Posts Tagged ‘Japan’

Is Silver The New Gold? Tips From The World’s Fastest-Aging Market

March 8, 2013

One of the biggest fears among young people is simply the fear of getting old, and society is obsessed with youth. Get ready, because the world population is aging fast. According to the World Health Organization, by 2050 22 percent of the world’s population will be over 60 and the number of people 80 or older will quadruple. This change has major implications for the global economy and all aspects of life – from healthcare to housing, workforce to personal finance, and product development to branding, marketing and communications.

Japan is the world’s fastest-aging society. With the highest life expectancy in the world (86), one in four people are currently over 65. This is expected to increase to one in three by 2040. This presents serious challenges in coping with increasing costs for pensions and healthcare in Japan. On the other hand, increased spending by seniors (called “the silver market” in Japan), estimated to be 100 trillion yen (US$1.27 trillion) a year, is creating new opportunities for the economy. Japan seems to be out front in developing and marketing new products and services targeting seniors and penetrating the growing silver market. Here are some examples.

  • Fujitsu just showcased a prototype of its New Generation Cane at the Mobile World Congress 2013. This product is a “smart cane” with GPS, Wi-Fi and Bluetooth. It has an LED panel on top that displays information and provides simple directional instructions for the user. A sensor on the top of the device monitors heart rate and the cane can also keep tabs on location, humidity and temperature, sending the information back to the user’s family, friends and caretakers.
  • Japanese wireless carrier NTT DoCoMo launched a new line of smartphones in 2012 targeting seniors, called Raku Raku (meaning easy easy). The phones have larger fonts and icons with simplified steps for sending email and taking photos. Senior-friendly features include audio adjustment that can slow down and clarify the voice on the other end. Also, with one push of the ‘how to use’ key, the phone will connect users to dedicated Raku Raku customer service staff.
  • Just about every Japanese girl has owned a Licca-chan doll, the Japanese equivalent of Barbie, since it was launched in 1967. (Barbie never caught on in Japan because she looked too foreign and adult to young Japanese girls.) Last year, Takara Tomy, Licca-chan’s maker, introduced a new doll, Licca-chan’s grandmother, named Yoko, targeting real grandmothers who enjoy playing with their grandchildren.

    Licca-chan & Yoko

  • Last year, Toyota unveiled a robot for seniors that can fetch, carry things and perform simple tasks using its fingers. Multiple companies are developing these types of robots with innovative technology to act as caretakers. A survey showed that 80 percent of Japanese seniors welcome the robots because they hate to burden their families with their care.
  • An electric kettle is a must-have item in a Japanese household. Zojirushi developed one for seniors living alone. When the kettle, “i-pot,” is used, the information is sent in the form of an e-mail to family members so they can monitor their parents/grandparents’ daily activities and be assured that everything is normal. Some communities are offering similar measures, products that use sensors and wireless networks at seniors’ households to monitor their safety. The Japanese government also introduced a measure with a more human touch in 2011: postal workers check up on people over 65 once a month by handing seniors seasonal greeting cards.
  • Retailer Aeon opened its first supermarket aimed specifically at seniors, with a range of products and services geared to their needs, such as a shopping cart with a built-in magnifying glass. Many supermarkets and department stores are shifting their business models in this way with items, displays and services catering to the silver market.
  • Large numbers of “dankai-no-sedai,” Japanese baby boomers, born between 1947 and 1949, have been retiring, and the travel industry is capitalizing on increased spending by the growing retiree population. According to a Japan Association of Travel Agents survey published last year, senior travel was stronger than travel by families, students or honeymooners. Since Japanese companies are not generous with vacation days, traveling is at the top of everyone’s wish list after retirement. The tourism sector is eagerly introducing new products and services targeting active retirees as well as the elderly with health-issues, including medical help and assistance from people who act as “travel helpers.”

What’s the best way to market and communicate to these growing consumers? I’ll cover that in another post.

Keiko Okano

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Diary From Japan: Ongoing Failure to Build Institutional Trust Takes a Heavy Toll in Crisis

March 18, 2011

This is the worst week I’ve ever spent in Tokyo. That goes for me and about 125 million other people.

