The Creator Economy and the Comprehension Gap
We hear “creator” a lot these days, but there may be a slight misunderstanding by many about what creators are, what they need, and how this affects the future.
There’s a gap in the understanding about creators and their needs by businesses and society as a whole
Creators need to be good in 3 pillars of the Creator-Market Fit in order to have long, successful careers
Being a creator is attractive and seen as easy, but its areas of difficulty will begin to drive the Creator Economy
We hear the word “creator” a lot these days. More and more people are focused on growing their personal brands, creating businesses around their passions, NFTs (non-fungible tokens) are taking off, and companies are looking for ways to scale their own communications.
Media was decentralized by the internet, and creators making content to become media entities of their own is the outcome.
This “Creator Economy” is only growing.
New tools, platforms, and marketplaces are constantly being built. The vast majority of them focus on 2 areas:
Distribution (ex: TikTok, Substack, ConvertKit)
Monetization (ex: Patreon, Ko-fi, Geniuslink)
Working in marketing at an agency and being somewhat of a creator myself, I’ve been thinking that there may be a slight misunderstanding by many about creators, what they are and what they need.
Let me explain.
Creator-Market Fit
This Creator-Market Fit was shared by Justin Moore, who educates about the business side of being a creator.
Moore states that in order for creators to achieve longterm success, they need a balance of 3 pillars: Psychological, financial and algorithmic strength.
Most creators only have 2 of 3 pillars, and as you can see in the diagram below, a 2-pillar combo has a weakness depending on which two the creator has.
Psychological strength - The ability to have confidence, avoid imposter syndrome, brush off negative feedback, etc.
Financial strength - The ability to monetize and/or support one’s ability to survive off being a creator
Algorithmic strength - The ability to understand various platforms, attention shifts and algorithm changes
So far, creators are assumed to be psychologically strong and attuned to the algorithms on platforms, therefore developing monetization services has been the focus.
The assumption isn’t necessarily wrong. Many creators, especially early ones, are likely relatively strong in those areas and that’s why they’ve been able to pave their own path early, grow an audience and find some success.
It’s great, but as Moore explains, there’s a lack of support in the other areas that if aren’t addressed, will lead many creators to diminishing careers or burnout.
Furthermore, just like anything that becomes trendy and gets glamorized, including entrepreneurship which is essentially what creators do, people will get Shiny Object Syndrome and flock towards it even though they may not actually be a great fit for it.
Part of the reason is that most don’t truly realize what it takes to be a successful creator.
The challenge of being a creator
I see this a lot on public forums like Quora: People assuming creators and influencers don’t do anything besides pose in front of cameras, or people asking if it’s possible to be one if you’re not good looking.
Being a creator is often thought to be an easy job, but it’s actually extremely difficult.
Being someone who takes photos and creates videos for Instagram, YouTube, TikTok, and a slew of other platforms myself…. it can be overwhelming to say the least.
To be successful, people first need to have a balance. Entrepreneur/VC Li Jin came up with her version of a Creator-Market Fit, and states that creators need to address “ABC”:
(A)udience - Who is the content for and do they want it?
(B)usiness model - Is this a sustainable business?
(C)ontent creation - Is making this type of content enjoyable or fulfilling?
The fact is that Creators are often a one-person media company, prOduction studio, and business consultancy.
The majority of creators are doing everything themselves, at least until they can hire help.
For example, here’s what a typical YouTube creator has to be able to do:
Identify trends and topics, and plan videos around them or around an original idea
Understand YouTube’s functions, how to use YouTube Studio, its best practices
Shoot and post-produce videos consistently, sometimes also effectively speaking in the video and/or on camera
Respond to people in comments and engage others
Analyze performance, plan optimizations and implement them
Potentially know how to use the ad platform and how to execute campaigns when needed
Know how to network, research potential collaborations, reach out and negotiate
Maintain mental strength to do this consistently despite setbacks, competition, negative judgement and feedback
And that’s not considering managing other social networks, building a community and monetizing.
So yes, it’s a lot harder than it seems, and it can eventually take a toll on creators. There is a mental and emotional wear and tear on top of the difficulty that hasn’t been fully realized by the masses nor focused on by businesses in the creator economy.
Not only are their financial needs necessary to address, but needs in the psychological pillar will only continue to rise.
What’s next for the creator economy?
Here’s a few possibilities based on what I’ve read and what I’m sensing.
1. Many more creators will continue to emerge
Becoming a creator is an increasingly attractive career option to many. It’s already a top job kids want to do when they grow up in the US and UK, and in Japan as well.
As the friction it has with society’s ability to accept it as a legitimate career continues to fade away and new tools are developed, more will attempt to be one.
Like in my previous blog about the influencer who launched a national DTC burger chain, people are understanding that building awareness means growing opportunities for themselves, and everyone wants that.
NFTs and their potential to more accurately assign credit and deliver payments to creators will strengthen viability.
A sign that we’re moving in this direction is the news saying that even with high unemployment, companies can’t fill positions. Covid has led people to reconsider their lives and how they’re living it. And with “new age” career options in the gig, passion and creator economies, more and more people will stop buying into companies in a middleman economy with weak visions and controlling contracts.
2. Creator Economy startups will grow in the psychological pillar
The focus on distribution, monetization and finance for creator economy startups has left the psychological pillar largely undeveloped. This will change as both creators and competition increase.
Mental health and behavioral health above it are already a rapidly growing space now, so it’d be safe to assume that services focused on creators’ psychological wellbeing in particular will begin to pop up.
3. Next-gen financial support for creators will arise
Areas around cryptocurrency, DeFi (decentralized finance) and the NFT market will continuing to grow, and so will services looking to help creators.
Companies like Collective already exist as an outsourced back office for solopreneurs, and more will be come up to help creators navigate these spaces.
There will likely also be a growing need to address the class split that will increasingly impact creators.
The majority of creators tend to be on the financially stable side, hence the ability to take the risk to be one. As Karol Jan Borowiecki, an economics professor at the University of Southern Denmark said, “One could hypothesize … if my family is well off, and my career doesn’t go as planned, I can fall back on that financial net.”
The balance of who actually can even try to be a creator is already tipped.
Additionally, creator funds and platforms like Pearpop where people bid and take part in challenges to gain shared screentime with TikTok influencers and celebrities tend to benefit the biggest and best creators the most.
This has thought leaders talking about UCI - Universal Creator Income - to address the lower and middle class of creators that will inevitably grow. But that’s a topic for another day and something I’ve yet to truly dive into.
In any case, it’s a very interesting time, and when we talk about creators, influencers, personal brands… something tells me they’re at their infancy.
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Clubhouse - My First 48 Hours With the Audio Social Network
The latest social network to buzz, this one is different - it’s audio only.
Clubhouse is the latest social audio network to take off, starting in 2020 and reaching Japan in January 2021
It is designed to replicate real life events and social interactions
It’s growing from Millennial and Gen-X thought leaders
Clubhouse is one of the most recent social apps to take off. Unlike the other major networks, this one is different - it’s audio only.
I’ll talk about what the app is, how to use it, how it’s growing, monetization, and my thoughts on it.
What is Clubhouse?
Clubhouse is a social audio app that is designed to mimic offline events and social interactions.
Think of going to an expo around your interests. There are probably multiple rooms and booths, speakers giving keynotes, discussion panels you can listen to, Q&A sessions, and random run-ins with acquaintances as well as new introductions. You can stop and listen to them, participate, or move along to the next thing.
The app’s design, which I’ll show below, is made to replicate this experience.
Even when a new user joins, any acquaintance they may have that is already on Clubhouse is pinged to welcome them. The co-founders also host weekly talk sessions to welcome new users.
People have been using Clubhouse for just under a year, with the earliest users being allowed on between spring and summer 2020. It began gaining more users towards the end of the year, and started being all the buzz in Japan in late January 2021.
Availability
At the moment, it’s similar to early Facebook in terms of exclusivity. Think 2004-2005 when you needed an email address from specific universities in order to create an account.
