Japan Luxury

Understanding New Trends and Opportunities in Japan’s Luxury Industry

Japan is the second-largest luxury market in the world – behind the United States and ahead of mainland China – with 3.6 trillion yen (about US$33 billion) spent each year in luxury goods.

  • Luxury labels, built on exclusivity, used to mean that having an online presence was not necessary; not the case anymore
  • digital channels must used by companies to get leverage in the market (search engines, social media, email, websites and mobile apps etc.)

Japan’s luxury industry:

  • GFC then disasters in Tōhoku and Fukushima, luxury spending in Japan shrank by over 1 trillion yen ($10.6 billion) by 2012
  • report by McKinsey & Company: Japanese luxury market… to maintain positive growth
  • 82% of luxury executives surveyed responded that their sales outlook for 2017 is significantly better than 2016.
  • by 2020, it is anticipated that the market will grow by a moderate rate of 3% to 4% per year
  • Japanese department stores are still the main venue of purchase for Japanese luxury consumers
  • 70% of people polled buy in Department store representing 50% overall revenue
  • Younger generation is buying brands like Céline, Balenciaga, and Gucci
  • Older generation are purchasing from brands like Hermès and Chanel, which are perceived as “very reliable” and “have a heritage.”

Digital marketing in the luxury industry:

  • a renewed interest in Japan in the past year or so due to recent market growth
  • Japan accounts for 11% of global luxury spending
  • Luxe Digital recently published a report suggesting that digital influences at least 80% of all luxury sales

Digital marketing techniques that are currently trending in the luxury industry:

  • Content is King
    • Storytelling, being able to tell the story behind the brand, explaining the values that define it: Luxury goods as much about image, style, and intangibles than about the actual quality of the product
    • Create contents that are aspirational and appeal to the customer’s desire to display their status
    • A luxury brand gives their customers an opportunity to showcase a lifestyle and a value system
  • Successful digital marketing campaigns
    • Burberry: social media campaigns and creative videos that combine history, fashion, and the appeal of a glamorous lifestyle. YouTube – 99 million viewers, 317,000 subscribers. Recent ad received 12 million views within a month (holiday campaign tribute for the movie Billy Elliot – Celebrating 15 years of Billy Elliot).
  • Social Media Marketing
    • Visual social networks like Pinterest provide a huge opportunity for luxury brands
    • Photographs are one of the best media for marketing luxury products
    • Chanel: one of the most ‘pinned’ brands on Pinterest – over 1,244 pins of Chanel products pinned per day
  • Boost SEO
    • A well-executed SEO strategy is one of the most lucrative digital marketing investments that a luxury company can do.
    • Google is one of the most significant channels for luxury
    • A large proportion of luxury brands have begun investing in SEO strategies
    • Tiffany: bought into SEO, have firm, successful strategies which have led to them dominating the search results

Importing Luxury Goods In Japan? We got you!

Having local help onboard is essential in order to be successful in Japan Market Entry. Don’t know where to start? We can help!

COVUE is a trustworthy Japanese company that has import licenses for many product categories. Let COVUE’s regulatory experts help you to speed up the market entry process so can that you can focus on your business. We’re here to help! It’s what we do best!

How to Start Selling Your Consumer Product in Japan through ECommerce

Are you planning on selling your consumer product online in Japan? Do you know exactly what is necessary for a successful B2C e-commerce strategy in the Japanese market? Although there are some hurdles that overseas retailers need to overcome in order to trade in Japan, the obstacles are greatly diminished when selling online or on Japanese eCommerce marketplaces. Here we will introduce the easiest and fastest ways for you to start selling in Japan.

Top 3 easiest ways to sell your product in Japan

D2C via your eCommerce website:

This is probably the easiest way to start selling in Japan without having to set anything up in Japan physically. If you are already selling online via your website, you can easily create a localized version in Japanese. We do, however, recommend that you properly localize your entire website into native Japanese as English literacy is below 10% in Japan. Without a Japanese website, it will be difficult to win the trust of Japanese online shoppers and, as a result, your conversions will be low. In addition, as a newcomer to the Japanese marketplace, you will need to run brand awareness campaigns and promotions across all digital channels, utilizing search engine marketing and social media. Selling direct to customers on your own website will require some investment into online advertising, but you won’t have to open an office in Japan or hire anyone locally. 

