Explorations in Japanese Culture
While the Japanese population has historically been viewed as a homogenous group by outsiders, Japanese firms are notorious for segmenting the Japanese population. Japanese consumers are typically segmented into different groups and sub groups based on age, economic status and lifestyle. These broad groups will be looked at in this post and include the elderly, the single market, male consumer, the otaku consumer and lastly a look at the “new rich” consumer group. While each shares many of the broader habits of the Japanese consumers, they each have their own unique habits.
The elderly in Japan are known to be both “healthy and wealthy” (Cheron 2011). When referring to the elderly consumer group, they are called “the silver market” and are defined as being anyone over the age of 50 (Cheron 2011). The elderly are growing in size and influence in Japan as post war baby boomers are beginning to age. The elderly are expected to account for 39% of the population by 2050. While Japan is a country where the majority of the population lives in the city or surrounding suburbs, the elderly are much more concentrated in rural areas. This concentration is so high in some areas that schools have been closed down and re-opened as retirement homes (Cheron 2011).
Since they are retired, the elderly are characterized as being free of responsibility and having a large amount of disposable income.” A growing sub-group of the silver market known as a the “lifestyle aristocrat” have a desire for private space and time, a slow leisurely pace, a turn to a more health conscious lifestyle, self-cultivation and growth and an overall movement towards living for leisure rather than work (McCreery 2000). An organizational structure of the elderly in sub-segments was created by the Hakuhaido marketing research firm, and breaks the elderly down into sub segments based on health, social communication and financial wealth with the first possession of good health, good social communication and finances being known as the “happy elders” and those lacking in these areas being known as the “depressed elders” (Cheron 2011).
With the elderly being such a large market in Japan, it is important to consider their needs when targeting the segment. Cheron suggests several different trends that need to be looked at when considering the “silver market” as consumers of a product. First, since they are aging and requiring more care, attention needs to be given not only to making elderly consumers’ lives better, but also products need to help the efforts of the caretakers (Cheron 2011). Second, with their free time, many of the elderly begin to seek out ways for personal development and self-improvement. For example, “Curves Japan” (the health and fitness club) has been very successful in catering to this by opening female-only exercise centers that emphasize workouts for the elderly and also enhanced social communication (Cheron 2011). Lastly, enhanced attention is being paid to the needs of elderly travelling abroad; with more time and money the elderly are increasingly taking longer trips abroad then before in previous generations. Japanese seniors also tend to travel in larger social groups in the form of group tour packages. This trend has increased so much, that the largest travel agency in Japan, Japan Travel Bureau (JTB) actually opened a subsidiary that specializes in senior travel (Cheron 2011).
As consumers, singles are often characterized as having little responsibility and large amounts of disposable income. Because of this they are often a particularly attractive target market. In Japan with the changing societal norms and economic development, there have been a growing number of consumers who stay single longer into their life and with that have greater levels of disposable income. Single consumers are more likely to spend their money on hobbies and interests such as electronic devices or luxury goods. They have a lot of money to spend and little responsibility, so they are increasing their consumption of hobby goods. In Japan, the singles market is made up primarily of two different consumer groups, both of which are fairly new developments. The first being the “parasite single” and the second being the middle aged single.
While often un-married and single is equated with living alone, in Japan, it is becoming more common for young singles to live with their parents later and also delay taking on additional financial responsibilities. This leaves singles with the income of a full time job, but without the burden of financial responsibility. These consumers are referred to as “parasite singles,” and refers to someone of either gender who is single, employed and lives at home with their parents, but offers little or no contribution toward household expenses (Collins 2011). While in the US market there is a stigma that comes along with this lifestyle, often in humorous portrayals of older men living in the parents’ basement and pursuing their adolescent hobbies, in Japan this is becoming more common. The parasite singles may see a big drop in their levels of lifestyle comfort when they move out of their parents’ homes, but the successful ARAFO single is able to live alone and still enjoy a comfortable life full of consumption (Collins 2011).
The term ARAFO comes from an appropriation by the Japanese of the term “around 40” and refers specifically to single women around the age of 40 (Collins 2011). Women have been finding more financial freedom as they have increased participation in the workplace. With this new freedom the idea of marriage is no longer automatically considered the norm and many young women are either not marrying or delaying marriage. In fact, Japan is now one of the latest marrying populations in the world (Collins 2011). These women are particularly attractive to marketers as they spend a large portion of their disposable income on the consumption of different services in the form of what is known as “retail therapy.” Three specific areas of spending that fall under the rubric of “retail therapy” are beauty, health and home (Collins 2011). Many analysts believe that special attention needs to be paid to this group as they look to them to lead the way in the sustaining and salvaging of a stalled Japanese economy (Collins 2011).
The Salaryman is the traditional model for the Japanese male. He works hard for the company, often long hours at the office, all the while making his way up the corporate ladder as he works towards promotion and advancement. This generation was born during the Baby boom that followed WWII and grew up in crowded schools and colleges, always being encouraged to work towards eventual success (McCreery 2000). When they entered the work force they were greeted with plenty of jobs at the bottom of growing organizations, made possible by many years of economic success linked to the massive efforts to rebuild Japan after WWII. They preferred not to be too visible or adventurous, but instead opted for comfort, security and cultivation of tastes (McCreery 2000). These older generation males adhere to more traditional roles of gender, but with the growth of the new male consumer Japan is seeing men who no longer feel the need to adhere to these roles as they seek out completely different life styles and consumption habits.
While the young male consumer of Japan is by no means homogenous, they certainly are quite different from the older generation of male consumers. This new generation of Japanese males are no longer as bound to the traditional roles of masculinity and as a result are feeling less self-conscious as consumers. Young male consumers are essentially able to purchase whatever they want without feeling self conscious about whether it is the masculine thing to do, whether it be sweets, cosmetics or fruity cocktails (Toussaint 2011). There has been a big shift of the male consumer from the traditional alcohol and automobile industries to the fashion and male beauty sectors, which have both seen strong growth in recent years (Toussaint 2011). These men are finding security and happiness in the consumption of personal luxuries, more so than generations in the past. Additionally, these males are having much longer periods of time to consume based on their own preferences. While in a traditional marriage, finances and spending is handled by the woman, since these young men are also staying single longer they are beginning to control their spending and exercise habits for even longer in their life (Toussaint 2011). Japan has not had a large population of wealthy individuals for very long and is a fairly new development in Japan, but these consumers are leading in the consumption of luxury goods, which has made Japan one of the largest consumers of luxury goods in the world.
In Japan, there are very few families who have been rich for more than three generations or whose wealth was accumulated before World War II. Because of this, many refer to the wealthy in Japan, as the “new rich” because they are not coming from long established lines of wealth. Within this new class of wealth, there is segmentation
The long term rich in Japan today are those characterized by wealth that comes from grandparents and parents of today’s long term rich, who made their wealth during the boom times during the post-war growth and were able to secure these assets and pass them on through their family (Haghirian 2011). The second group is made up of those who have grown rich through many years of hard work and are characterized as being self made men or women who own their own companies. Examples of this are those who have professions such as attorneys, accountants or doctors. These are all people who have made their large fortunes through a single generation of work (Haghirian 2011). The last group is referred to as the “suddenly rich.” These are people who have become rich through a sudden event such as an inheritance, pension or through a financial event like an IPO. Wealth in Japan due greatly also to Japan’s tendency to save money in large amounts along with high savings rates offered for most of Japan’s history.
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