Joining is through invitation only so the platform is entirely community-driven at the moment. People receive 2 invites to give out initially and then gain more as time goes on.
It’s also mobile-only and only available on iPhone. Android is aimed to launch in 3-6 months, and they’re building out their development team now, according to co-founder Paul Davison.
Priorities
Clubhouse has 4 general priorities:
Performance - To ensure a good user experience. This is why they’re carefully scaling rather than immediately opening it up to everyone.
Support - To maximize the in-room experience, they want to provide creators and moderators the tools they need
Safety - Clubhouse has a one-strike policy when it comes to misconduct and will ban anyone who breaks etiquette. They feel diversity is the best thing about the platform, and encourage a variety of people to come together to express their opinions and have thoughtful, difficult discussions. They prioritize maintaining that.
Discovery - To help people find the conversations that best suits them, they plan to work on algorithms and optimize feeds.
How do you use Clubhouse?
There are 2 main screens to focus on: The Home feed and the Room.
The Home feed
This is a feed of rooms tailored to you. Think of it as a personalized schedule of what’s happening at the expo. This feed is tailored based on the people and “Clubs” (communities, groups) you follow.
Above are a few icons. From left to right: Search (to find people and clubs), Invites (to invite new users), Calendar (a list of upcoming events that are outside of what you follow but may be interested in), notifications, and your account profile.
At the bottom lies the option to start your own room. You can make it “Open” for anyone, “Social” for people you follow or find interesting, or “Closed” and private.
When you create a room, mutual followers will get pinged.
Room
This is the actual event. You’d think it’s intimidating to join because it’s like entering a phone call, but it’s not.
You are automatically muted when you enter, and there are no notifications that go off. You can tap the hand icon to raise your hand for a chance to speak if you want to, hit the “+” button to ping friends about the room, and leave quietly whenever you want. Ghosting is actually encouraged by Clubhouse.
The design of the room is also meant to mimic real life.
The Room is divided into 3 sections.
The Stage (or Speakerbox) - The room creator, moderators, and speakers
People followed by the speakers - Think of them as VIP guests in the front-row
Others in the room - The general audience, where you’ll be in most cases
Growth & Usage
People may think a social platform’s growth is initially driven by the young. While it’s common, Clubhouse is more akin to Twitter, which had a lot of Silicon Valley and tech Millennials and Gen-Xers onboard first. Clubhouse’s early users are of a similar makeup.
This is important for a few reasons.
Clubhouse is extremely reliant on people’s ability to provide users value through audio only. Users need to want to listen to dialogs in order to decide to spend time on the platform and invite their peers. There’s no visual space to show amazing photos or captivating b-roll transitions. Having enough to say in a way that provides value to listeners comes from experience and education.
Rooms need to be moderated by actual people, not algorithms, to maintain a quality user experience. This also comes with experience and practice.
Younger people are more willing to listen to older people or others of a similar age that they can learn from rather than the other way around. This is seen in offline keynotes and speeches as well.
Clubhouse will likely grow beyond these primary, informative and engaging talk sessions, but growing this way allows the platform to establish their core culture and scale better.
Trends
Peak usage is said to be between 4PM and midnight, but the platform’s cofounders are aware that things may change as the Covid situation changes.
Some thought leaders and companies have created Clubs, where members or staff will host scheduled events. This helps build their brand and grow awareness, just like online livestreams.
Clubs are created to host conversations and grow a community, or just to communicate within an organization. To start one, you have to request it manually by emailing Clubhouse support.
This again highlights how companies need to reassess the talent of their staff, and make sure they can help the company maneuver in the increasingly interactive, digital-social environment that our guides our society today.
“PTR”
Clubhouse only has one visual - your profile pic. Because of this limitation, people who want to quickly show a photo will temporarily use it as their profile pic and tell listeners to “PTR”, or “pull to refresh”, before changing it back.
Clear Profiles
Because of only having an icon and first name shown when in a room, it’s best to use a clear face photo of yourself and real name (which they ask for). Almost all users do this. Wearing a mask to an expo with a nickname on your name tag may be seen as poor etiquette, so you shouldn’t here either.
Profiles should be written simply, and due to a lack of messaging capabilities, you should link your Twitter and Instagram accounts to your profile, capabilities provided by Clubhouse.
Monetization
Right now there is no monetization but Clubhouse plans to build out a monetization platform.
They’ve stressed that they only want to make money from creators who are making money, and they don’t want to interrupt the user experience with invasive ads.
While Clubhouse is still working things out, they will likely start with the ability for people to tip creators. After that, they may introduce other monetization methods such as membership dues or tickets to events or private sessions, etc.
Personal Take
Clubhouse has a lot of potential, it’s already buzzing and not many people are yet aware of it. The trajectory of growth may likely be affected by changes related to Covid, but it’ll be around as a dominant platform in social audio communication.
Twitter also is testing their Spaces, an add on function that looks to have similar capabilities - the ability for people to gather in rooms and talk. We’ll see what happens with that, however, it’s important to understand that having the same functionality doesn’t mean the same user experience. Instagram copied TikTok with Reels, but the algorithm, user emotions and experience are different.
I myself am more of a visual person - I take photos, make YouTube videos, learn by watching more than reading. Because of this, Clubhouse won’t become my go-to platform. However, I’d definitely tune in if there’s value being provided to me there.
While the lack of visuals may not be my personal preference, it works well for many and I am enjoying the app. If anything, it lowers the hurdles immensely to create content, host discussions, provide value, and even participate.
No camera. Lower hurdles. Frictionless experience. They're huge.
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My Year: 2020
A collection of highlights from my 2020.
A highlight reel looking back at my year.
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What Businesses Should Take Away From This Influencer Opening a Restaurant Chain
MrBeast opening a DTC burger chain highlights a shift in how new businesses now start and provides lessons for businesspeople to learn from.
YouTuber MrBeast opened a nationwide burger restaurant in the US
The drive-thru line was miles long, and his app ranked #1 in the App Store - all with no ads
This highlights a shift in how businesses get started and compete
One of the biggest YouTubers just opened a burger chain in the US. I know most won’t think much of it, but it highlights a very important change that’s happening in retail and commerce.
Let me explain.
When most businesses begin, they will look to create fans and gain customers. It usually starts with their network of people they know, and will grow through advertising, publications and word-of-mouth.
More recently, early DTC (direct-to-consumer) businesses were able to do this on a large scale by taking advantage of up-to-date social media marketing and its cost-efficient advertising costs.
The “typical” approach has been to Create the business, then build the audience.
As I mentioned in a previous blog I wrote, however, commerce and communication are increasingly merging.
What do I mean by that?
Traditionally in business, we have the “commerce” aspect on one end (ex: shop, restaurant, online store, etc.), and the “communication” aspect of it in order to gain awareness and get customers (ex: magazine ads, TV commercials, social media posts, etc.) on the other.
The two are increasingly blending together.
It’s why social networks are growing their eCommerce and live commerce (selling via livestream, something China is way ahead in) functionalities, and retail brands like Red Bull have created their own media production companies.
But why is an influencer like MrBeast launching a business worth paying attention to?
First, about MrBeast and what he did:
Real name Jimmy Donaldson, born in 1998
48.5 million YouTube subscribers (more than many corporate publications)
2nd biggest YouTube earner in 2020 (USD $24M)
Known for expensive stunts and philanthropy (but not food)
He opened up a brand new 300-location burger chain across the US together with Virtual Dining Concepts
This launch shines a light on this important change in retail and commerce:
The “new” approach is becoming have the audience first, then build the business.
Social media has allowed individual people to build a network of this type of scale.
And imagine already being able to get insights on millions of people in your network before you even open up shop. You’d get a better sense of product variety, location, pricing - a lot.
With all variables the same, the influencer can beat the businessman at launching the same business because they already have a large network that cares about who they are and what they do.
Celebrities and athletes have had endorsements and launched businesses based on that concept for a long time now as well, but the difference is rather than only being able to connect with them via channels like TV or magazines, fans are connected with influencers on multiple channels every day through a device they always carry and are always looking at. And there’s no corporation or label standing in between.