I’d planned to be here and had meetings set up for a long time, and I was already in Bangkok about to come here when the earthquake hit. The people I had meetings with in Tokyo let me know they were ready, willing and able to meet, despite the earthquake. I was already in Asia, so rather than return to the U.S., I came to Tokyo as planned last weekend. For readers who don’t know much about me, I lived in Japan for a few years in the late ‘80s and have been here countless times on business trips. However, the past six days since my arrival are an entirely new experience for me. 

By now, you’ve all read reports of the 9.0 earthquake, seen video footage of the tsunami wave that reached as high as 60 feet and wiped out entire villages, and you can’t help hearing about the danger posed by tsunami damage to four nuclear reactors at a Tokyo Electric Power Company (TEPCO) plant.  Aside from growing levels of radiation near the plant, one of the biggest dangers here is a communications problem. It started with TEPCO under-stating the problems with the reactors to the Japanese government, which then repeated what TEPCO said and (unknowingly, I believe) under-stated the dangers to the Japanese public. The public has no trust in TEPCO anyway – the company has been caught in lies to the public before on numerous occasions, including safety reports that were falsified for years and forced the resignation of the company’s chairman and president. Since the government has a long history of inaction against the company’s wrong-doing in the past, there is also a low level of trust in the government.  A Bloomberg article today says, “Nuclear engineers and academics who have worked in Japan’s atomic power industry spoke in interviews of a history of accidents, faked reports and inaction by a succession of Liberal Democratic Party governments that ran Japan for nearly all of the postwar period.”

I can’t help thinking about the role that consistently good, honest communication plays in creating trust in institutions. Too many Japanese government institutions have ignored this basic principal of public relations, and the people of Japan are paying a high price for that now.

About 400,000 people who live near the plants have been evacuated. First we were told this was a precaution. Now we are told this is a necessary health measure. The “danger area” was defined by the Japanese government as within 20 km of the plant (about 12 ½ miles). However, the American government now defines the danger area as within 50 miles of the plant, based on its data collection flights over the area.  This also causes one to speculate: are the Japanese authorities still trying to downplay the danger, or is the American government’s calculation unnecessarily conservative and just feeding fear and anxiety? The American media’s headlines are alarmist: “Frantic Repairs Go On at Plant as Japan Raises Severity of Crisis,” writes the New York Times today. This sells papers, but also helps increase the stress levels.

Because the power companies and government feared the nuclear reactor shut-downs would cause a severe power outage, planned blackouts began early this week in and around Tokyo for several hours at a time, rolling from one area to another, to cut usage. This has never been done before in Japan. The plans for these electrical power outages were not communicated well by the power company. Nobody was sure when or where power would be cut, and commuters feared being stranded again as they were a week ago in Tokyo when trains stopped running after the earthquake. Some of the Tokyo subways and trains are running slowly due to cancelled trains and/or reduced service, both of which are unpredictable. (Anyone who has been to Japan knows that this is truly extraordinary, since trains generally run on time within seconds here.)

Yesterday I took a train during the evening rush hour that was packed tighter than I’ve ever seen any subway train, either here or in New York: I could feel the wallet of the person next to me digging into my side. At each station we came to, there was a sea of people on the platforms waiting to get onto a train.

There is no lack of cooperation or effort by the public in saving power: many companies sent people home early yesterday to save electricity, and a lot of workers have been told to work from home. Lights have been dimmed in buildings and public places, escalators have been shut off and thermostats turned down.

Fear of gasoline shortages has actually helped create shortages. I heard that the line to buy gas was a half-mile long at some gas stations and others had run out of gas and were closed.  Gas rationing had to be instituted, and the government announced it has ordered oil companies to release their reserves in order to relieve shortages.

Despite pleas by the prime minister for calm, food, water and batteries have disappeared from the supermarket shelves here in Tokyo. People fear another big quake in addition to the nuclear crisis, so they’re hoarding food, bottled water and batteries against the possibility of another natural disaster or a man-made nuclear disaster. A business colleague said he was going from one 7-11 shop to another looking for bread, rice, milk and other staples because his wife said she couldn’t buy any of these items at stores in their neighborhood.