B2C via eCommerce marketplaces:

If you’re an unknown brand in Japan, then utilizing one of Japan’s popular marketplaces would be a great way to get your foot in the door. The top marketplaces (or “EC Malls”) include Amazon Japan, Rakuten and Yahoo! Shopping, and what is great about these platforms is that millions of Japanese online shoppers are already using them. Japan’s most popular marketplace, Rakuten offers support to overseas sellers in English.  You can also leverage your visibility with marketplace PPC advertising. Furthermore, should you choose to sell on Amazon Japan, they offer Fulfillment By Amazon (FBA) in Japan, which means logistics is taken care of by Amazon. Moreover, if you use their Multi-Channel Fulfillment (MCF) service, they can fulfil orders that come from other channels – like Rakuten. 

Distributor partnerships and third-party agencies:

Traditionally, it has only been possible to successfully enter the Japanese market via multiple layers of intermediaries. Although the landscape has changed dramatically with eCommerce as mentioned above, distributor channels can prove successful depending on your desired distribution channels. Local distributors and agencies will have the market expertise and existing relationships you need to start selling in Japan. Organizations such as the Department for International Trade and Export to Japan can help you with such partnerships. As for selling on Japan-exclusive marketplaces such as PayPal Mall, we at DFMA have a new solution for overseas sellers interested in selling on the platform.

Enter Japanese Market with No Worries!

Having local help on board is essential in order to be successful in Japan Market Entry. Don’t know where to start? We can help!

COVUE is a trustworthy Japanese company that has import licenses for many product categories. Let COVUE’s regulatory experts help you to speed up the market entry process so can that you can focus on your business. We’re here to help! It’s what we do best!

Who are the biggest foreign companies in Japan?

The biggest foreign company in Japan is Toyo Keizai as of 2018.

Naganasu has not included minority foreign owned companies such as Nissan, who were top of the rankings last time. This means Accenture (headquartered in Ireland) has shot to the top, with a 70% increase in employee numbers from 7,600 in 2018 to 13,000 in 2020. 

Gibraltar Life Insurance,  a Japan only brand, formerly known as Kyoei, acquired by US company Prudential Holdings in 2001 is still at #2 with 12,731 employees.

Naganasu has also not included Sharp, 65% owned by Taiwanese Hon Hai, which was at #3 before.

The largest European-owned Japanese company is Bosch, at #6 with 5,333 employees.  VSN (a staffing company acquired by Swiss company Adecco in 2012) has risen to #10 from #31 with 4, 271 employees, a third larger than in 2018. IKEA has also grown in Japan, from 2,700 employees at #36 to #16.

As in 2018, there is a lack of British owned companies in the top 50.  The only one included by Naganasu is AstraZeneca at #19 with 3,000 employees. What happened to GSK, which was at #28 with 3,300 employees in 2018 is not clear. Perhaps they have shrunk to below 2,000 employees, so were not in the top 50. Alternatively, as we’ve often noticed with Toyo Keizai, if you don’t respond to their questionnaires, you don’t get included.

Other European companies in the 2020 top 50 are Adecco, L’Oreal, Bayer, Nestle, Philips, Valeo (French automotive supplier), Triumph (Swiss underwear company) and Autoliv (Swedish automotive company).

Market Entry in Japan

Having local help on board is essential in order to be successful in Japan Market Entry. Don’t know where to start? We can help!

COVUE is a trustworthy Japanese company that has import licenses for many product categories. Let COVUE’s regulatory experts help you to speed up the market entry process so can that you can focus on your business. We’re here to help! It’s what we do best!

Japan looks to ease virus state of emergency ahead of Olympics

Japan expects to ease a coronavirus state of emergency in Tokyo and most areas this weekend. New daily cases are falling just as the country begins making final preparations for the Olympics starting in just over a month.

Back in late March, Japan was struggling to slow down a wave of infections. New daily cases were soaring above 7000 at one point and seriously ill patients were filling up the hospitals in Tokyo, Osaka and other metropolitan areas.

Daily cases have since subsided significantly and Prime Minister Yoshihide Suga is expected to downgrade the state of emergency when it expires on Sunday to a less-stringent quasi-emergency for several weeks.

Despite concerns raised by medical experts and the public over the potential risks of holding the Olympics, Suga has said he is determined to hold a “safe and secure” games starting July 23.

Holding the Olympics before elections in the autumn is also a political gamble for Suga, whose support ratings have tumbled due to public dissatisfaction over his virus measures, a vaccination drive criticized as being too slow, and lack of a clear explanation of how he will ensure the virus doesn’t spread during the Olympics.

