Why not do market research?
“Market research? I don’t know it well…” This is the usual reaction I receive from Japanese when talking with them about market research services. I continue to say: “Well, market research services include online satisfaction surveys…” “Oh, surveys? Uh… I see. Collecting opinions from people, right? We already do it.”
It does not seem that Japanese companies actively use or purchase market research services. For instance, market research sales in China in 2006 increased by 17.8% from the previous year, and in Hong Kong by 12.2%, while the market research sales in Japan increased by only 4.3% in 2006 (Source: ESOMAR Global Market Research 2007).
This can make us wonder: without using market research services, how do Japanese companies understand their customers’ needs and create innovative products?
Here is what I found out from Japanese companies that do not use market research services:
Doing research while selling products/services: Japanese companies collect information about the market, competitors, and their customers as part of sales activities. One Japanese sales consultant said that having a good relationship with distributors and customers is crucial for doing business in Japan, because through this they can get the latest market information from them. He also said that good sales representatives should be excellent listeners so as to understand the needs of their customers in order to offer them the best proposals.
Using own senses to make products: Like artisans who create traditional Japanese art, Japanese engineers are inclined towards using their own senses to develop new products. For example, a cosmetic product development expert creates a skin moisturizer that leaves skin silky smooth by checking the product texture on his own skin. His own senses of feeling, seeing and smelling, not the consumers, are his tools to develop products that delight his consumers.
These findings do not sound like good news for market researchers in Japan. However, they are not just bad news. There seems to be several drawbacks to their approach:
- Customer information is not always shared within the company. Although sales representatives may have a mass of information about their customers, they may keep it only in their heads or in their own journals. Unless the company develops a database for sales activities, such customer information may never be used by other sales people. Each sales representative may have the same customer information but in a different format.
- An excellent design from the expert’s viewpoint may not necessarily be what customers want. “The product looks wonderful, but I don’t need it.” This is what customers say when they see a product that was developed without input from consumers. Additionally, customers today are not necessarily satisfied with the same products that satisfied consumers 30 years ago. This is one of the reasons why traditional companies who continue to manufacture the same products face a decline in their sales and end up bankrupt.
“We cannot rely just on our own senses anymore”, one senior executive of a Japanese manufacturer said. “We have to listen to the voice of our customers.” Yes, indeed. We need to take the voice of customers to top management, not just to sales representatives and product designers.
March 21 2008 09:51 am | Research and Weekly Articles
Angeline Lim on 05 Mar 2010 at 3:34 PM #
I find this article interesting. I’m presently working in various Japanese public schools and I’m finding that the school Education and Education at home has been changing as well. Under a diverse teaching methods by different teachers and parents, young people nowadays are becoming more and more diverse and individualistic. I think the traditional companies are very similar to the traditional Education system. And the teachers are like the sales representatives who keep mass information to themselves or within the schools, and things would be slow to change for another 20 or 30 years.
I would think that in order to understand the consumers, one would need to first understand the Education and background of the consumers.
What do you think?
Regards,
Noriko on 05 Mar 2010 at 4:54 PM #
Thank you for your comments. Great points.
Yes, I agree that understanding “what educations consumers received” is important to understand the consumers. I noticed that Japanese who grew up in the US are more independent than Japanese who received traditional Japanese educations. I still remember that my school teacher did not take any questions in the class when I was in elementary school. She concentrated on keeping the class quiet. I can see such behaviors in the Japanese companies - people want to keep quiet at meetings.
I also notice that young people become more individualistic. However, I do not see they become independent. They still rely on others including media and friends for making decisions, not on their own.