This is why celebrities like Will Smith have worked to become social media influencers. It’s begun here in Japan as well.
Someone like MrBeast can simply announce he’s opening up a business and have cars lined up for miles.
Not to mention, his app shot up to #1 in the US, and many other people and media publications are talking about what he’s done. All with no money spent on paid advertising.
The traditional businessperson opening up a burger restaurant can’t do this.
What’s even better about his business is that it’s completely direct-to-consumer.
Through Virtual Dining Concepts, a company that provides turnkey solutions to operating virtual restaurants, he’s using cloud/dark/ghost kitchens - rented industrial kitchen spaces - that makes it easy to relocate when needed, has virtually no retail footprint, and has the food delivered in minutes via food delivery services all while getting consumer data and credit card registrations via the app.
Influencers of all sizes will continue to get into more and more retail and commerce spaces.
There’s potential to get more money than just that from ad revenue as well as an opportunity to achieve their goals. In MrBeast’s case, a portion of each sale goes to food relief charities in the US.
This is why businesses now need to be competent at modern communication.
Let’s be honest. Most businesses aren’t novel with cutting edge products and services that people feel they can’t do without, and most don’t have deep enough pockets to keep running ads in order to maintain purchase numbers, all while not losing marketshare to a better communicating competitor.
This is why the modern communication aspect is huge - it builds reputation.
If there’s one lesson to take away from this:
Businesses are in the communications and media space now at a deeper level than just being an advertiser. They have to be - their next competitor might already have a much larger and more passionate fan base before their business even opens.
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A Juice Brand Meant to Help Farmers in Japan
Tasting The Fruits Company, a Japanese DTC brand aiming to turn wasted fruits into 100% fruit juice.
This small juice brand crowdfunded on Japanese crowdfunding site Makuake
They make 100% fresh juice made from wasted fruit
It’s a DTC brand started and operated by a Gen-Z team
I love Japanese fruits - they’re beautiful, well taken care of, and sweet beyond words.
Unfortunately, a lot of it goes to waste, largely due to the Japanese consumer market’s high demand for visual perfection.
While many are trying to change this, I found out about a small company looking to make fresh juice out of these wasted fruits.
The Fruits Company was started by a young Gen-Z team looking to help farmers who face a large portion of their crop being unsellable as well as tackle a little bit of the food loss problem.
Things like purpose-driven brands, CSR (corporate social responsibility), or SDGs (sustainable development goals) are still relatively new concepts in Japan. This isn’t to say companies are bad, they just haven’t buzzed in culture in the same way they have in other markets.
The Fruits Company ran a crowdfunding campaign on Japanese crowdfunding site Makuake, and blew past their goal rather quickly.
It’s a DTC brand, or direct-to-consumer, and they mainly sell online via their Shopify eCommerce site. They’ve also been doing a lot of pop-ups and in-store collaborations with various cafes and coffee shops.
Their grape juice, which I tried, was made with Japanese Kyoho grapes. If you saw my guide on Koshu, Yamanashi, the grape capital of Japan, you may know about them.
The juice was really good and incredibly sweet, and I’ve grown to like it the more I drink it. I’m not really a fan of artificially flavored grape juice, but this one tastes like the real fruit.
It comes in a 500ml glass bottle and is 100% real fruit juice. Only Vitamin C is occasionally added to help with the color.
I recently talked with one of co-founders, Ryohei Tokunaga, and you can see him speak about their company, what they want to do, and about his perspective on Japanese Gen-Z consumers in this video.
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Fall in Japan Wallpapers
Fall is arguably Japan’s best season. Some of my favorite photos turned into wallpapers for your phone.
Fall is Japan's best season. To me at least. It’s when the weather finally begins to cool down from excruciating summers and the leaves turn beautiful colors.
I've been fortunate to see them for several years now, so I edited some of the photos I took into wallpapers for you. Feel free to use them!
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Instagram in Japan in 2020
All about Instagram use in Japan in 2020. Information from the House of Instagram Japan online event held by Facebook Japan.
House of Instagram Japan was held in online on November 26, 2020
Instagram has over 33 million monthly active users in Japan
Users in Japan in particular use Instagram for search
Instagram remains one of the most significant social networks in the world and continues to be huge in Japan.
On November 26, 2020, Facebook Japan held their House of Instagram Japan, or インスタハウス in Japanese, online seminar event, going over the latest usage statistics and behaviors on the platform.
Globally, Instagram has 1 billion monthly active users, now 10 years after it first launched. It’s been a pretty big part of my daily life since I signed up in May 2011.
Anyways, here are some interesting facts about Instagram in Japan.
The Japan market
The Japanese market is said to have more than 33 million monthly active users. This number hasn’t been updated in a while as this was the same number announced last year at Instagram Day Tokyo 2019, so we can only speculate as to why.
Japan is an important and unique market for Instagram, Facebook Japan CEO Masahiro Amizawa said. In fact, Japan holds their only development team outside of the United States.
In addition to browsing and discovery, users in Japan use Instagram for search purposes more than users in other markets. Compared to the global Instagram user average, users in Japan search via hashtags 5X more.
This makes Japanese hashtag strategy very important for brands.
Another point of difference in Japanese usage is that Instagram users in Japan seek shopping information more.
Utilizing functions such as Instagram’s shopping tags, users in Japan are 3X more likely to look at product details compared to users in other countries.
Not utilizing shopping tags or having them link to a non-Japanese eCommerce site is a wasted opportunity.
It’s also worth noting that advertising to Japan from a global account isn’t enough. 42% of users who become interested in a brand will visit the brand’s profile in search of more information.
I’ve seen many international brands in particular advertise in Japanese but from a single, global account, with all the posts written in a foreign language.
The truth is that English capability in Japan is notoriously low, and the type of social media content that they like is often very different. This potentially cuts off the interest cultivation in the Japanese user.
Japan-first Developments
Three functions that began in Japan were highlighted, developed due to behavior in the market.
Account QR codes
This has been around for quite some time now, but it allows users to quickly connect to other people and businesses. Japanese were used to scanning QR codes from before, and you’ll likely see them around if you’re in the country.
Event tagging in in-feed posts
It looks similar to shopping tags where you tap a post and information comes up. In addition to products, event information can also be tagged inside of in-feed posts. This let users set reminders to be notified 15 minutes before its start.
It was tied to high usage of the Instagram Live function after COVID-19/Coronavirus began to spread.
Seasonal topics
A list of 10 hashtags around topics beginning to trend are curated. This is due to Japanese users’ searches by hashtags being 5X the global average, their cultural affinity for the seasons and trends that occur in them, and their strong desire to know what’s currently happening.
If you need help with Instagram or Instagram in Japan, send me an email and I’ll see if I can be of help!
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Japanese Health Checks with Socialized Health Insurance
Annual health checks are done each year when working in Japan, a country with socialized health insurance. Here's what it’s like.
Since I began working in Japan, I’ve been required to get annual health checks. I decided to give a glimpse into them, but first I’ll briefly explain what the health insurance is like in Japan.
Socialized Health Insurance
Japan is a country with socialized health insurance, something that seems very much in debate back home in the US.
There are basically 2 types of health insurance in Japan: Japanese National Health Insurance and Japanese Health Insurance.
The former is for everyone, mainly aimed at unemployed, students, etc., and the latter is through an employer. They’re more or less the same thing, just some details are different as well as who does the paperwork.
I work at a company so mine is the latter.
Tax for the socialized health insurance isn’t that much.
A lot of the debate in the US is how much of people’s incomes will be taxed. I came across this anti-socialized health insurance person’s tweet:
😆When you have 46% of your income taken to pay for socialized medicine, don't bitch. Remember this. https://t.co/LxWLvAUL9q
— HipCheck Granny (@HipCheckGranny) November 8, 2020
I thought, that’s not right because I’m not taxed that much.
Of course each country’s system is different, but of the roughly 37% that gets taken out of my monthly paycheck, only about 5% is going to the socialized health insurance.
How much are copayments?
