Trend-conscious young Japanese are moving away from luxury brands to fast fashion brands. Due to the financial downturn even the younger generation is becoming more frugal, I even say more than their parents. While previously high-end brands were a must for status, the younger shoppers are more confident about how they dress, so they are looking for options to be trendy on a lower budget.
According to Kageyama Yuri (AP) some of the newly imported brands are struggling in Japan. Requirement for success in the local market is not only speed and price, but also being in tune with local tastes. Among the imports the U.S. Abercrombie & Fitch Co. is in a challenging situation. Kageyama san pointed out that although the skimpy clad male sales clerks drew initial media attention, the crowds are gone now, partly because some of its clothes are sold at double its U.S. prices. For global brands setting a higher price for Japan had worked in the past, but no longer, because more Japanese check prices online or do shopping directly in the U.S. Further the presented image from Abercrombie & Fitch Co. was outdated considering the local the trend for androgyny in men, which is just the opposite from the macho casual attire being pushed by the seller. Timothy Schepis (fashion expert for businesses setting up in Japan) says: “Japanese consumers’ priorities have changed a lot since the recession. They’ve become more mature shoppers due to the Internet, where they can find the prices of things easily and multiple places to compare.” On the other hand, the reason why spending habits for the younger generation have changed could be much simpler: online entertainment at home takes a bigger share out of the daily things to do, so if you go out less often compare to the past, you need less clothing.
Overall, while I agree that Japanese market is challenging for foreign suppliers to enter, big winners do exist in fast food industry: Krispy Kreme and McDonald’s, but solely so, because they have kept a close eye on the local demands, unlike Dunkin’ Donuts and Wendy’s, who have been forced to leave the market.
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