Government-appointed experts met Wednesday to analyze the situation ahead of Suga’s decision on the emergency measures and expressed concern about the potential for infections to climb again after measures are eased. Suga is expected to make a final decision Thursday after more meetings.

Suga placed Tokyo, Osaka and two other areas under a state of emergency in late April and has since expanded the area to 10 prefectures and extended the measures twice. Japan does not enforce hard lockdowns and the state of emergency allows prefectural leaders to order closures or shorter hours for non-essential business in return for compensation to those who comply and fines for violators. Stay-at-home and other measures for the general population are only requests and are increasingly ignored.

Ryuji Wakita, the director-general of the National Institute of Infectious Diseases who heads a government COVID-19 advisory board, said infections have decreased in many areas, but the slowing has bottomed out in the Tokyo region. He warned that infections could increase after an easing of the measures. He said signs of a rebound are already seen among younger people.

Even as more people are vaccinated and most of the country’s 36 million senior citizens are expected to be fully inoculated by the end of July, younger people are largely unvaccinated and infections among them could quickly burden hospitals, Wakita said.

“In order to prevent another upsurge, it is crucial to prevent the people from roaming around during the Olympics and summer vacation,” he said. Experts say it is crucial to accelerate the vaccine rollout.

SoftBank-backed food delivery firm enters Japan!

A U.S. food delivery firm, DoorDash Inc, which is backed by SoftBank Group Corp announced Wednesday the launch of services in Japan. They are joining an increasingly crowded market that has grown during the COVID-19 pandemic.

Services will be available to the city Sendai in Miyagi prefecture. The delivery firm told the reporters that they plan on expanding to Canada and Australia as well.

“Our strategy has always been to empower local economies, especially in the suburban markets that are historically underserved, yet the appetite for connectivity between merchants and customers is high,” Chief Executive Tony Xu said in a statement.

SoftBank backs some of the largest delivery services in Japan such as Uber Eats from Uber Technologies Inc and Demae-can Co Ltd.

Last month, DoorDash raised its forecast for annual gross order value, as stimulus checks helped keep food delivery demand resilient in the first quarter, even as vaccinations and as easing of curbs encouraged dining-out again.

DoorDash reported a near three-fold jump in quarterly revenue to $1.08 billion. They have branched out into delivery from grocery and convenience stores last year.

The company saw a surge in order volumes during the pandemic as consumers were hesitant about stepping out of the comfort of their homes due to COVID-19.

Want to Enter Japan Market?

Having local help on board is essential in order to be successful in Japan Market Entry. Don’t know where to start? We can help!

COVUE is a trustworthy Japanese company that has import licenses for many product categories. Let COVUE’s regulatory experts help you to speed up the market entry process so can that you can focus on your business. We’re here to help! It’s what we do best!

Toyota and Honda suspend vehicle production in Malaysia due to lockdown

COVID-19 is now interfering with the production of vehicles. Toyota Motor Corp and Honda Motor Co have put a pause on producing vehicles at their plants in Malaysia the country began a two-week total lockdown to stem the spread of the coronavirus.

Due to the reduced workforce, both companies have decided it would not be enough to keep their factories running. Virus cases are rising in Malaysia as vaccination against COVID-19 lags. Japanese automakers and automotive parts makers also have plants in other countries in the region, such as Thailand and Indonesia, where cases are also increasing.

The companies could face production delays if infection rates worsen in those countries. In Malaysia, Toyota has two plants in Selangor State, while Honda has a motorcycle plant in Penang State and a car factory in Malacca State. The officials said that after-sales service for car owners will continue while new car sales are suspended.

Toyota produced about 50,000 passenger and commercial vehicles in Malaysia last. Honda says its motorcycle factory has the capacity to make 300,000 units annually with its car plant capable of producing 100,000 units.

What is Trade Compliance and Why Does it Matter?

In today’s global marketplace, companies do business both within and outside Japan. Your supply chain depends on following various trade agreements, international trade regulations, and tariff classification.

Yet, even with these specialties, many companies unintentionally receive import and export violations, and these violations lead to hefty penalties and fines for failure with trade compliance functions.

International business is more complex than ever before, and this is why you need a clear understanding of the rules of export control, customs authorities, and export laws. As a result, exporting and importing have become an essential part of day-to-day operations. Since your business relies on global trade, your company needs to ensure that your operations have solid global trade compliance.

