Therefore, little progress was made in the way of marketing in Japan. There was no shift of focus because everyone was concerned about the present — and the past — too much.

“Making products has always increased trust in our brand,” they thought, “so we just need to make better products still.” This trust used to translate into profits, but globally things had changed. Trust needed to be earned through communicating real value. There was a growing importance in branding in the rest of the world. Brands began telling their story and connecting with consumers.


 

Instead of flashy advertisements, companies created identities based on shared value with their customers. No clearer case exists than with Apple’s bold campaigns telling people to “Think Different.” Even now as a top trusted and profitable company, Apple still pushes their brand and connects with its users.

This connection became even easier with the widespread adoption of the internet. Brands could talk with anyone, anywhere. But that was the key difference. Because of the diffuse nature of the internet, companies no longer talked to consumers, rather with. Conversations were born. 2-way communication thrived.

While the rest of the world was realizing technology’s capacity to connect people and champion personal expression, regaining that lost profit was still a fundamental goal in Japan. So as things reached normalcy, the goals never progressed. Here, communication is not understood the same way, therefore it is not important. But that is extremely dangerous to believe for business.

Even Shiseido CEO Masahiko Uotani believes it is “regrettable that only a handful of Japanese brands feature in Interbrand’s Best Global Brands ranking, which ties brand value to business performance [emphasis added].”

Communicating brand identity and value is vital for global success. Communication is the combination of a company’s actions and their message. It is sharing the brand’s value in a way that an audience will listen. By communicating correctly, companies grow global recognition and global trust.

Because the communication transition never occurred, not many Japanese companies have broken through globally. One successful case, however, is Toyota, a global leader for reputation and communication. Many Japanese companies respect them but few try to communicate like them.

Of course they make great products, but they also communicate their value to a receptive audience. While many companies are still focusing on profit or their Japanese roots, Toyota focused on telling their value, and it has made them the success that they are today. We can only hope that companies begin to realize their value’s global potential.

Eric D Beal II is a copywriter and brand analyst in Tokyo. You can read more from him here.

 

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