TOKYO, Oct. 26, 2015 — Epsilon, the global leader in creating connections between people and brands, has completed its study on the habits of Japanese consumers. Digging deeply into loyalty drivers by product sector and demographic segment, Epsilon’s report “What Loyalty Looks Like” reveals Japanese consumers have stronger loyalty towards credit card and multi-merchant rewards programs and e-commerce platforms.
This year’s survey results were consistent with key trends cited in Epsilon’s past Japan loyalty study, quality, value for money and service remain the top three motivators for brand loyalty, and email remains the preferred method for loyalty communication. One finding especially worth noting is: credit card and multi-merchant rewards programs and e-commerce platforms have the highest loyalty among consumers.
When asked to name the sectors that they are most loyal to:
- 40% of Japanese consumers put credit card reward programs and ecommerce in a tie for the top spot.
- Automotive, Japan’s quintessential consumer sector, took second place with 36% of consumers.
- Another points-driven sector, multi-merchant programs, took third place with 32% of respondents.
- On average, Japan’s shoppers participate in 2.4 credit card rewards programs, 2.8 e-Commerce loyalty programs, and 2.4 multi-merchant programs. Among those multi-merchant schemes, T-Points, a cross-industry rewards platform focused on grocery, gas and daily necessity purchases, counted 77% of our respondents as members.
Frank Anan, Epsilon’s Tokyo-based, Senior Vice President for Digital, International, summarizes, “In Japan, value for money is a dominant purchase driver. Rewards programs have become integral to the consumption economy by delivering incremental economic value on each purchase made with a credit-card, e-commerce, or multi-brand coalition platform.” Still, there is more to brand relationship than points. Anan continues, “One-to-one engagement activities add the dimension of a personal relationship to value-based purchases.”
Those activities will need to be tailored closely to the sub-group and sector. Dominic Powers, Executive Vice President and Managing Director, International, says, “Beyond the topline finding that in Japan, quality is always the top motivator for loyalty, we see second, third and fourth level drivers and touch points that are different for every category and consumer group.”
The top three loyalty motivators, across the board, are quality (20%), value for money (19%), and customer service (18%). Yet there are powerful drivers beneath this umbrella: clothing and luxury sector loyalists emphasize shared values (21%) and personalized communication (17%) as reasons to be loyal. Among travel company loyalists, 18% are motivated by convenient locations.
Epsilon’s research report uncovered several other Japan loyalty trends, as follows:
When we asked Japanese consumers about their reasons for being loyal to their favorite brands, we uncovered attitudes about lifestyle versus value for money. In grocery and e-commerce, value trumped lifestyle. Yet the Japanese consumer’s quest for innovative products in fashion, food and beverage, means that in those sectors “having new products that meet my needs and fit my lifestyle” was nearly twice as important as “best value for money.”
For lifestyle categories, financial services, luxury, clothing, cosmetic and restaurant brands interact with their loyalists at a relatively low frequency. A number of loyalists in these sectors say they have never been contacted by the brand. There is an opportunity to not only begin a regular outreach through functional channels like email and in-store, but to open up additional and more social touch points. Loyalists in these categories are more likely to enjoy photos shared by the brand and other customers, and seek out product review websites.
Saving money is the most powerful motivator for brand interaction in Japan. The type of communication of interest to a whopping 76% of consumers is a discount or sale offer. Japanese consumers are online daily and interacting several times each week with credit card rewards, e-commerce, multi-merchant points and grocery brands.
Overall, the highest levels of interaction are less about prestige, membership and the joy of consuming the finer things in life and more directed to squeezing the maximum value from each yen.
For the full report “What Loyalty Looks Like: Updating the Toolkit for Today’s Japan,” click here.
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