The Global Economic Crisis: The Impact On Consumer Attitudes & Behaviors In Japan

Publication Date	June 2009
Publisher	Datamonitor
Product Type	Report
Pages	78
ISBN Number	not applicable
Product Code	DAT15676

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Summary

86% of Japanese consumers believe that they are currently living in a recession. This is indicative of an intensifying 'recessionary mindset' influencing consumer behavior. Symptomatic of falling consumer confidence is the fact that over one-in-three Japanese consumers are having difficulty paying their bills and expect their household's financial situation to worsen throughout 2009

Scope

Detailed analysis documenting Japanese consumers' 'recessionary mindset' and how this influences perceptions about their current and future prospects
Insights highlighting how the economic downturn has affected perceived quality of life, emotional wellbeing and financial security in Japan
In-depth analysis of Japanese shoppers' changing price sensitivity, value consciousness and attitudes towards private label across FMCG sectors
Countries and categories covered: Japan; food and non-alcoholic beverages, alcoholic beverages, personal care and household care

Highlights

57% of Japanese consumers feel that their lifestyle has been impacted by the recession. Suddenly, they have been forced to re-evaluate their already cautious approach to consumption, including where they do their grocery shopping as well as their in-store choices

Habit is less influential in store destination than price or quality. This helps explain why one-quarter of Japanese grocery store shoppers are considering changing where they shop for food and drink products in order to save money

Over one-third of Japanese shoppers are giving up some of their favorite brands to save money. This presents an opportunity for the underdeveloped private label market in Japan to capitalize on price conscious consumers

Reasons to Purchase

Gain a detailed understanding of changing consumer attitudes and behaviors amid the downturn in order to determine appropriate recessionary strategies
Obtain country and sector specific insight about pertinent recessionary themes such as private label and consumers' value consciousness
Assist consumer segmentation and targeting efforts by accessing data from two waves of primary research conducted in August 2008 and April 2009