To remain competitive, companies must have a comprehensive understanding of the laws and regulations which govern their imports and exports. Very simply, that’s what trade compliance is all about!

What is trade compliance?

Trade compliance means to comply with international export, trade, and financial laws.

Who is required to comply?

Businesses from across all industries are obligated to adhere to compliance requirements. It is not just a regulation for security-sensitive industries such as telecommunications, IT, research, aerospace, or financial institutions. The penalties for non-compliance can be severe.

Why does trade compliance matter?

Trade compliance is vital for importing and exporting and is a responsibility for all businesses. The larger the business, the greater the compliance expectations. In order to be compliant, you must understand what rules and regulations applicable to your business. To be compliant means to meet the demands of customers and suppliers while supporting sustainability, long-term growth, and competitive advantages. These are key elements to a successful global supply chain.

Benefits of being trade compliant:

  • Corporate reputations and employees are protected by facilitating legal and responsible trading.
  • Exposure to fines and penalties are minimized.
  • Promotes customer satisfactions by avoiding shipment delays.
  • Saves money by avoiding delays, investigation and penalties.


Consequences of non-compliance:

  • Shipment delays
  • Financial penalties
  • Criminal sanctions

Key elements of trade compliance:

  • Tariff classification – The correct classification of goods using commodity and tariff codes is fundamental for customs compliance as well as establishing correct duty rates, the origin of goods, Intrastat, export control, and many other customs procedures.
  • Preferential origin is associated with a specific trade agreement between two countries or blocks of countries. If the goods you’re exporting have a preferential origin, they are likely to attract reduced or nil rates of duty when they enter your customer’s country.
  • Non-preferential origin is where it dictates the origin of the product being shipped. The rules associated with the identification of origin are specific to the rules of the importing country.
  • IncotermsIncoterms have globally recognized trade terms used to clearly define the responsibilities of the buyer and seller along the shipment lifecycle, they are integral to a contract so that both parties are clear on delivery, costs, risk, and responsibility.
  • Licenses & Permits – It is your responsibility to check if you require a permit or license when importing or exporting certain products. There are controls, for example, on military/paramilitary goods, technology, medicines, chemicals, artworks, plants, and animals.

Your goods will be confiscated and will be delayed if you are importing and exporting without the right license.

  • Exports controls – Certain products are subject to export control legislation as they could have harmful uses. it is your responsibility to classify all products against the appropriate legislation. This will ensure the correct license requirements can be established.
  • Customs Management – Have a clear plan of action if your business is subject to a customs investigation.
  • Screening – Screening customers, vendors, and transaction data against sanctioned, politically exposed persons and other risky entities will help ensure you are not inadvertently doing business with an undesirable person.
  • Valuation – Every shipment must have an appropriate valuation associated with it, which should be defendable if challenged. The valuation must comply with one of the six valuation methodologies approved by the World Trade Organization (WTO) and be declared on the Single Administrative Document (SAD or form C88).

Market Entry in Japan

Having local help on board is essential in order to be successful in Japan Market Entry. Don’t know where to start? We can help!

COVUE is a trustworthy Japanese company that has import licenses for many product categories. Let COVUE’s regulatory experts help you to speed up the market entry process so can that you can focus on your business. We’re here to help! It’s what we do best!

The Japanese Government about extending the state of emergency.

Japan will decide Friday on whether they will extend COVID-19 state of emergency. Tokyo, Osaka and seven other prefectures were set to be released from the state of emergency beginning of next week.

The infection numbers in Japan’s latest coronavirus wave have not lowered and are leaving the medical system under considerable strain. Many prefectures have requested for the government to extend the emergency. Health minister Norihisa Tamura said he will be making a decision based on expert’s evaluations. The current state of emergency is set to end Monday in 9 prefectures including Hyogo, Kyoto, Hokkaido, Fukuoka and Okayama.

The new end date for the state emergency might be June 20 now. Osaka Governor, Hirofumi Yoshimura said it is up to the central government to decide on the end date but that only extending the date for a short period of time would be insufficient.

The Osaka prefectural government is requesting the central government to extend state of emergency due to shortage of hospital beds. It will request together with neighboring Kyoto and Hyogo prefectures. Tokyo is also considering making the same request. Norihisa Tamura said new cases are declining in Japan overall, but worsening in specific areas.

Japan’s vaccine rollout has been slow compared to other developed nations. Only 2% of Japan’s population have received 2 doses of COVID-19 vaccine.