The health insurance covers 70%. When you reach a certain age, that goes up to 90%.
Luckily, I haven’t had any serious incidents or procedures. For visits to internal medicine doctors or dermatologists, I don’t think I’ve ever had a copayment of more than USD $20.
My most recent use was for a dental visit, which is part of the same insurance.
I found a US-educated, fluent English speaking practice in Tokyo and decided to go. This was my first visit:
First-time fee
3 x-rays (left, right, panorama)
Cleaning
= 4,290 JPY (~ USD $41.04)
But then I had a cavity and went back for a filling. The insurance won’t cover any ceramic filling, but it covers white composite.
Local anesthesia
White composite filling
= 2,470 JPY (~ USD $23.63)
Quite a good deal, in my opinion.
Health check
Before going into the health check, we’re required to complete a form. It’s a scantron of questions. Most of them are basic, but there are questions that I found strange the first time, like, “Do you eat faster than those around you?” and “Do you walk faster or slower than people your age?”.
We usually do the urine test at the clinic, however this year we were told to fill up a tube and bring it in.
The health checks I’ve been to are done in somewhat of an assembly-line type of fashion where we’re called in and out of different rooms, each doing a different check.
Checks done during the health test
Eye exam
Hearing test
Height, weight, waist measurements
Chest x-ray
Blood test
EKG test (I think)
Final doctor consultation w/ stethoscope check
Watch my video to see more.
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Social Media Marketing Lessons From Presidential Campaigns
A Presidential candidate's social media campaigns can provide good lessons for people looking to promote their business or themselves on social media.
2020 - It’s a Presidential election year in the US. While the Coronavirus has undoubtably caused some changes in the way candidates have run, for a brand advertiser or marketer, I believe there’s a lot to learn from the way they conduct themselves on social media.
Why are a presidential candidate’s social media campaigns good to study?
Because they need to build massive awareness
They need to bring people through the funnel so they convert - aka vote for them
They have a limited time frame
They are directly battling a competitor
That’s pretty similar to most businesses.
It wasn’t really until Barack Obama’s 2008 Presidential campaign that a candidate actually tried to connect and communicate with younger voters. Until then, it was all about TV and other traditional forms of advertising. Maybe a website at best.
Fast forward to 2020 and the battleground is very different. Social media and modern communication channels have come to play a huge role. So…
How do politicians utilize social media to promote themselves, and what can we learn from them?
You’ll see there are two large, overarching themes: They’re fast and they’re detailed.
This post isn’t meant to be about the actual politics or a debate about the effects of a two-party system or Electoral College. In this case, I took a look at Joe Biden since he’s the competitor.
1. They dive into who they are and what they’re about.
People like brands for different reasons, whether it’s a corporate one or personal one.
These Joe Biden ads showcase different sides of him, what he’s for and against, and what he’s done. They are then run against target audiences that have a high chance of having the same interests, beliefs and concerns.
There is no one message that fits all. These ads reflect that and take advantage of social media’s ability to craft multiple ads for multiple, detailed targets.
2. They’re contextualized to the audience
These ads may look the same at first glance, but they’re actually speaking to people of different states.
Because we can target ads by location (even more specific than entire states), we can “speak” in more specific terms.
There’s a better chance that someone in Michigan will feel that the ad is for them if it’s addressing Michigan specifically, rather than the entire US.
Even though people live in the same location, however, they may be of different backgrounds and cultures, and may speak a different language altogether.
The US may be thought of as an English-speaking country, but around 41 million Americans speak Spanish at home (~13% of the population) and 58 million are native speakers. This means that getting their vote is very important, so Joe Biden and other politicians will run Spanish-language ads that feature people that resonate with the target.
Things get even more diverse when looking at what the most spoken language is in each state after English and Spanish:
Some candidates will even run ads to these targets as well. Bernie Sanders apparently did so in Korean.
3. They aggressively A/B test
One benefit that social media ads allow for is the ability to A/B test. Aggressively.
Most of us are used to gathering our marketing teams and coming up with one or two creatives that we think are on-brand and have a high chance of being effective. This had to be done when running a print or TV ad.
The problem is it’s a completely subjective opinion of a handful of people at best.
Advertising on social media technically allows us to test as many creatives as we want, as much copy as we want, to as many people as we want, for as long as we want.
The Joe Biden ads above are testing various ad copy against the same creative. The ads below are testing both different ad copy and ad creatives along a similar message.
Another thing noticeable when looking through the ad campaigns is how fast they happen.
The ads aren’t just run for 30 days and then reviewed at a performance meeting. Multiple ad campaigns are launched every day, then adjusted or stopped after a couple of days. The speed is incredible.
Speaking of speed, this applies to organic social media as well.
4. They’re relevant to the current conversation
Pitch in $5 to help this campaign fly. https://t.co/CqHAId0j8t pic.twitter.com/NbkPl0a8HV
— Joe Biden (@JoeBiden) October 8, 2020
October 8th was the Vice Presidential debate between Mike Pence and Kamala Harris. A fly happened to land on Mike Pence’s head for a couple minutes, and it quickly became the trending conversation online.
Almost instantly, Joe Biden’s Twitter account tweeted a picture of him holding a fly swatter with a call to action using copy that creatively plays on the word “fly”.
That tweet earned him over 216k retweets, 57k quoted retweets, and more than 910k likes.
Then, within 41 minutes, the Joe Biden team tweeted this fly swatter centric graphic, leading users to an eCommerce shop page selling these branded fly swatters to raise money.
Swats away flies and lies. Get yours today: https://t.co/ehsECKfDPO pic.twitter.com/oVLHHmq85c
— Team Joe (Text JOE to 30330) (@TeamJoe) October 8, 2020
This attention to realtime online conversations and the speed to react, plan and put something out immediately is incredible. It goes to show we’re past the generation of careful planning and week-long designing.
5. They’re authentic
It’s good to remind the audience that you’re just a part of the community. It humanizes and it increases believability.
In this case, Joe Biden rides the #NationalDessertDay topic, and shares some of the desserts he’s enjoyed while campaigning.
The fact is, people don’t only want to hear about your company, what you’re selling and your promotions. With social media putting both people and businesses in similar-looking profiles that share content into the same feeds, businesses need to be a part of the conversation.
6. They build audiences in other channels
One issue many marketing on social media have is that they don’t connect it to any other channel. Even within social media, they’ll rely on one main channel.
Being reliant on one channel is a big risk.
Here, Joe Biden’s ads are asking people to join other channels. In this case, probably SMS (text message) and email. This allows for communication to happen in other channels, as well as for them to keep a connection should that person change or delete an account, or the channel loses popularity altogether.
It’s worth noting that in the middle ad, they are asking users to complete a short survey.
Many companies like to present an image that they know what they’re doing, but directly asking the target audience helps gain insights and shows that you care about how they feel. Also, being that it’s only 2 questions, it immediately tells users it’s short, therefore lowering the participation barrier.
7. They utilize influencers
Influencer marketing is, at its core, word of mouth. It’s getting someone recognizable that has a following to say something good about your business or product.
In this case, Joe Biden uses video speeches posted by Star Trek actors and turns them into ads. We can assume that these ads were run against Star Trek fans.
8. They go where the target wants to be
Back in President Obama’s first Presidential run in 2008, the idea of going where the target wants to be came into play. It was social media.
In 2020, if a candidate or consumer-facing business doesn’t purposefully do social media, they’re probably losing relevance and giving competitors a chance to steal their fans.
eSports and gaming continues to become a huge pillar in entertainment today. This means attention lives here, which means a chance to connect with people.
This isn’t what Joe Biden did, but US Representative Alexandria Ocasio-Cortez, also known as AOC, collaborated with streamers Pokimane, HasanAbi, and several others on October 20th to livestream her playing a game on Twitch.
Anyone want to play Among Us with me on Twitch to get out the vote? (I’ve never played but it looks like a lot of fun)
— Alexandria Ocasio-Cortez (@AOC) October 19, 2020
You can watch highlights here, but the stream peaked at 435k viewers and became one of the biggest streams ever.