Content

Overview

Catalyst

Summary

Table of figures

Table of tables

THE FUTURE DECODED

INTRODUCTION: Understanding how 'recessionary mindsets' influence Japanese consumers' attitudes and actual consumption is vital
The 'recessionary mindset' of Japanese consumers is reflected by the widespread belief that they're in a recession
The economic downturn has had an impact on the lifestyles of more than half of Japanese consumers
Key takeouts and implications: a 'recessionary mindset' has coincided with a recessionary impact on Japanese consumers' lifestyles
TREND: Low consumer confidence is reflected by a generally negative outlook among Japanese consumers
Japanese citizens' gloomy outlook about the country's overall direction is affecting perceptions about their own quality of life
Key takeouts and implications: Japanese citizens' mood towards the direction of the country is largely pessimistic and this is having implications on their quality of life
TREND: Japanese consumers have lost confidence in their financial security and are being more scrupulous in response
Satisfaction with one's financial situation is low among Japanese consumers
Perceptions about the economy, job security, financial status and the housing market in Japan have all worsened, and there is only limited optimism for the six months ahead
Japanese consumers are managing their finances more closely, with some even struggling to pay the bills
The majority of Japanese consumers are making greater efforts to save and continue to be vigilant about credit
Key takeouts and implications: Japanese consumers have lost satisfaction with their financial situation and there is only mild optimism of any improvement coming towards the end of 2009
INSIGHT: The global economic crisis has had a negative impact on the emotional wellbeing of Japanese citizens with levels of stress up and personal happiness down
Stress levels have all been negatively impacted during the financial downturn
Work-life balance has also worsened in combination with the deepening downturn
The happiness levels Japanese citizens have declined in line with the global economic crisis
Key takeouts and implications: Japanese citizens have lost satisfaction in their financial situation and there is only mild optimism of any improvement coming towards the end of 2009
INSIGHT: Japanese consumers have become increasingly price and value conscious following the global economic downturn
Japanese consumers are becoming more value conscious and are therefore looking to save money when buying groceries
Price consciousness heavily influences where Japanese consumers do their grocery shopping and how they shop, but quality still matters too
Key takeouts and implications: the general price consciousness of Japanese consumers has intensified and is reflected by how they determine where to shop
INSIGHT: Brand loyalties are under increasing threat as Japanese shoppers give up brands and increasingly embrace private label
Japanese consumers are beginning to give up some of their favorite brands as they make more 'considered' choices
Private labels are becoming more attractive to Japanese shoppers in the downturn
Key takeouts and implications: the ingrained value consciousness of Japanese consumers, combined with their current reflective consumption patterns, will create an optimal platform for private label growth
INSIGHT: Japanese consumers are embracing money saving tactics when it comes to food and non-alcoholic beverage purchases and preparation
Japanese consumers are adopting various responses to cut back on food and beverage expenditures, particularly by preparing more meals at home
The majority of Japanese shoppers consider private label food and non-alcoholic beverages to be identical to famous branded equivalents
Key takeouts and implications: a resurging desire to cook more often at home has occurred while private label and market leading brand competition in food and non-alcoholic beverages will intensify
INSIGHT: The significant majority of Japanese consumers' personal care regimes and related product choices have been 'recession resistant'
Almost half of Japanese consumers are dissatisfied with their physical appearance
Price and value conscious personal care/beauty shoppers in Japan have not made notable changes to their personal care shopping and usage in order to save money
Japanese consumers are largely unaware of or indifferent towards private label personal care products
Key takeouts and implications: Japanese consumers' health and beauty regimes are proving to be largely recession resistant
INSIGHT: Japanese consumers' alcohol consumption preferences continue to shift throughout the downturn
Japanese drinkers are relatively careful about how much they spend on alcohol, but do not perceive that they have been making significant cut backs in the amount they consume
Japanese drinkers appear to have become more value conscious in their at-home alcoholic beverage choices than their out-of-home choices
Private label alcohol penetration in Japan is low which results in uncertainty about comparative quality against branded equivalents
Habit dictates Japanese consumers' alcohol purchases almost as much as price
Key takeouts and implications: there has been little to no change for the majority of Japanese drinkers suggesting that alcohol is largely 'recession resistant'
INSIGHT: Japanese consumers' household care buying preferences are heavily shaped by price consciousness irrespective of an economic downturn
Price-led value is still the most influential factor for Japanese consumers' household and laundry care purchases but preferences do reflect other important influences
The private label household care market in Japan is small
Key takeouts and implications: Japanese consumers associate hygiene and cleanliness with wellbeing and this, combined with their inherent dislike of household chores, makes them somewhat quality conscious

ACTION POINTS

ACTION: Adopt a relentless approach to delivering and communicating better value-for-money than the competition
Actively demonstrate price-led value by re-appraising marketing initiatives
The concept of value also applies to eliminating superfluous product attributes
Focus on quality to maintain differentiation and prove to consumers that quality really matters
Evaluate and adapt cost structures so that it is feasible to offer value-for-money solutions

