Japan
Currently, Japan’s economy is one of the most developed economies in the world. In terms of industrial production and GDP, the size of the state ranks third among the countries of the world, yielding the position only to the United States and China. Japan has a very advanced high technology (robotics, and electronics), automobile and shipbuilding sectors (Central Intelligence Agency, 2015).
Special attention is paid to the development of science and education. State program of research and development (the development of a national system of research and development activities) contributes to the development of its own technic achievements and complete abandonment of the import. Special research centers, which were engaged in developments in the field of solid state physics, space robots, nuclear energy, new structural materials, plasma physics, and other issues, were created on the territory of the country.
The main distinguishing feature of trade relations is that Japan completely buys raw materials and exports manufactured goods. This trade refers to value-added trade. The main products Japan imports include oil, liquefied petroleum gas, simple circuits, textiles, fish and seafood and computers. The main export products of Japan are sophisticated chips, vehicles, chemical products, steel and goods of engineering industry. The main trade partners of the aforementioned state are the US, China, Saudi Arabia, Republic of Korea and Australia (Trading economics, 2016).
Japanese social structure is characterized by the dualism of modern industry. Small and medium-sized companies occupy a major place in the manufacturing industry. In this, the part of small firms does not observe pronounced downward trend. It is against the background of the mass of small businesses the significant concentration of capital in heavy industries was rapidly developing. It just led to the formation of giant associations. Features of the economic system of Japan include (Central Intelligence Agency, 2015):
Vertical integration of companies and their grouping (large companies combine with small and medium-sized organizations);
Presence of a three-layer structure, namely the market – a group of companies (keiretsu) – owned company (legislation prohibited to absorb small businesses. Mainly the last are subordinated to large companies. This limits the process of capital centralization and provides for the unanimous consent of heads of subordinated enterprises).
The Land of the Rising Sun welcomes the so-called system of “lifetime employment”. The employee for the rest of his/her working life remains faithful to only one organization. Under such system over time an employee considers working collective as a second family, and work – home. An employee ceases to distinguish between personal goals and objectives of the corporation. In the solution of common problems in the country of the Rising Sun, the unity of the state apparatus and large companies is obvious. The country very actively uses planning system of national, target, regional, in-house and sectoral levels (Central Intelligence Agency, 2015).
In recent years, Japan has become a major supplier of high-precision machinery, electronics and cars on the world market. The products of the above sectors of the economy are characterized by very high quality, very fast change of models and constant improvement. This makes it very popular and in demand among consumers.
Marketing activities in Japan is quite different from that adopted in the West and represents the different geographical, social and historical factors, and particularly the state structure. The following factors have a direct and indirect impact on the Japanese marketing strategy: cooperation between industry and government, industrial atmosphere, products targeted at the global market. Marketing in the Japanese version is common feelings with the consumer and satisfaction of his/her desires at the same level as the manufacturer would satisfy his/her own desires. The Japanese version considers the tastes and desires of the customer as the innate traits that need to be satisfied without reasoning. However, this does not mean that Japanese companies play the role of passive performers of customers’ whim. Moreover, given the clients and customers advices via excellent feedback-established, companies are trying not to lose the initiative in their hands (Ferrell, et al., 2014).
The importance of product marketing and order fulfillment, marketing functions, and the status of marketing departments in Japanese companies are different depending on the profile of the companies and industries. In the technology and engineering companies in the industry, for example, the main role is played by the manufacturing and engineering departments, which have a great influence on the strategic decisions. Here, the role of marketing is less visible. In such circumstances, it is difficult for the head of the marketing department to rely on the post of Managing Director. In the construction business, manufacture of electrical products and transportation, leaders from among production engineers dominate at the top management level (Keegan and Green, 2014).
In general, marketing departments have a higher status in the service industries than in material production sectors. Even within the sectors of material production, the marketing function is perceived differently. The industries producing manufactured goods, where the relationship between buyer and seller assumes long-term stability, marketing efforts may not be as vigorous as in industries, producing consumer goods.
Speaking about Japanese distribution channels, sophisticated by long series of intermediaries, they are often criticized by foreign marketers, who would like to enter the Japanese market. Nevertheless, the Japanese companies are the reasons for this seeming inefficient system. One of them is to meet individual family daily demand for purchase and maintenance. That did not happen until the end of the 60’s, when proposals to modernize the Japanese distribution system aroused from both the government and the business community. Many companies are trying to reduce costs in the face of the constant increase in oil prices and raw materials, most of which have to be imported. Expenses for service channels in Japan, which are very high, have become the main target. For government an urgent need is to respond to complaints and criticism of foreign marketers and develop an effective service channel controlled by the computer system corresponding to information age (Keegan and Green, 2014).
Problems of Japanese distribution channels are different, however, between the industries and product categories. A common problem is an excess of independent mediators, which account for a significant share of the net income for the whole system of channels by a simple transfer of products from one layer to another system. The process of modernization, therefore, is linked with the abolition of intermediaries and integration services. This process was initiated in many cases by producers, and sometimes intermediaries, especially in big supermarkets and a network of branded stores (Ferrell, et al., 2014).
As a rule, sales to large industrial customers are called “related sales”. This means that the agreement for sale and its terms and conditions are drawn up in advance between the steel producer and industrial user through the mediation of wholesalers or mixed trading companies, which receive from 3% and the percentage of the total value of sales in the form of commissions. Another sales channel of steel products is the sale for immediate delivery in cash (without contract) through wholesalers and small intermediaries (about 5,000) under the control of large wholesalers (Ferrell, et al., 2014).
Thus, there are several ways of modifying the structure of channels: 1) to develop the company’s own channel under the guidance of the marketing department; 2) to establish a separate sales company, responsible for the company’s entire range of products; or 3) to organize the wholesale and retail outlets under the control of the manufacturer. Wholesale and retail stores often come into a special contractual relationship with the company, to deal exclusively with the company's range of products.
References
Central Intelligence Agency (2015). East & Southeast Asia: Japan. Retrieved from https://www.cia.gov/library/publications/the-world-factbook/geos/ja.html [Accessed: 24 February 2016]
Ferrell, et al. (2014). Marketing Principles. Cengage Learning Australia. South Melbourne.
Keegan, W. J. and Green, M. C. (2014). Global Marketing. 8th ed. Upper Saddle River: Prentice Hall.
Trading economics (2016). Japan – Economic Indicators. Retrieved from http://www.tradingeconomics.com/japan/indicators [Accessed: 24 February 2016]