AOC, a digital native, probably should be analyzed in a separate post due to her prolific usage of social media that earns her higher engagement rates than any other major US politician. Her testing of Twitch though, is a look at how businesses should go where the people pay attention and actually want to be.
In conclusion, whether it’s a business or a personal brand, connecting with and building a relationship with the end user is key. That often happens by going where they are and being relevant at all times.
Analyzing how political candidates do it is a good way to learn.
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Life in Tokyo as of October 2020
Life in Tokyo in as it tries to get things moving again and edge towards “reopening”. Virus cases, mask wearing, travel, business, and overall people sentiment.
Tokyo has been trying to move towards opening up more and more
Cases have been steady recently, and business is going on relatively normally
The Japan government is encouraging domestic travel
It’s October 2020 and over the past several months, life in Tokyo, as with many places around the world, has been one dealing with trying to function amidst a pandemic.
Tokyo has had about 2 waves - One in spring where it implemented a semi-lockdown, and a bigger one in summer that saw no hard prevention measures taken.
Things have been edging towards returning to something more normal.
This is what I’ve been seeing living in Tokyo. I’ll briefly talk about cases, mask wearing, travel, business, and overall people sentiment.
CASES IN TOKYO
Recently, there have been between 100-300 new cases each day, on average. There's no mass testing that was ever implemented, but there haven’t been any reports of dire situations either.
In fact, in a report by the government’s Ministry of Health, Labor and Welfare, 18,000 fewer people died this year until July when compared to 2019. This is different from the trend over the last decade where the number of deaths have steadily increased.
When looking at cause of death, the cause that dropped the most was due to respiratory illnesses.
This seems to be quite different from back in the US and a lot of other countries for some reason.
MASK-WEARING
Mask-wearing has been a debate for quite some time now, primarily in the West, but it never really was in Japan.
That is, aside from a crazy guy who ran for governor, tried to hold a “cluster festival”, and got a group to ride the train mask-less to make trouble while claiming COVID-19 is just a cold.
Wearing masks was already a cultural norm in Japan for reasons ranging from protecting others or against colds to protecting against hay fever to covering a zit.
People don’t want to wear them all the time, however, but there is a pandemic going on so the majority will. Most wear a typical, surgical mask as they did before, rather than KN-95s or ones with vents.
According to a survey, 83.6% of people say they wear masks during close-range conversations with others. The same survey also found out that 87% of people wash their hands after returning home.
It’s not perfect, but it shows that people are generally mindful about the virus.
TRAVEL
International travel has more or less come to a halt, aside from certain exceptions. Because of that, Tokyo’s streets are basically tourist-free… which is really nice!
Over the past several years, Japan started to boom as a major tourist destination, so businesses catering to travelers have really taken a hit.
To help with this, the Japanese government is incentivizing domestic travel.
GO TO TRAVEL CAMPAIGN
The Go To Travel campaign is a Japanese government campaign that encourages residents to travel domestically.
They’ve allocated over USD $12B+ to give people up to 50% off airfare, train tickets, hotel reservations, etc.
To get the maximum discount, you have to book through pre-decided agencies, but we can still get a decent discount by designing our own trips and booking directly.
Tokyo - as a destination and its residents - was initially left out due to having the high number of cases. As of October, it’s been included.
Personally, I take it as a sign to explore the country that I’m in a little bit more.
Following the Go To Travel campaign, there will be similar campaigns for eating out, events and shopping. We’ll see what happens.
BUSINESS
Many businesses have undoubtably taken a hit. While eCommerce and delivery usage has increased, it won’t offset the losses at brick-and-mortars, which is huge in a city like Tokyo with so much people traffic.
Despite this, I personally haven’t seen many visible changes… yet.
I’ve seen videos in the US and even Seoul where a lot of shops have closed down and are now empty. Recently, I’ve gone out in Tokyo to places like Shinjuku, Shibuya, Aoyama, Omotesando, Harajuku and Ginza, and haven’t seen mass closures.
Although I’ve heard that companies here are facing the hardest time they’ve ever had, there haven’t been mass layoffs yet either.
Furthermore, retail clients of ours at work have maintained their online ad budgets or even increased them. Some are understandable due to what they sell, but others such as a mid-range watch brand, are a little unexpected.
Could we be in a bubble? Maybe this year’s impact will be seen in next year’s and the following years’ budgets and news. I’m thinking probably.
PEOPLE SENTIMENT
Tokyo’s streets have been filling up slowly over the past several weeks.
This could be due to a variety of reasons; people growing accustomed to living in a world with the virus, offices asking for more face-to-face time, shopping due to the season changing, a lack of a major spike similar to the US and other countries, most people acting responsibly, simply being tired of being at home, etc.
It’s not fully back to normal, and people are still refraining at some level, but there has been an uptick since the summer.
If you’d like to see more, please watch the video I made.
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The Japanese Versions of Hawaii Snacks
There are many Japanese-influenced snacks in Hawaii. Here are the Japanese versions of them and their histories.
Hawaii and Japan are tied culturally due to the mass immigration of Japanese pre-World War II. It’s still close today. For Japanese, Hawaii is considered a top travel destination and many locals in Hawaii also enjoy visiting Japan.
It should be of no surprise that some foods and snacks have ties to Japan as well. Here are a few.
Tomoe Ame (Bontan Ame)
Tomoe Ame is a brand of “bontan ame” is a candy found in crack seed and drug stores in Hawaii. They may appear in Japanese shops on the US mainland as well.
It’s soft, chewy, slightly fruity candy wrapped in rice paper. It’s fun for kids because they put a sticker inside the box. It’s made in Nagoya, Japan and is imported but I haven’t seen the brand or box being sold in Japan.
In Japan, it’s more commonly known simply as Bontan Ame, and tastes almost exactly the same as the one in Hawaii.
It originated in Kagoshima and was derived from a mochi-like snack from nearby Kumamoto. The candy was created by adding bontan, or a Pomelo citrus fruit.
Found at: Daiso
Price: ~100 JPY (1 box)
https://www.seikafoods.jp [J]
Butter mochi
Butter mochi is actually a local, Hawaii snack and was not imported from Japan. However, it does use Japanese ingredients and it’s reasonable to say that there’s at least some influence.
Japanese butter mochi is very different. While the Hawaii version is a dense, caky, dessert treat, butter mochi in Japan resembles typical mochi more.
Butter mochi in Japan originated in Akita, and is a simple, delicious, butter-flavored soft mochi snack.
Found at: Supermarkets
Price: ~180 JPY (1 pc)
Hawaii version recipe: https://kirbiecravings.com
Chi chi dango
Chichi dango is one of the more well known Japanese snacks in Hawaii. It’s a soft, sticky mochi that’s often made with mochiko powder, coconut milk and so on.
The truth is, chichi dango is not well known in Japan.
Chichi dango originated in a small city called Shōbara-shi (庄原市) in Hiroshima prefecture. In 1900, a national dairy farm was established in the area and got big. The founder of Izumi Kouwadou, a nearby shop, wanted to make a nutritious snack with the milk, and that’s how his shop became the origin of chichi dango, selling it in 1934.
The ingredients differ from the common recipes found in Hawaii. They use no water or coconut milk. It’s simply mochiko powder in milk, sugar, glucose syrup and honey.
Food coloring also isn’t used for the pink and green colors. The pink is made from rosé wine from Miyoshi-shi, a city next to the Shōbara-shi area. The green is made from yomogi, a sagebrush.
While it may be known in the eastern parts of Hiroshima prefecture, it’s not known throughout Japan.
Found at: Online, shops in Hiroshima
http://chichidango.co.jp [J]
Price: ~ 810 JPY (15 pc.)
Habutae mochi
Habutae mochi is similar to chichi dango. The reason why I’m adding this in is because it’s more well known in Japan than chichi dango.
It’s made in many places in the country but originated in Fukui prefecture. It’s called “habutae” in reference to Japanese silk. Fukui prefecture is known for making a lot of textiles, including the silk, and the mochi has a texture that is smooth and silk-like.