A couple of days ago I heard the local governor in the area hit hardest by the tsunami being interviewed by NHK, the public television network. He said the biggest problem after the lack of gasoline is inconsistent or vague communications from the government and electric company spokespeople about the dangers from a nuclear plant explosion. People just want to know what’s going on. Even if what the government is telling them is the truth, the government doesn’t have enough credibility to get people to believe it.  As a result, there are all kinds of rumors floating around about the danger posed by the reactors.

There is no violence or looting. Despite these extraordinary circumstances, people have remained calm (at least on the surface), lined up politely at the grocery store cash registers and in gas station lines, and waited in orderly queues for taxis. One sees the typical Japanese dedication to work and company everywhere: I heard about people walking for four hours on Friday after the earthquake to get home from work, and then coming on foot or by bicycle to get back to work again on Monday. The prime minister has asked for cooperation and patience, and that’s a perfect description of the behavior displayed by the Japanese people.

Geological experts have predicted continual aftershocks that could go on for months or even years. I’ve lost count of the small earthquakes I’ve felt.  I’ve experienced four or five fairly large ones.  According to scientists, there’s a high possibility of another very large earthquake occurring before the end of this week, but that possibility diminishes as time passes. And the end of the week is just about here.

I’m going home tomorrow, luckily for me, but people here will continue to live with the stress of the nuclear crisis and the sorrow about the tremendous loss of life for a long time to come.

Lucy Siegel

20 Years of U.S.-Japan Pharma Industry Change

November 18, 2009

The launch of U.S.-Japan pharmaceutical industry group New York Pharma Forum in December, 1990 took the form of a symposium followed by a black tie dinner at the Waldorf Astoria’s Skylight Roof. If memory serves, about 70 people came to the symposium, and a little over 200 were on hand for the first annual dinner. There were speeches at the dinner by Ed Pratt, then the CEO of Pfizer, and by Shigeo Morioka, CEO of Yamanouchi Pharmaceutical Co., who, along with Haruo Naito, Director General of Eisai Co., came from Tokyo to participate in the launch. Mr. Naito gave the “kampai,” or toast, and then took part in a Kagamiwari ceremony, for which he and several of the other VIPs in attendance donned traditional happi coats and then broke open a sake barrel.  We hired a dance band for the occasion, but I was told by the Japanese executives that there was little likelihood of getting the Japanese couples to dance. My staff and I received more than a few calls from Japanese executives before that first dinner asking us, at the instruction of their wives (yes, they were all men), what the women should wear, whether a kimono was appropriate since it was considered formal wear in Japan, and what black tie really meant. They were anxious to fit in and wanted to be properly attired.

Those of us who were there 20 years ago can attest to vast differences between then and now.  There are superficial ones (besides our wrinkles): the Japanese never call anymore to ask what to wear, since they are quite accustomed to Western-style entertainment; unfortunately, it’s been quite a few years since we’ve seen a beautiful, graceful Japanese kimono at one of these events; the Japanese and Americans agreed that long speeches were too boring for a black tie dinner, and they were restricted to the afternoon symposium; and the dinner has now become a dinner-dance, with plenty of Japanese couples dancing as well as Americans.

The deeper differences in New York Pharma Forum  reflect the results of two decades of change in the industry. NYPF’s Japanese leaders of have been at the forefront of that change. Two of the speakers at this year’s 20th anniversary symposium are a case in point.  The Japanese companies, which all firmly stated 20 years ago that mergers were a Western phenomenon that would never affect them, have nevertheless undergone consolidation, including mergers with American and European companies. Hatsuo Aoki, president of NYPF from 1994-1995 while he was head of Fujisawa U.S.A. in Chicago, went on to head Fujisawa globally and was the driving force behind its merger with Yamanouchi to create Astellas, now one of the few global Japanese pharma companies. 

In 1989, Eisai was headed in the U.S. by Soichi Matsuno, president of NYPF from 1997-1999.  He had a handful of employees on his staff 20 years ago.  By the time he left the U.S. 10 years ago, Eisai had grown exponentially and entered the ranks of global pharma companies.  Today he is Deputy President of Eisai in Tokyo, and Eisai Inc. in the U.S. has  thousands of employees and is in essence an American company, with all American employees except for a couple of expat Japanese. The company has developed and launched new drugs in the U.S. market before even introducing them in Japan. 

