********************************************************** Japan Internet Report No. 50 August/September 2000 ********************************************************** In this month's issue: - It's a woman's world - Quote of the month - Reach more than 40,000 women in Japan - Wireless access still more "phone" than "Net" - Did Bill Gates want to buy Hello Kitty for $5.6 billion? - Work with me on this one... ********************************************************** It's a woman's world This month I spent a lot of time thinking about women in Japan - at the behest of clients, naturally. Women comprise the most important target consumer market in Japan. That's not just because they command such extensive purchasing power - it's because they are trendsetters in many areas of consumption, and from a surprisingly early age (high school, or even junior high school). Among professional marketers in Japan, it goes without saying that you have to reach women in order to be successful. More than three years ago, when asked which user group he wanted to target online, Masato Takashi, then-director of Recruit's multimedia division, responded as follows: "It's going to be women from now on. It seems that women are more in tune with the networking and information aspects of the Internet. We have very high hopes for the female audience. In fact, they are so high that I'd venture to say that this online business will not succeed without growth in this segment." Overseas firms moving into Japan's Internet space are starting to take the point. More and more firms are focusing their marketing efforts on the young single women and housewives who drive retail sales. Watching a focus group of Internet-savvy, Tokyo-based women talk about the Web and e-mail, I was struck by how thoughtful and resourceful they are: It was crystal clear how powerful an effect their use of the Internet is having on the client that sponsored the research. The Internet is creating a culture of self-service in which customers rely less on traditional bricks-and-mortar infrastructure, with tremendous impact on client earnings. This is a pattern we've seen before when traditional enterprises move online, and watching the tranformation take place is always a thrill... ********************************************************** Quote of the month Mari Matsunaga, the woman who designed the information offerings for NTT DoCoMo's i-mode service, on why she turned down all the high-powered job offers she received after leaving DoCoMo to join eWoman: "I got tired of making money for men. I want to focus on leveraging womens' drive and abilities in business. (Now I can finally work in) 'my mode'." ********************************************************** Reach more than 40,000 women in Japan Since January of this year, we've been working on a Japan-specific service offering on behalf of Promotions.com of the U.S. The first version of the consumer site launched June 15, and so far it has attracted more than 75,000 registered users, the majority of whom are women. Promotions.com offers a real-time, permission-based lead generation service. The Japan version is still in beta mode, but test customers such as JTB and Microsoft Japan are seeing opt-in rates as high as 64%. We are consistently achieving opt-in results in the 15-30% range, and conversion to online registration, telephone inquiries, etc. is excellent. Moreover, the site is being covered extensively in the Japanese press, and was featured in DoCoMo's latest promotional materials for the "Mopera" series of i-mode-centric personal digital assistants. More details and contact information are available at http://jp.promotions.com ********************************************************** Wireless access still more "phone" than "Net" A lot of people are saying that access to the Internet in Japan (and in Asia) is going wireless, and that soon the number of wireless Internet users will far exceed the number of wireline Internet users (I think I even said that myself not too long ago). Others claim that b-to-c Internet applications are going wireless, while b-to-b applications will remain on the desktop, etc. I feel less and less comfortable with these kinds of statements. With all the excitement over i-mode's spectacular success and commercial possibilities, it's easy to lose sight of a key fact: Most users perceive the ability to go online as an extension of telephone handset functionality - they don't think of their handsets as vehicles for accessing the Internet. In fact, it's clear that many i-mode users are not even aware that they are using the Internet. And the percentage of i-mode users who also use PCs to go online is dropping quickly and steadily. This leaves a larger and larger subscriber base who are counted as "Internet" users, but who do little more than send simple e-mail messages and play with entertainment-oriented services within DoCoMo's network of pushbutton information providers. When talking about the number of Internet users in Japan, therefore, it's simplistic to say that there are "14 million Internet users going online via cellular handsets." Most of these people are simply playing with their telephones. Of course, these people are still making use of the Internet, even if they don't realize it. And the key to ubiquitous Internet usage is simplicity and transparency - like a telephone that works when you dial (no need to understand the mechanics of how your call is being placed). Eventually we will have such ubiquitous, transparent, wireless Internet capabilities, with location-specific services driving much of the activity. But in the meantime, there's a world of difference between the typical i-mode and desktop Internet users here in Japan... ********************************************************** Did Bill Gates want to buy Hello Kitty for $5.6 billion? Six years ago Bill Gates wanted to buy the wildly popular Hello Kitty character from Sanrio for approximately $5.6 billion, according to Sanrio president Shintaro Tsuji. Apparently Bill has been fascinated by Kitty and other Sanrio characters for nearly 20 years, and he foresaw the time when such characters would become indispensable for helping novices warm up to "computing life." Mr. Tsuji admits that a formal offer was never made, but he says that he wouldn't have sold in any case. His reasoning? "(Hello Kitty) produces annual pretax earnings of $141.5 million. Assuming a discount rate of 1%, its market value is $14.15 billion. We would never sell it for a mere $5.6 billion." Maybe if Bill could argue that discount rate up to 2.5%, he'd have a chance... ;) ********************************************************** Work with me on this one... I'm swamped and need help. Looking for a native speaker of English with strong Japanese reading ability and significant business experience in Japan. This person will work directly with me on a diversity of projects (the 97% of my workload outside of Japan Internet Report). This Tokyo-based position requires the ability to rapidly read and comprehend Japanese language newspapers and magazines without a dictionary. The ideal applicant will have strong analytical capabilities and will enjoy asking (and answering) the hard questions. If qualified and interested, please contact me directly at tim.clark@twc-jp.com. ********************************************************** Tim Clark Editor To subscribe or unsubscribe to JIR, send any message to: subscribejir@tkai.com unsubscribejir@tkai.com Copyright 2002 by Ion Global All rights reserved ---------------------------------------------------------- Ion Global a chinadotcom company http://www.ion-global.com / http://www.jir.net/ Tokyo Tel. (813) 5464-0384 Fax 5464-0387 U.S. Tel. (503) 235-4433 Fax 235-4422 ----------------------------------------------------------