Habutae mochi is made from steamed mochi powder, sugar and corn syrup. No milk.
It is very soft, and is somewhat similar to gyuhi, or the mochi-like topping that’s found in frozen yogurt parlors.
Found at: Department stores, supermarkets
Price: ~ 800 JPY (8 pcs)
Li hing mui
Li hing mui is not from Japan, but there is something similar. If you don’t know, li hing mui is dried plums that began being imported from China in the early 1900s.
Probably the most common snack condiment in Hawaii, li hing mui can be found everywhere. If not in seed form, it’s used as a powder or syrup on anything from gummies and Sour Patch Kids to apples and pineapples, popcorn and shave ice to margaritas and desserts.
It is an acquired taste, however, as it’s very salty.
In Japan, dried, salty plums are most common in Okinawa. These were from Gifu prefecture though, and they were a lot saltier. They also had a sakura-like flower, which is different from Hawaii’s, which are either red or grey.
Found at: Convenience stores, Japanese ingredient shops
Price: ~200-500 JPY (1 pkg)
http://www.plumnature.com [J]
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How Coffee and Cafe Brands are Marketing in Japan
Japanese consumers and coffee, as well as an analysis of a few popular coffee and cafe businesses in Japan to see how they’re marketing and building their brands.
Coffee and cafes play a big part in many people’s lives in Japan, and it’s been that way for a long time. In fact, it was Japan’s kissaten coffee culture that inspired Blue Bottle Coffee founder James Freeman.
Looking around Japan, like many other countries, there seems to be a lot of coffee shops popping up. The truth is however, that the number has actually been decreasing over the past decade according to the Japanese government’s Ministry of Health, Labor and Welfare.
Despite this and other changes in the market over the past several years, Japanese consumers are spending more on coffee than ever.
This is led by the under-30 year old demographic.
Prices at chains such as Starbucks and Ueshima have gone up, but that’s not the only reason for the increase in spending.
The majority of coffee, 6.54 cups per week, is actually not consumed at these chains but rather in the home.
Even though the number of coffee shops have decreased and consumers in Japan are spending more than ever, there is another battleground that wasn’t as big before: The digital space.
Coffee is a commodity, which means branding and marketing are more important than ever.
Yes, the beans, the drinks, the locations, the prices, online availability - these all matter and contribute to the success of a coffee or cafe business.
If we take a look at the coffee and cafe-related brands growing and succeeding, they have the same thing in common: Purposeful branding and marketing.
This goes beyond having a cool name and running Facebook Ads.
It’s a mix of tactical implementations that help build a relationship with potential customers and gain their trust - something of utmost importance when it comes to selling anything to Japanese consumers.
Together with my colleague Takumi Kishimoto, we compiled a brief that takes a look at the latest information around coffee and cafes in the Japan market, and then dove into what a few successful ones are doing marketing-wise to help them grow.
If you or someone you know is looking to grow their coffee or tea brand, cafe, restaurant or eatery in Japan, this might be interesting.
You can find the download link on our agency post here, or feel free to contact me and I can send it over to you.
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Creating Brand Value for Social Commerce
Commerce and communication have merged as social networks become direct eCommerce channels. Here’s how businesses should think about social media now.
As e-commerce plays an increasing role in how people make purchases, communication in the digital space becomes ever more paramount. Research shows that once someone experiences buying a packaged good online, they’ll continue doing so.
Here in Japan, 31.6% of consumers said they increased e-commerce use between March and May 2020, and 55.6% feel that they will continue doing so going forward.
As direct-to-consumer brands become the standard for shoppers, businesses face the urgent need to fine-tune the communications that incentivize those conversions. I’ll discuss social media realities and how brands can approach value creation there.
Commerce and communication have merged.
Entire customer journeys to purchase are happening within the smartphone. Social networks have been thought of as purely communication channels but are increasingly being used to sell directly.
Facebook Shops and Instagram Shops link with e-commerce platforms like Shopify, BigCommerce and others. In Japan, they also work with the popular Stores.jp and Base. Social networks like TikTok, Snapchat and LINE have also dabbled in the e-commerce space.
Purchases made completely within social networks will eventually become a new norm, and forcing someone to visit a website, app, or store to make a purchase will act as barriers, especially as more competitors stop requiring people to do so.
Getting social media right is now a do-or-die situation, but many struggle with the fundamentals.
Big challenges for businesses: Categorization, Depth vs. Width, and Supply & Demand
The challenge of categorization
Most businesses have an advertiser relationship with media, and treat social media the same way.
Social media fundamentally changed the advertiser-publisher-consumer dynamic.
Any individual can post social media which means more content from more publishers than ever is being put out and consumed. This means more fragmented attention, making it harder for single ads to have the impact they used to in the pre-social media era.
Because people intend to consume content when they use social networks and are accustomed to the accounts they follow putting out interesting content, businesses should actually be categorizing themselves as publishers on social media.
The challenge of depth vs. width
Many want fans and a huge audience, but in reality, only a few successfully accomplish both equally.
Generally speaking, prioritizing reaching a large audience comes at the expense of creating relationship depth with a specific target, and vice versa. Most brands will find themselves on either side of the light blue line in the chart below to varying degrees.
Because major social media channels are mature with a lot of competition, the current trend is to lean towards the side of depth, focusing on micro-communities. This leads to the next challenge.
The challenge of supply & demand
Social networks are like stocks or real estate in the sense that investing in it early can help produce bigger results.
As a platform grows so does competition. This means standing out and providing unique value to users becomes more difficult. More resources - whether it’s in strategy, creative or production - are often required because you’re competing against similar brands that have similar products that put out similar content. There’s also more advertiser money being put in.
We can see supply and demand issues come into play when social media marketing tactics produce lackluster results.
Pretty pictures have become expected, influencers featuring products in their posts are now an everyday thing. Giveaway campaigns request user actions such as follows for a 0.001% chance of winning something from a brand they don’t have a relationship with and for a product not in purchase consideration.
We know people follow, become fans and consider purchasing because they’re being provided value of some sort. So how can value be provided on social media now that communication and commerce have merged?
Provide experiences on social that are more human.
Social commerce is about straying away from a transactions-based approach and providing people with more “human” experiences online. It’s more marketing and storytelling than advertising and clicks.
In a market where barriers to entry have decreased and commoditization is rampant, the human truth is the biggest differentiator.
The goal should be to bring a neighborhood mom-and-pop shop experience to a social media space that’s been overrun with big box retailer and superstore dynamics.
Be authentic and connect
That’s another way of saying be real and be a part of the community. One of the main reasons we support small businesses is because of its human aspect - the people, the story, the connection to the neighborhood.
In fact, 77% of consumers in a survey said that they sometimes purchase products or services solely because they believe in the brand’s values/reputation and want to support them.
Instead of only relying on a product’s features to differentiate, brands should dive into the who, what, where, when, why and how’s of their business. Then with a publisher’s approach, connect through content around those areas that may interest or benefit their specific target on that particular platform.
Allowing the target to virtually experience different aspects of the business lets them learn about how it relates to them. This grows community, builds trust and increases purchase intent.
Scale in-store interactions
When someone asks a question or makes a comment in a store, it’s expected that the owner or employee will respond. This needs to happen on social media as well.
There are two big reasons why:
Consumers think of social media as a customer service channel, and it’s also now a point of purchase.
In Japan, younger people surveyed said they prefer connecting via email (30.8%) and social media (26.4%) over phone (22.6%) and in-person (21%), so this is a primary communication touchpoint for brands. As a window into the near future, 32.2% of teens in the survey favored social media.
It provides free consumer insight into what works and what doesn’t, what people want to know about and what they’re tired of hearing and seeing.
These interactions makes the business more accessible, and with e-commerce capability built in, the consumer can seamlessly make a purchase.
Give added value
As a business enables these human experiences to happen through their social account, the ability to recognize bigger fans and customers increases.
This opens up the opportunity to strengthen the relationship with them even further. This is when businesses can provide added value. This can come in the form of coupon codes, exclusive experiences, early access, gifting and more.
