What Counts Most for Japanese Shoppers in the Recession?

In the midst of the global downturn, with consumers continuing to face job losses and rising prices, what counts most for Japanese shoppers? Price and quality have always been the main drivers for the Japanese and remain top priority; however, the former is bound to win out as 41% made saving money their top priority when it came to intentions.

These top-line results come from the new Strategy Briefing on Consumer Buying Behaviour in the Recession which analyses the results of Euromonitor’s 2011 Annual Study and examines the implications of these findings for marketers. This report provides unique strategic insight from Euromonitor’s most experienced industry analysts into the why behind behaviour and how we anticipate this will impact on future market trends.

Euromonitor International’s Annual Study surveyed 16,000 consumers of all ages (15-65+) in 8 mature and developing markets in July and August 2011, questioning respondents on the following themes: health and wellness, food and drink, technology, shopping and leisure, personal traits and values. For more information on Euromonitor’s survey findings, please see the Survey page on Passport.

Key findings

  • In the face of long-term economic stagnation, “price” was deemed of utmost importance for as many as 90% of Japanese respondents.
  • This applied largely across the board, with men, women and all age groups highly concerned with getting the best value for money.
  • 90% of respondents also considered “quality” to be important or very important, and this increased with age, ranging from 82% of those aged 15-29 to 94% for those aged 60+.
  • Only 38% of Japanese respondents placed high importance on peer recommendations and reviews; the lowest level among all the countries reviewed.
  • Recommendations by family and friends were found to be more important to women (43%) than to men (33%).
  • A strong brand name was considered to be important or very important to only 28% of Japanese respondents, which was the second lowest level after Germany.
  • Strong brands were more important to younger Japanese consumers (33% of those aged 15-29).

Japanese are used to thrift

Japanese consumers have become increasingly thrifty as a result of country’s long-term economic stagnation. Japan was among the first of the major developed markets to officially go into recession in 2008, and as such, consumers were more accustomed to economising than in some other countries where recession came swiftly. The onset of the global crisis saw many workers laid off, especially in the auto industry, with widespread unemployment and general job insecurity affecting consumer confidence.

Quality has always been of paramount importance to Japanese shoppers, but has become even more so following the earthquake and tsunami of March 2011 and ensuing nuclear accident at the Fukushima Dai-ichi plant. Indeed, in July 2011 Japanese agricultural officials revealed that meat from more than 500 cattle that were likely to have been contaminated with radioactive caesium had made its way into supermarkets and restaurants across the country; while radioactivity has also been detected in a range of other food products, including spinach, tea, milk and fish. This reportedly led some to even take Geiger counters to grocery stores when they shop.

Japan: “How important are the following factors/descriptors to you when considering purchasing a product or service?” (By Gender)

% respondents ticking important or very important

Source: Euromonitor International Annual Study 2011

Japan: “How important are the following factors/descriptors to you when considering purchasing a product or service?” (By age group) % respondents replying important or very important

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Changes in buying behaviour over time

Key findings

  • Despite the cautiousness displayed in other areas, only 19% of Japanese respondents said they had saved more money over the previous 12 months; the lowest share among the countries surveyed.
  • A much higher share (41%) said they intended to save more money in the next 12 months, perhaps in response to the earthquake/tsunami and nuclear disasters that struck the country earlier in 2011.
  • The share of those that had increased “saving money” was highest among those aged 15-29 (28%) and lowest among those aged 60+ (11%).
  • Similarly, with regard to work status, 29% of students had increased “saving money”, compared with just 13% of retirees.
  • Only 6% of Japanese respondents had increased their spending on new technology and 8% had spent more on clothing and footwear; among the lowest levels in the survey.
  • Despite this, only 13% of respondents had stepped up visits to discount stores over the previous 12 months.
  • Furthermore, only 9% of respondents had increased their purchase of private label products. The share was higher among those working full-time (17%), who are most likely to be providing for a family and looking to reduce food costs.
  • A far higher than average proportion of young people aged 15-29 had boosted their spending on clothing and footwear, at 18%.
  • For most Japanese consumers, the use of credit cards remained the same and was expected to do so for the foreseeable future.
  • Only 7% of respondents reported that their “use of credit cards to manage shortfalls” had increased, and only 2% expected this to increase over the next 12 months.
  • Younger respondents aged 15-29, and self-employed respondents, were most likely to have increased the use of credit cards.

Japan: “In the past 12 months have you changed any of the following habits?”/“In the next 12 months do you intend to change any of the following habits?”

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