APPENDIX

Methodology
Further reading and references
Ask the analyst
Datamonitor consulting
Disclaimer
Table 1: Consumer survey: level of satisfaction with "the general direction of how things are going" and "quality of life", in Japan (compared with the global average), 2009
Table 2: Consumer survey: satisfaction with current financial situation and importance attached to wealth/income and having finances in good order, in Japan (compared with the global average), 2009
Table 3: Consumer survey: perceptions of whether broader and personal economic conditions had improved or worsened in the six months previous, and how each might change in the proceeding six months, in Japan, 2009
Table 4: Consumer survey: propensity to feel tense and the extent to which perceived levels of stress have changed in the last six months, and are expected to change in the next six months, in Japan, 2008-09
Table 5: Consumer survey: propensity to feel very tired and the extent to which perceived work-life balance has changed in the last six months and are expected to change in the next six months, in Japan
Table 6: Consumer survey: happiness levels and the extent to which perceived happiness has changed in the last six months and are expected to change in the next six months, in Japan, 2008-09
Table 7: Consumer survey: changing value-consciousness and desire to save money when buying groceries among Japanese shoppers, 2009
Table 8: Consumer survey: changing efforts being made to use coupons, changes in grocery store choice to save money, embracing more disciplined shopping, and gathering and utilizing store price information, among Japanese shoppers, April 2008 to April 2009
Table 9: Consumer survey: the relative cost/value and quality consciousness of Japanese and global consumers overall when purchasing food and beverage products in 2008
Table 10: Consumer survey: the extent to which Japanese consumers are making effort to save money by adopting various food and drinks consumption and preparation approaches, 2008-09
Table 11: Consumer survey: perception about the relative superiority or inferiority of private labels versus well known or market leading famous brands in food, soft drinks and hot drinks, in Japan, 2009
Table 12: Total private label food penetration and spend ($ millions) in Japan, 2002-2012
Table 13: Total private label non-alcoholic beverages penetration and spend ($ millions) in Japan, 2002-2012
Table 14: Consumer survey: the importance attached to looking one's best in day-to-day life, the pressure to look good, and satisfaction with physical attractiveness/appearance, among Japanese consumers, 2008 and 2009
Table 15: Consumer survey: the extent to which consumers are making an effort to save money by using spas or salons less often, in Japan, 2008-09
Table 16: Consumer survey: attempts made by Japanese consumers to change their personal care/beauty habits in order to save money, by product category, 2008-09
Table 17: Total private label personal care penetration and spend ($ millions) in Japan, 2002-2012
Table 18: Consumer survey: perception about private labels versus well known or market leading famous brands for grooming/beauty products in the UK, 2009
Table 19: Consumer survey: attentiveness towards the amount of money spent on alcohol and the degree to which alcoholic beverage consumers in Japan have cut down on the overall amount of alcohol bought/consumed in 2008-09
Table 20: Total private label alcoholic beverage penetration and spend ($ millions) in Japan, 2002-2012
Table 21: Consumer survey: the degree to which household and laundry care consumers in Japan made product choices with value/cost and quality consideration in mind, 2008
Table 22: Consumer survey: Japanese attitudes towards doing housework, 2008
Table 23: Total private label household care penetration and spend ($m) in Japan, 2002-2012
Table 24: Consumer survey: perception about the relative superiority or inferiority of private labels versus well known or market-leading famous brands for household cleaning/laundry products, and how often such products are purchased to save money, in Japan, 2009
Figure 1: Datamonitor's Recession and Recovery portal will allow industry players to continually identify emerging opportunities and track what is happening in the Japanese economy as it develops
Figure 2: Over one-third of Japanese consumers 'strongly agree' that the country is in recession
Figure 3: More than half of Japanese consumers have felt the impact of recession
Figure 4: Japanese citizens are largely dissatisfied with the direction their country is going and this also appears to be negatively affecting their quality of life
Figure 5: Six out of 10 Japanese individuals are currently dissatisfied with their financial situation
Figure 6: The majority of Japanese citizens express negativity towards the country's economy, their personal finances and job security
Figure 7: Japanese consumers exhibit more negativity than the global average across all categories
Figure 8: Japanese consumers are managing their finances more closely while a third of individuals report difficulties in paying all the bills
Figure 9: Japanese consumers' money saving tactics did not intensify between August 2008 and April 2009