Giveaway campaigns also tend to work better here since it’s targeted to followers who have some context and relationship with the brand.
Choosing fans to surprise and delight can also lead to positive reactions and increased word-of-mouth.
This message from J. Crew's CEO, for example, is thanking the customer for choosing to shop with them when there are so many options available. It's worth noting that this wasn't included with a purchase and isn’t a coupon to entice future spending- it is purely a gift.
In pre-social media days, businesses started with a product and then built an audience. Now, more and more businesses are starting with the audience first, then releasing a product after.
We can see this trend coming to play when we look at artists, celebrities and influencers increasingly launching their own brands.
As commerce increasingly shifts to various online communication channels, it is of utmost importance for businesses to focus on audience, and social media.
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Making Sukiyaki with Real Wagyu
Making Kansai-style sukiyaki, different from typical sukiyaki, with delicious Japanese Wagyu beef.
Japanese Wagyu beef needs no introduction to anyone who has been lucky enough to have a taste of the real thing. It is perhaps the best beef around.
So when we were gifted a box of sliced Wagyu from Ningyocho Imahan, a highly rated restaurant/butcher in the Ningyocho area of Tokyo [MAP], we knew we had to put it to good use.
Kansai-style Sukiyaki
We decided to make Kansai-style sukiyaki, slightly different from the more common Kanto-style sukiyaki found in most places in Japan and overseas.
The two styles refer to different areas. The Kanto area consists of Tokyo and surrounding prefectures such as Kanagawa (Yokohama, Kamakura, Hakone), Saitama, Chiba, Ibaraki, Tochigi (Nikko) and Gunma. The Kansai area consists of Osaka, Kyoto, Nara and Hyogo (Kobe).
The main difference in styles is the cooking of the meat.
In the Kanto style, the meat is put in the pot together with the vegetables and other ingredients and simmered before eating.
In the Kansai style, the meat is cooked separately and eaten before the vegetables and other ingredients are put into the pot.
Because we had some good beef and wanted to enjoy some of it on its own, we followed the Kansai style.
Watch the video to see how it’s made.
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Shopping at Costco Japan
Wagyu steaks and bulgogi bakes are just a few of the added benefits for expats who love shopping at Costco in Japan.
Wagyu steaks, bulgogi bakes and fresh fish galore are just a few of the differences at Costco in Japan.
As of 2020, there are 27 Costco warehouses in Japan.
Their business membership is 4,235 JPY a year, their gold star membership is 4,840 JPY a year. You can use your US membership in Japan as well, but apparently a Japanese membership is required for online ordering and delivery.
Costco is one of the beloved shopping destinations for many expats as they sell a lot of items from back home that can be hard to find at normal shops in Japan.
They do, however, have a lot that are only in Japan.
Here are some of my favorites at the Tamakyo Costco location, just west of Tokyo.
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Creating Brand Value in the Direct-to-Consumer Era
Decreased barriers to entry in communication and e-commerce have increased hurdles for brands to differentiate and stand out. This is how they can create value.
Increasing capabilities in digital spaces like social media and e-commerce has been a no-brainer for some time now, but COVID-19 really brought to life a do-or-die sense of urgency to the late majority and laggards.
Here in Japan, businesses have had more cushion due to consumers as a whole being slow to shift away from traditional retail and cities having a lot of foot traffic.
Major e-commerce platforms like Amazon and Rakuten have grown to about 50 million users each (~40% of Japan’s population) and the government’s pseudo-lockdown has given many a first taste of online retail.
The approaches most brands are using, however, are due for tweaking.
The typical funnel is outdated.
Here’s a typical funnel and online ad strategy that consumer-facing brands use.
The approach is not necessarily wrong, but the fact that it’s one-dimensional around product purchases puts the brand at a disadvantage when combating changes in consumer behavior and the market.
The truth is that it’s too vulnerable.
Brands like this tend to prioritize their “in-store purchases” goal due to their brick-and-mortar’s operational costs, but as we’ve all experienced, this conversion point can be completely eliminated due to something like a stay-at-home order.
Rethinking in-store experiences, communicating well on social media, and having a DTC/D2C option are the bare minimums now, but there's still the challenge of standing out and building for the longterm.
It’s becoming increasingly difficult for brands to differentiate and create value in the Direct-To-Consumer era
Why?
Most products are commoditized and not actually needed
Social networks like Instagram are mainstream channels and every competitor now has the same communication tools
E-commerce platforms like Shopify lower barriers to entry for retail which results in more competition and usage of the same tech stack
A leveled playing field means that more needs to be done in order to stand out.
Depending on a good product and having that be the only value given to customers is risky.
It can be challenged by competitors with bigger resources or data pools (see how brands can use an offline competitor’s data against them here), revenue can be completely stopped if one variable changes, and the linear, point-A to point-B customer experience doesn’t connect beyond purchase.
This leads to short-term, increasingly unsustainable behaviors like only trying to acquire new customers to convert. So what should brands do?
Explore other growth areas and connect them
Brands should consider what other related areas they can get into that provides their customers value. From there, they can rethink the strategies and funnels in each area instead of having them be used as acquisition channels centered around one conversion point.
Here’s an example of a multi-dimensional brand:
In this example, the brand is operating in 4 areas - media, products, events and subscriptions.
Let’s say it’s a cookware brand.
They may be regularly creating documentaries and how-to videos, manufacturing their cookware, hosting events featuring influential chefs that were in their videos, and selling monthly recipe packages from these chefs via subscription.
Within these areas, there may be various approaches.
Media may have some content behind a paywall, products can be sold via website or SMS, events can range from factory tours to wine-and-dine, subscriptions can be geared to families or college singles, and so on.
The areas are connected through a Gamification strategy
Customer actions are incentivized through positive reinforcement. Yu-kai Chou’s Octalysis shows us that this “leveling up” of customers can be done by implementing human-focused design, based on the drivers of human behavior such as ownership, empowerment and accomplishment.
The strategy is designed by an Objective Laddering and Value Shift framework.
By analyzing target customer behaviors, their true, often subconsciously held objectives that drive their decisions can be found. From there, the best brand actions can be planned by relating them to those objectives, increasing the chances of the customer choosing to move through the various areas of the brand.
Simply put, we can use the example of a simple store point card system and combine it with Pokémon Go’s ability to incentivize different actions by empowering customers with a sense of control over their desired outcome.
Because the brand now has multiple funnels, that outcome isn’t one-dimensionally related to product purchase, making the brand relevant to the customer in multiple ways.
Key benefits of this approach are:
Production of multiple revenue streams
Differentiation against competitors and value creation
Extended customer lifecycle
In an era that’s seeing online and offline merge more and more, one that is more consumer-centric than ever, creative strategies need to be explored in order to stand out and be of value to the consumer.
While there’s much to be done on the business side as discussed, we’re also in a time where social media influencers and personalities are leveraging the value they’ve created for their large audiences and launching competing retail brands themselves.
This means that retail-first brands now have to compete more than ever on the media side as the communication and commerce worlds merge.
I’ll talk about what I think brands should be doing on the media side next.
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First Day Back in the Tokyo Office After Lockdown
What it’s like to go back to work in Tokyo after the COVID-19 / Coronavirus pseudo-lockdown.
In Tokyo, we had a stay-at-home request issued by the government that lasted for the majority of April and May 2020.
When the emergency declaration was lifted, some companies were quick to bring everyone back (despite few adjustments to the work environment), while others, like my company, are moving towards trying to work out a balance.
I went back to the office for the first time in early June as we are trying to get team members to be in the office at least twice a week.
I made a vlog to show how that first day was.
Returning to office work makes you reconsider its value.
What I realized was that while office work and remote work each have positives and negatives, it depends on the person and tasks at hand.
As a non-native Japanese person who isn’t fluent at Japanese but works primarily with Japanese colleagues, being in the same physical space helps eliminate existing barriers when it comes to understanding meanings or contexts.
It’s also beneficial when working on a team project or if there’s a lot of collaborations happening to get things done.
