Expert on Japan Retail and Consumer Markets, JapanConsuming

Michael Causton

Expert on Japan Retail and Consumer Markets

Real Insight on Japanese Consumer Markets

JapanConsuming

JapanConsuming is a specialist research firm producing intelligence on Japanese retail and consumer markets. Founded in 2000, JapanConsuming has become the leading provider of insights on Japanese retailers and consumer trends to retailers, brands, government agencies and investors. As well as a highly regarded monthly report on the market, JapanConsuming produces in-depth reports on retail sectors, seminars on key trends and telephone consulting to investors on trends and retailers.

JapanConsuming was founded by Michael Causton and Roy Larke. 

Thematic (Sector/Industry)

<ul>
<li>The latest figures show that Japanese incomes fell for the first time in five years in 2021. </li>
<li>But despite this, average monthly household expenditure recovered and then accelerated at the end of the year. Online spending grew significantly, and much of this was new growth</li>
<li>We detail below which retailers are likely to benefit from these shifts in consumption behaviour over the next few years.</li>
</ul>


The latest figures show that Japanese incomes fell for the first time in five years in 2021. 
But despite this, average monthly household expenditure recovered and then accelerated at the end of the year. Online spending grew significantly, and much of this was new growth
We detail below which retailers are likely to benefit from these shifts in consumption behaviour over the next few years.


Japanese Household Expenditure in 2021 and Beyond: Which Retailers Will Benefit?

<ul>
<li>This is an in-depth review of Japanese e-commerce in the last 18 months, a time when e-commerce expanded rapidly and by 2023, e-commerce will be Japan’s single biggest retail channel.</li>
<li>We are now riding a wave of change as retailers integrate the e-commerce channel into their businesses, increasingly approaching a true omnichannel model.</li>
<li>And this is important in Japan because, although e-commerce penetration appears low, this overlooks the importance, convenience and ease of access to physical shops and integration with online.</li>
</ul>


This is an in-depth review of Japanese e-commerce in the last 18 months, a time when e-commerce expanded rapidly and by 2023, e-commerce will be Japan’s single biggest retail channel.
We are now riding a wave of change as retailers integrate the e-commerce channel into their businesses, increasingly approaching a true omnichannel model.
And this is important in Japan because, although e-commerce penetration appears low, this overlooks the importance, convenience and ease of access to physical shops and integration with online.


<ul>
<li>Consumers have long believed that inflation is about to return – an idea promoted by Abenomics since 2012 despite a stubborn lack of actual progress.</li>
<li>Now, analysts think real inflation might be just around the corner and consumers’ fears could suddenly be justified. </li>
<li>Retailers have begun to announce a series of price cuts, recognising consumers’ worries about prices and looking to reassure and gain market share at the same time.</li>
</ul>


Consumers have long believed that inflation is about to return – an idea promoted by Abenomics since 2012 despite a stubborn lack of actual progress.
Now, analysts think real inflation might be just around the corner and consumers’ fears could suddenly be justified. 
Retailers have begun to announce a series of price cuts, recognising consumers’ worries about prices and looking to reassure and gain market share at the same time.


Nitori and Muji: Cutting Prices as Inflation Nears

The desire for home improvement was already building well before the pandemic but Japanese have turned to home decoration like never before since March 2020 as long days at home led to demand for more comfort and better aesthetics. With visits to physical stores currently something of a challenge, online sources have boomed, including new subscription rental services. While <a href="https://www.smartkarma.com/entities/nitori-holdings-co-ltd" target="_blank" data-smartkarma-citation="entities:20386:1" rel="noopener">Nitori Holdings (9843 JP)</a> is a beneficiary of this trend, competitors have also seen sharp gains in volume, suggesting further new competition for the dominant player. Lowya for example is now expecting compound annual growth (CAGR) of between 21-26% over the next five years, with a forecast ¥60 billion in GTVs in 2026.

The desire for home improvement was already building well before the pandemic but Japanese have turned to home decoration like never before since March 2020 as long days at home led to demand for more comfort and better aesthetics. With visits to physical stores currently something of a challenge, online sources have boomed, including new subscription rental services. While Nitori Holdings (9843 JP) is a beneficiary of this trend, competitors have also seen sharp gains in volume, suggesting further new competition for the dominant player. Lowya for example is now expecting compound annual growth (CAGR) of between 21-26% over the next five years, with a forecast ¥60 billion in GTVs in 2026.

Competition for Nitori: Online Furniture Sales Surge

The following is an in-depth review of Japanese retail in the last 18 months covering all the main formats and categories, providing a quick way to see an overview of all the key trends and winners and losers in Japanese retailing now and going forward.FY2020 was an anomaly and one that businesses everywhere will want to forget and never repeat. There was more than enough pain among Japan’s top retailers last year, but equally some formats did surprisingly well given the circumstances.For most, work-from-home was the single most important factor in determining a chain’s fortunes. City-centre stores and shopping centres offering mostly discretionary shopping have been hit hard, as have convenience stores.But those chains selling essentials, healthcare, electronics and, most importantly, food, all saw their fortunes improve. The pandemic has also revealed the strong, dynamic players and exposed the weaker ones. Oh, and everyone needs to be online.

The following is an in-depth review of Japanese retail in the last 18 months covering all the main formats and categories, providing a quick way to see an overview of all the key trends and winners and losers in Japanese retailing now and going forward.FY2020 was an anomaly and one that businesses everywhere will want to forget and never repeat. There was more than enough pain among Japan’s top retailers last year, but equally some formats did surprisingly well given the circumstances.For most, work-from-home was the single most important factor in determining a chain’s fortunes. City-centre stores and shopping centres offering mostly discretionary shopping have been hit hard, as have convenience stores.But those chains selling essentials, healthcare, electronics and, most importantly, food, all saw their fortunes improve. The pandemic has also revealed the strong, dynamic players and exposed the weaker ones. Oh, and everyone needs to be online.

The Polarising Pandemic in Japanese Retail

Japan

Nitori Holdings Co., Ltd., is based in Hokkaido and operates a furniture retail chain.  The Company sells living room furniture, storage furniture, dining furniture, office furniture, beds, and interior goods.  Nitori Holdings also sells original brand merchandise and imported merchandise.

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Nitori Holdings (9843 JP)

Japanese Household Expenditure in 2021 and Beyond: Which Retailers Will Benefit?

Japanese spent more on homes and less on clothes in the last two years but they also added to their savings. This insight analyses the key...

Michael Causton

E-Commerce in Japan: The Big Review

Japan's e-commerce sector expanded rapidly in the last 18 months. The following is a complete review and analysis of the major trends as well as...

Michael Causton

Nitori and Muji: Cutting Prices as Inflation Nears

Japanese non-FMCG retailers are facing pressure to cut prices as consumers, under pressure from rising prices of basics like food. In home...

Michael Causton

Competition for Nitori: Online Furniture Sales Surge

Nitori remains number one by far and its own e-commerce site is doing well but other online-only stores have seen fast growth, creating new forms...

Michael Causton

The Polarising Pandemic in Japanese Retail

A complete review of the Japanese retail sector in the last 18 months, format by format, category by category, providing key trends and winners &...

Michael Causton

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