Figure 10: The economic downturn has also been accompanied by additional stress levels among Japanese citizens
Figure 11: Japanese citizens are prone to fatigue while almost one-third has experienced a worsening work-life balance in the period October 2008 to April 2009
Figure 12: Nearly one in three Japanese citizens has become less happy during the period October 2008 to April 2009
Figure 13: Six out of 10 Japanese consumers are more value conscious following the downturn
Figure 14: Lower prices have more influence than product quality or habit over where people in Japan do their shopping
Figure 15: Price and value consciousness is influencing where Japanese consumers do their grocery shopping and how they shop
Figure 16: Despite the depth of the downturn in Japan, consumers have been less inclined to sacrifice their favorite brands to save money
Figure 17: Nikkei named 'private brand' as one of the hits of 2008
Figure 18: Private label is less influential in Japan compared with the global average
Figure 19: Nearly one in five Japanese shoppers are routinely buying private label/store branded products in an effort to save money but this is well below the global average
Figure 20: The private label market is impacted by a broad range of drivers and inhibitors
Figure 21: Japanese consumers became increasingly value conscious in their food and beverage choices in 2008, but that was not reflected by a substantial quality compromise
Figure 22: The attributes deemed most influential in what food and beverages Japanese consumers buy also highlight the price consciousness shaping the choices they make
Figure 23: Japanese consumers are adopting various responses to cut back on food and beverage spend
Figure 24: The number of Japanese consumers cooking an evening meal at home from scratch every day almost doubled between August 2008 and April 2009
Figure 25: Japanese consumers are less inclined to eat a takeaway meal at home in 2009 compared to 2008
Figure 26: The majority of Japanese consumers perceive no difference between famous branded food products, soft drinks and hot drinks and private label equivalents
Figure 27: Japanese consumers are relatively appearance conscious and this makes them less willing to trade-down when making personal care choices
Figure 28: Japanese personal care/beauty shoppers became more price and value conscious in 2008 but showed little desire to sacrifice on quality
Figure 29: Personal care/beauty shoppers in Japan and elsewhere are highly price conscious
Figure 30: The popularity of spa treatments in Japan has led to an increase in at-home therapies
Figure 31: One-quarter of Japanese consumers consider private label beauty products to be good alternatives to well known or market leading brands while one-in-five thinks the opposite
Figure 32: Japanese consumers are careful about how much they spend on alcohol, but do not perceive that they have been making significant cut bucks in the amount they consume
Figure 33: Value consciousness among Japanese drinkers has had more impact on at-home alcohol consumption during 2008-09
Figure 34: Japanese drinkers, perhaps influenced by a sense of entitlement, are reluctant to opt for cheaper brands and formats of alcoholic beverages
Figure 35: Asahi has further cultivated its low-malt or "happoshu" offerings, which are taxed differently than beer and consequently sold at a lower price
Figure 36: Four out of 10 Japanese drinkers are highly influenced by alcohol beverage promotional offers, which is higher than consumers elsewhere
Figure 37: Only 21% of Japanese drinkers believe that private label alcoholic drinks are good alternatives to market-leading or famous brands
Figure 38: Japanese consumers are largely unfamiliar with or inexperienced drinkers of private label alcoholic beverages
Figure 39: Although Japanese drinkers are price conscious, habit also heavily shapes preferences
Figure 40: Price is the most influential factor in Japanese consumers' household and laundry care purchases
Figure 41: Japanese household and laundry care choices were largely unchanged between February and August 2008
Figure 42: Japanese citizens value cleanliness, inherently dislike household tasks and seek to minimize the amount of time they spend on such tasks
Figure 43: Four out of 10 Japanese consumers regularly purchase household care products on the basis of value-for-money, which is lower than consumers across 17 countries
Figure 44: A relatively small proportion of Japanese consumers regularly purchases private label household care products to save money
Figure 45: A small proportion of Japanese shoppers consider private label household and laundry products to be superior to branded equivalents
Figure 46: The 'Eco-Mottainai.com' project is one of many targeting price-conscious grocery shoppers
Figure 47: Beauty products that are suitable for use any time of the day are increasingly appealing to Japanese consumers looking for less complicated offerings
Figure 48: Manufacturers and retailers looking to deliver value-for-money must in the provision of factors associated with the PPI, but while also offering consumers lower than expected prices
Figure 49: A giant t-shirt vending machine is installed in budget-friendly clothing store Uniqlo, which combines cutting edge design with mass market appeal