On the negative side though, it really made me question the need of commuting every day.
Despite it only being about 40 minutes door-to-door for me, the stopping of what I’m doing, getting ready, then commuting twice per day is an interference in production. While I can work on my phone, it’s often not as easy as a laptop.
Tokyo trains also can become very congested, and with the virus still around, it’s a little nerve wracking to be body-to-body in a box with little ventilation.
Working in the office isn’t comfortable as well due to mask-wearing and no new seating arrangements or protective adjustments.
Because of this, I noticed that I drink far less water throughout the day.
How will companies adapt moving forward?
It will be interesting to see how companies continue to adapt. There is a need to due to changes in people’s psychologies and behavior.
People like Andrew Yang have said there’s been 10 years of progress in the last 10 weeks. How much that’s true with regards to Japan is unknown, though.
A survey revealed that in mid-April, a couple weeks after the emergency declaration was made by the Japan government, 64% of small to medium-sized businesses did not move to remote work. [J]
There’s also the issue of Japan as a whole being resistant to let go of traditional work practices - many of which require a physical presence. And of course, there is the workforce that is accustomed to it.
On the flip side, there are companies like Twitter and Shopify saying they will be making efforts to move to 100% remote work.
As of today, Shopify is a digital by default company. We will keep our offices closed until 2021 so that we can rework them for this new reality. And after that, most will permanently work remotely. Office centricity is over.
— Tobi Lutke 🌳🌲🛒🕹 (@tobi) May 21, 2020
While I think that may be a bit farfetched for most, the boldness of the move is admirable.
What companies can’t do is simply go back to exactly how things were. The world has and is changing since this global pandemic.
Let’s see what happens.
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Springtime Walk in Shimotakaido, Tokyo
Exploring the streets of Shimotakaido in Setagaya, Tokyo during cherry blossom season.
The Shimotakaido area of Setagaya, Tokyo, is a smaller, residential area with a few schools in the neighborhood. The main area is lively with a variety of shops and eateries, and its tunnel of cherry blossoms make for a nice walk during the springtime.
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UNIQLO’s Initial Black Lives Matter Statement Highlights Japanese Marketing Struggles
UNIQLO’s initial Black Lives Matter post highlights the struggles Japanese brands sometimes have when marketing to an international audience.
Today, June 3rd, 2020, is a tumultuous time right now in the US as many Americans protest against the systemic racism that has plagued society for hundreds of years.
It's a time for us, at the very least, to listen, learn and reflect.
As an American working at an agency doing marketing in Japan, I’ve become aware of the differences in marketing strategies, brand communication, customer expectations, internal struggles, etc. in Japan versus the US.
UNIQLO recently posted a statement during these protests in which they got heat for. They were able to make up for it nicely, but it does highlight an issue Japanese brands face when marketing internationally.
On average, Americans care a lot more about than just if a product is good, affordable, or from a longstanding brand. In the social media era, where everyone has a camera, production studio and mass media broadcasting capabilities in their hands, people care about transparency.
What is the role you feel your company plays in society? What are its values? Sure, you make a good product but how do you treat your employees?
Research has even shown it to be good for customer loyalty.
64% of consumers who have a relationship with a brand cite “shared values” as the main reason.
77% of consumers say that they at least sometimes purchase products or services from a brand solely because they believe in the brand’s values/reputation and they want to support them. 2 out of 5 young people make purchases based on this regularly.
Because of this, we often see companies in America communicate about their actions and values. When the effects of COVID-19 began to take place, many were quick to communicate about the measures they were taking, even before government decisions to lockdown.
It's the same for Black Lives Matter. Here are some examples.
There are many more examples.
Each of these posts clearly state their values and their positions on the issues. It should also be mentioned that when some have asked if they're making donations, some brands (like Diamond Foundry) have responded to them saying exactly where they're donating.
Now let’s look at UNIQLO’s initial post:
Some of the popular comments:
This is so vague. If you're going to put up a support message, address the community that you intend to support, address them directly because they need the support. Posting an empty message like this is nothing short of following a trend....
U SAID NOTHING.
Fire your PR team. This is a pathetic collection of words at a time when words and action are everything. That's a whole lot of words to say absolutely nothing! Way to use your platform to take zero stance.
Is this the first AI-written PR message? Because it's so non-specific and feels like an imitation. Sorry, but a bunch of vague words in white on a black background isn't it.
When I first read the post, I also stopped and though, "Wait, what did they actually say?"
In the other examples, the brands clearly state their position on a specific matter, even released statements about which organizations they're donating to and what actions they are taking in order to support their position.
UNIQLO didn't initially do this. They did not define who is feeling the pain, what diversity means to them, what specific actions they're taking, etc.
The reluctance to take a firm stand or voice a strong opinion is a common shortcoming of many Japanese companies.
There is a fear of being disliked, especially due to being rooted in a group-oriented society with comparatively low diversity. There’s a lot of trying to stand out without disrupting, and the outcome is often vanilla messaging: “Cute!”, “The most popular!” “Great for everyone!”
That type messaging doesn't work in markets with greater ethnic, religious, sexual and intellectual diversity and individuality.
My guess is that there was probably an internal struggle between the UNIQLO US team and UNIQLO Japan office, and that's why the message became a diluted mess.
UNIQLO, to their credit, managed to respond to the situation quite well.
Here is UNIQLO’s follow-up:
They showed that they’re listening and got specific in explaining what actions they’re taking. So far, the response has been largely positive.
It's a good example for future Japanese brands with foreign aspirations to learn from.
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Living in Japan as a Japanese-American
My experience living in Japan as a Japanese-American, both in the countryside and in the city.
There is no universal experience living in Japan as a foreigner.
A lot of the perspectives being shared out there come from those who are more obviously foreign, but what about the perspectives of Asian foreigners? And in particular, what about those who are Japanese by blood?
I fall into that category.
To give you some context on me, I’m a 4th generation Japanese-American, which means my great-grandparents immigrated to from Japan to the US.
I grew up in Honolulu, Hawaii, which has a lot of Asian influence and a lot of Japanese influence. After high school, I moved around on the US West coast before moving to Japan. I first lived in a small area of Fukuoka prefecture before moving to Tokyo, so I have the experience of both environments.
Japanese, but altered.
One of the things I realized while living in Japan was that what some things that I had known to be Japanese in the US, was sometimes old or not Japanese at all.
Names for example. Many of my Japanese-American friends have Japanese middle names. I found out that a lot of those names are very old, likely because those were the names common during the time that our ancestors immigrated.
Yakudoshi was another. Growing up in Hawaii, I was under the impression that they were special years and people would have Yakudoshi parties. In Japan, I found out that they’re a set of bad luck years and are not to be celebrated. Going to a temple or shrine to pray about it is more common.
American, but…
The degree to which people in Japan can understand and accept you varies from person to person, and more generally, rural and city environments play a factor. People in the cities are more likely to have had some experience with foreigners or traveling abroad.
The different between ethnicity and nationality isn’t one that’s easily understood. Japan, after all, is not all that diverse.
I’ve come across people who easily understood my background and others who could not comprehend it even if their life depended on it.
In general, there is always a “but”, or explanation that needs to happen after saying that I’m American. This can be that I have Japanese blood or that I’m from Hawaii. I don’t really get the simple “Oh ok”as a Caucasian person would after saying they’re American.
Invisible foreigner
I’ve never been stared at (unless I deserved it), never had people fascinated by my hair, never been immediately refused service. This tends to be different from the experience a lot of more obvious foreigners have.
On the other hand, I’ve never been given special treatment for photo ops, never had Japanese people running to talk to me so they can practice conversations, and never got put on camera during English summer camps with foreign teachers when I used to teach.
This ability to blend in better and almost be an invisible foreigner has its advantages and disadvantages.
I made a video talking about my experience living in Japan as a Japanese-American. If you’re interested, please take a look: Living in Japan as a Japanese-American
What apartment-hunting and buying was like in Tokyo, how much apartments cost in the city, and some things that should be considered.