Sales of imported luxury brands in Japan are increasing for the first time since the country plunged into recession in 1990. Last year, sales of Chanel soared 18% to Yen 31,800 million while those of Louis Vuiton were up 17% at Yen 51,400 million. But it is not just business as before, according to Dentsu analyst Ieo Iwasaki. "Attitudes have changed," Iwasaki says, "During Japan's first luxury brand boom from the early 70's to mid 80's all famous 'luxury' brands were discovered by the Japanese. People bought them more or less indiscriminately, but Louis Vuiton, Hermes, and Dunhill were three that did especially well. Later, during the second brand boom that coincided with Japan's economic bubble from the mid 80's to 1990, consumers tried to differentiate their tastes from each other. They were not looking so much to buy the same brands, the same products as everyone else. Instead, looked to brands to help make a clear statement about their own identities. But things are a little different today. Consumers are more confidant, more experienced, and choose brands they feel fit in with their own life styles, that they feel comfortable with."

Studies by the INFOPLAN market research firm in Tokyo suggest also that competition among luxury brands is likely to increase in Japan. "The Japanese market will increasingly become a battleground for local brands, European brands, and those from the USA. Japanese consumers have strong images of other countries, their people, and the products they are making. For example, with regard to product quality and trustworthiness, for the Japanese consumer, Japan has the lock on production quality. Women are more positive towards French products than men. America is strongly associated both with originality and unique products," explains INFOPLAN managing director Chris Beaumont. " Among Japanese consumers, Western European brands are the most highly regarded for their design qualities; France in particular excels, followed by Italy, and then the other European countries. The image of many brands today is a natural reflection of their nationality and parentage, but both of these are aspects which are going to be much more consciously managed or manipulated in advertising, " says Beaumont.

McCann Erickson have built up one of the widest portfolio's of experience in advertising luxury brands in Japan. Their roster includes both famous European brands from LVMH and also US brands such as Tiffany, and Cadillac both of whom are building 'luxury image' franchises in Japan.

"There's a particular problem to be faced in advertising luxury brands in Japan," says McCann's creative director, Mr. Shiniichi Enzaki. "For the most part, Japanese advertising works by building empathy the consumer. To gain empathy, Japanese advertising tends to be very friendly. But too much friendliness is not always consonant with the images of luxury brands. Thus part of the creative challenge is to add the right emotional values, to create empathy, without turning the brands into everyday consumer products."


The rise of brands like Tiffany, Parker Pen, and Cadillac all handled by McCann Erickson are examples of this approach. "TV plays an important part in our creative strategy for Tiffany," says Enzaki. "To give the brand the right emotional qualities, we use music." Tiffany commercials use "Moon River," from Breakfast at Tiffany's (a widely known and much liked classic film in Japan) together with beautiful product shots to woo consumers. Advertisements for Parker Pens, also by McCann, show immaculate detailed photographs of beautiful writing instruments together with the signatures of famous Japanese writers. The signatures are magnified so that every detail of the way the ink flows over, and is absorbed by the writing paper is evident. Cadillac advertising links the car with the lifestyle of well known Japanese professional golfers, of about the same age as potential purchasers.

For Moet et Chandon champagne the challenges are more complex. Though widely known, champagne is not widely drunk in Japan outside of weddings and other celebratory events. McCann print ads create images that are both very festive and very French out of a collage of bottles. But rather than showing pictures of people drinking, the ads create architectural images of fountains with plumes of champagne exploding skywards.

Product strategy is as important as advertising for luxury brands to develop a franchise. Too few, and too expensive products can create a valuable niche but miss out on the opportunities Japan offers. Too many inexpensive products and a brand can lose its luxury cachet, witness Pierre Cardin. For the time being at least, Chanel have created a product range that enables men and women of all incomes and age groups to add a Chanel touch to their lives. At the high end, their are perfumes, expensive accessories and apparel. At the low end, T-shirts and key rings. Advertising of course focuses on the image values that the more expensive products possess but which may be unaffordable to most.

The current brand boom has swept up Tokyo's teenage school girls who are rapidly acquiring a taste for famous brands. But in doing so, it has created a new social problem. The brand boom has been accompanied by a rash of newspaper stories about Tokyo schoolgirls financing their brand habits through sex on the way home from school. A brief liaison can earn Yen 100,000 compared with about Yen 2,000 per hour working in a fast food restaurant. In Tokyo, where consenting sex with a minor is not a crime, the metropolitan government is debating whether to make it illegal while social commentators criticize the values of a society where such a problem can arise.

Gucci 14%
Chanel 11%
Ralph Lauren 10%
Louis Vuiton 14%
Prada 11%
Ferragamo 10%
Cartier 4%
Hermes 9%
Agnes B 6%
YSL 3%
Max Mara 3%
Margaret Howell 3%
TOTAL 100%
Source: Yano Keizai