“How Japan’s Global Brands Were Built: Lessons for Emerging Market Companies” was one of the most stimulating papers at the Association of Japanese Business Studies conference I attended in Istanbul last month. It was presented by Johny K. Johansson, Professor of Marketing and International Business, McDonough School of Business, Georgetown University. He told me afterwards that he’s just retired, but does have a major textbook coming out on global branding soon.
It was a paper born out of long experience rather than crunching numbers (the latter approach preferred by many other presenters) and was attempting to make Japan’s experience more widely applicable (as I previously noted, many Western Japan specialists at the conference were lamenting how irrelevant Japan is seen to be, damaging their careers). However he concluded that what companies such as Sony, Honda and Canon achieved were probably not replicable by emerging market companies.
His main conclusion was that Sony, Honda and Canon succeeded (and continue to endure as global brands) because they were not succeeding in the Japanese domestic market to the extent that Matsushita and Nissan had. He outlines five major strategic dimensions to look for, as globally successful brands:
1. Role of managerial vision – particularly a focus on the global market by the top executives, which Honda and Morita both had
2. Dynamic resource based framework – developing and using the organisation
3. Competitive positoning a la Michael Porter
4. Demand oriented – targeting niche markets
5. Blue ocean – creating truly new innovations
and showed that Honda, Sony, and Canon all created new and innovative products, and new niches, and very much did not refer to their country of origin in their marketing. Johansson described Sony and Honda as “stronger brands in the US than in Japan”.
Specifically, Sony’s founder Morita was key, in that he told Bulova Sony would not make OEM for them any more and cut Delmonico as a distributor because it was discounting. He had the courage to introduce the Trinitron in 1970 at a premium price. Honda refused to merge with Kawasaki or Yamaha, and focused on its roots in racing. Canon was in financial trouble initially, weaker than Nikon, but created the first automatic SLR and introduced into the US market in 1976, as well as promoting its global philosophy of kyosei.
The alternative follower strategy of Panasonic, Toyota, Nissan and Seiko was more around working hard, and improving – which can cause the “red ocean” that blue ocean strategies avoid. Toyota is of course one of the strongest Japanese global brands now, so the follower strategy can work.
In terms of emerging market companies, Johansson believes they can only do what Sony or Honda did if they have innovative products, do not focus on their home market (Chinese companies are happy with their own markets by and large) and have strong leadership.
Just last week Nikkei Research analysed the past ten years of surveys it has conducted on perceptions of 277 corporate brands amongst consumers and business people. Although most brand surveys show a heavy bias towards domestic brands, I was quite surprised to see Google, Amazon and Microsoft in the top 3, with Yamato Transport (a parcel delivery firm) being the top domestic brand in 4th place.
The other brand rankings were:
9. Kagome (food)
10. Ajinomoto (food)
12. Morinaga (food)
13. TOTO (sanitaryware)
14. Kewpie (food)
15. Nissin (food)
17. Nagatanien (food)
18 Coca Cola
=19 Sony and Shachihata (stationery)
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