We shouldn’t underestimate the difficulties that these and other Japanese expatriate executives have had to overcome to make their companies global competitors. There are cross-cultural business differences such as very divergent human resources and compensation systems between the U.S. and Japan, for example.  The language barrier alone is tough for most Japanese. One pharmaceutical  company executive from Japan said that when he first came to the U.S., around the time that NYPF was launched, he spoke English very poorly and had a hard time understanding what was going on around him. He recalls being utterly miserable for months, but he was determined to learn the language and the culture. He obviously  succeeded: Dr. Isao Teshirogi met the challenges here in the U.S. and is now president of Shionogi & Co. in Japan. The American president he appointed to head Shionogi U.S.A., Dr. Sapan Shah, is a vice president of NYPF.

It’s hard to express how satisfying it is, having been involved in the development of this organization 20 years ago, to see the rise and success of so many of the people I’ve worked with – both Japanese and American. I wish that Shiro Yamasaki could be on hand for the 20th General Assembly and Annual Dinner to celebrate with us. Not surprisingly, however, he now occupies a very senior role in the Japanese prime minister’s cabinet, and unfortunately he can’t get away.

— Lucy Siegel

New York Pharma Forum Comes of Age

November 16, 2009

 It’s easy to get caught up in our daily client work, but sometimes it’s important to take a look back to see the progress we’ve made.

20 years ago in mid-November I was in the throes of preparing for the launch of a U.S.-Japan pharmaceutical organization, the New York Pharma Forum (NYPF). Today my staff and I are working feverishly to get ready for the same group’s 20th anniversary of that event, its 20th General Assembly and Annual Dinner: inviting media, coordinating the program and speakers, and handling a thousand logistical details for an international event with 300 people.

The idea behind this organization sprang from the creative mind of Shiro Yamasaki, who had been sent to work in New York by the Japanese Ministry of Health & Welfare. It was ingenious for a few reasons. Those were times of terrible trade tensions between the U.S. and Japan (at about that time, members of Congress smashed a Toshiba radio outside the US Capitol with a sledgehammer).  The last thing the Japanese government wanted was to have trade tensions spread from Toshiba to Takeda, the largest Japanese pharmaceutical company. 

Before the 1980s, there were few Japanese pharma companies in the U.S.  The Japanese government protected its pharmaceutical industry for many years against the onslaught of large overseas companies. However, by 1989 there were clear signals that these companies would have to face international competition at home.  The more savvy US Flag Summarycompanies knew this meant they had to move into overseas markets. The Japanese market was (and is) the second largest in the world for the pharma industry, and until then the Japanese companies made a comfortable income at home and hadn’t made a big push overseas.

Shiro Yamasaki knew these companies were entering a new era. He also saw the wide gap in the business culture they had to cross to have a chance of success in the U.S. market. When an important new drug is discovered, people worldwide want access to it. But medical treatment methods, health care systems, government regulations and marketing and communications differences create unique pharmaceutical industry environments and cultures in each part of the world. “Big Pharma” companies have been globalizing for decades, which really means becoming part of each local culture.

In 1989 the Japanese pharma companies’ U.S. subsidiaries had only a handful of employees, many of them from Japan. I don’t think a single one was marketing its own drugs in the U.S. Profits from drug licensing are only a fraction of those from direct sales, however.  Efforts towards international harmonization of drug approvals were just beginning, and Japanese companies were only doing drug development work in Japan then.  Japanese pharma companies understood the need to build the infrastructure and know-how to develop and sell their products in the lucrative U.S. market.

The Japanese pharmaceutical companies had a lot of catching up to do. New York Pharma Forum was a perfect venue to bring them together with Big Pharma, where they could be exposed to the workings of the international pharmaceutical industry. At the same time, the American companies welcomed the chance to meet and talk to Japanese government officials in an informal setting and get to know some of the senior executives sent here from Japan as a way to facilitate deal-making. 

How has NYPF developed over 20 years? Stay tuned for part two of this post.

— Lucy Siegel


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