Consumer tastes in Japan are changing and homegrown brands are losing ground to multinational brands, according to an analysis of Asia’s Top 1000 Brands by Campaign Asia-Pacific and Nielsen.

While brands Meiji (ranked third overall), Suntory (5) and Morinaga (6) still dominate and held their positions this year, other local brands such as Nissin (12), isotonic drink Pocari Sweat (37), snack food company Calbee (40) soy sauce maker Kikkoman (48) and beer giant Sapporo (86) all dipped slightly. Coffee retailer Doutor (72) and tomato juice maker Kagome (98) both slipped four spots.

Jam producer Aohata (-12), snacks maker Koikeya (-12), brewer Kirin (-17) and ready-made tea brand Ito-en (-25) had double-digit slips this year.

Many Japanese packaged goods makers like Aohata, Kikkoman and Koikeya are not spending much at all on mass campaigns, especially TV, Reiko Ogata, general manager of the global branding department at Dentsu’s Solution Intelligence Center told Campaign Asia-Pacific.

“Coca Cola, McDonald's and multinationals are the ones that have the most dominant advertising expenditure these days,” added Ogata says. Coke especially has used its position as the official sponsor of the Olympic torch relay to heavily promote its awareness in Japan in the lead-up to the postponement of the Games.

The analysis noted that global food companies also have significant efficiencies of scale, allowing them to sell their goods at a better price point, something that will continue to be top of mind for cost-conscious Japanese consumers in a struggling economy.

Similar findings were found in Kantar’s BrandZ Top 100 Most Valuable Global Brands survey, which saw a decline in the number of Japanese brands making the global list.

Hidehiko Otake, chairman, Japan at Kantar pointed out that in 2006, the year the rankings launched, there were nine Japanese brands, but only three made it to the list in 2019 – suggesting that Japanese corporations have been neglecting investment into their brands.

“Brand worth is increasing around the world, and the total value of the top 100 brands has tripled since 2006. In this climate, Japanese brands that have failed to increase their worth have gradually disappeared from the list; in contrast, many of the world’s top-ranking brands are from the United States and China,” he wrote in an opinion article.

Otake observed that Japanese corporations tend to think that the most important factor to a brand’s value lies in objective measures of function and performance for differentiation. However, to create a strong brand, the most important factor is “meaningfulness” - which is irrational and emotional.

“Consumers want to feel an emotional connection with brands and unfortunately, Japanese corporations often lack management leadership and marketing schemes for generating such 'meaningful difference',” he added. “Japanese corporations still have plenty of opportunities to rebound. I hope that this will happen sooner rather than later.”

Sourced from Campaign Asia-Pacific, Kantar