Source: Japan Today

Doing Business In Japan: Important Etiquette Rules You Need To Know

Every country has a unique culture and is used to do doing things a certain way. Doing business in Japan is a bit different compared to other countries. Japanese are more formal, calm, and reserved. Take a look at Japan’s values and what it means in the business industry.

  1. Silence is Golden

In a business setting, silence is more professional than an overabundance of talking. Silence demonstrates emotional self-control and wisdom. In western culture, we are more outgoing and loud when it comes to communicating. When developing a business relationship in Japan, have a formal and introverted approach in the beginning.

  • Group Solidarity is Paramount

Japan is a group-oriented culture contrast to the west where we believe individualism is valued over group solidarity. In japan, singling out an individual is embarrassing for them. The concept of a team is important for the Japanese. When giving out recognition, make sure to address the entire group.

  • Business Cards are Talismans

A business card is an extension of their identity in Japan. Accept the business card with both hands. If you are standing, read it briefly and place it in a card holder. If you are seated, place it on the table during the meeting. It is considered disrespectful if you place the card in your pocket or wallet. If you are presenting your business card, turn the Japanese side faced up and hand it to them with both hands. Don’t toss or slide the card across a table.

  • Age Equals Seniority

Japanese respect elders. Treat older executives with a more marked deference than the younger ones in the group setting you are interacting with. Greet the senior person before you greet the others as well as offering your business card to seniors first before the others.

  • Hard Sell Doesn’t Sell

Japanese do not like to be pressured or confronted. When pitching your business proposal, approach the presentation in a gentle and persuasive way. Don’t emphasize so much on decisions and deadlines. Focus on points you mutually agree on and build on that. Take you time during the pitch. Japanese see rushing the process as disrespectful. Use the time that you find wasted during the meeting, to build trust and cement the business relationship.

Market Entry in Japan

Having local help on board is essential in order to be successful in Japan Market Entry. Don’t know where to start? We can help!

COVUE is a trustworthy Japanese company that has import licenses for many product categories. Let COVUE’s regulatory experts help you to speed up the market entry process so can that you can focus on your business. We’re here to help! It’s what we do best!

Radiation checks on food conducted across Japan

Since the nuclear accident at Tokyo Electric Power Company Holdings, Inc.’s Fukushima No. 1 nuclear plant in March 2011, food products have continuously been checked for radiation. Nearly 17 prefectures are testing food products that are not listed in the guidelines such as vegetables, fish, and other items. These tests comfort domestic and overseas consumers even though it is rare for these products to exceed the national standard for radiation. The Yomiuri Shimbun has discovered that 11 prefectures are conducting radiation tests on their own.

For food items such as rice and vegetables, the national standard of maximum acceptable radiation levels is 100 becquerels per kilogram. Japan is much stricter compared to European and the United States standards. The European Unions’ maximum is 1250 becquerels per kilogram and the United States’ is 1200 becquerels per kilogram.

The provisional standard for maximum acceptable radiation level was originally 500 becquerels per kilogram, but it was revised to 100 becquerels in April 2012. The standard for infant food and milk is 50 becquerels. However, the standard for drinking water is 10 becquerels per kilogram. The areas to be inspected for radiation in food are determined by the government’s Nuclear Emergency Response Headquarters.

As of March 17, 2021, wild mushrooms, wild mountain vegetables, and meat from birds are now required to be tested by prefectures in eastern Japan. These products can no longer to shipped if the radiation levels exceed the national standard.

According to the Health, Labor, and Welfare Ministry, 54,412 items were tested nationwide in 2020, and only 0.23% or 127 items exceeded the national standard. One of 127 items came from an unknown origin. The other 126 items underwent an inspection. The Fukushima Prefecture will continue testing. They are also testing tomatoes, cucumbers, and other vegetables that not required for inspection. As of 2015, no radiation has been found in these products. The prefecture will continue testing to rebuild trust again and dispel the long-lasting negative rumors after the nuclear accident.

15 countries restrict imports from Japan and even require inspection certificates.

Import Products to Japan?

Let COVUE’s regulatory experts help you to speed up the market entry process so can that you can focus on your business. We’re here to help! It’s what we do best.

At COVUE IOR, we seek to make the import process simple, compliant, and accessible to all sellers of all sizes. COVUE is not an ACP. COVUE is the direct IOR: we own our license, and our compliance support is in-house. We trusted by 000’s of Sellers and Shipping providers.



Source: The Japan News ​​