Iconiq

The past couple years have been difficult for participants in the Japanese media industry as it has been for their global peers. The global financial crisis exacerbated changing advertising spending allocations due to lower readership of old media magazines and newspapers. In addition, the music industry continues to shrink due to lower CD sales and aging demographics.

While not entirely unique nor pioneering, Avex's experiment with Iconiq is a response to the aforementioned market trends. Iconiq is the not-so-clever name picked by Avex, a major Japanese record label, to fashion an overnight success from an unknown B-level teeny-bopper pop singer. Avex substituted the traditional marketing strategy of a pop act - press, events and publicity to hype up several singles and music videos - with a massive coordinated marketing blitz. Avex lined up seven sponsors in an unprecedented advertising blitz to paste Iconiq's face on billboards throughout Japan. The seven sponsors are Shiseido, ANA, Starbucks, Maserati, Kitson, mu-mo and Rhythm Zone (a division of Avex). Impressively, Avex announced Iconiq's debut by means of a Shiseido commercial where her shoulder-length hair is buzz-cut.

Through pure force of marketing, Avex achieved immediate face recognition through Iconiq's constant presence on billboards, TV commercials, magazine covers, etc. The second phase was Iconiq's music debut - her initial album launched at #3 on the Oricon charts, which may reflect her producer's purchases more than consumer support. Avex has pulled out all the stops and will continue to ensure Iconiq has ample airplay on TV and radio. Unfortunately, the music is an emotionless B-grade pop sound and does not match the name nor the buzz-cut look. While the verdict is still out on whether Avex can make Iconiq a success, it appears even a massive campaign cannot sell mediocre music.

On the other hand, The Japan Times happily delivers Avex's PR line here.

Tasaki Pearls

Two years after being taken over by private equity firm MBK Partners, Tasaki Pearls is completing a full financial re-structuring and design makeover. Tasaki traditionally played a distant #2 from Mikimoto Pearls in Japan, and fell into financial disrepair. Following its takeover by MBK Partners, Tasaki shut down a number of retail outlets and more savvily has hired a number of outside designers to re-imagine the brand. One designer making a difference for Tasaki is Thakoon Panichgul, a favorite designer of Michelle Obama. The Japan Times also has a quick blurb on the makeover here. While the verdict on Tasaki's strategy and aesthetic is still out, perhaps the fear regarding the viability of Japan Inc. is overblown - perhaps Japan Inc. can re-invent itself for the 21st century.

Kyoto Tourism

Kyoto is Japan's leading light in tourism, an industry the government is aiming to boost, in the near term to 10 million inbound tourists annually, and long term o 20 million tourists. The obvious country to market towards is China, and this is happening with easing of visa regulations.

An article in the New York Times takes a look at the debate among vested parties in Kyoto on how and where that city's tourism industry should focus. For some, Orix's proposed aquarium (Japanese only) in the city center is the right approach to draw in new crowds. But for the majority, Kyoto's value and draw for tourists is in presenting traditional Japan to the world. Kyoto was spared the massive carpet-bombing other Japanese cities endured during World War II, and preserves many World Heritage-quality sites. During the post-war decades, the Kyoto people tore down the old city themselves and re-built it in post-modern concrete, as is Kyoto Station itself. Only over the past decade have stronger zoning policies been implemented and an appreciation for the old Kyoto been nurtured. This has fostered a vibrant inner city of old renovated machiya houses, coffeeshops, boutiques and traditional artisan stores, which fills out a tourist's experiences beyond historical site visits and allows them to interact with locals. One such area is the Nishiki market.

Beyond Kyoto, Japan is looking for ways to make itself more tourist-friendly. The big draw this year is Nara's 1300th anniversary, which has had problems in promoting itself and standing apart from Kyoto. The Japan Times has a quick summary here. Perhaps in the end the private industry will need to lead the effort to promote Japan and make the pitch to potential tourists, as the Japan Times reports.

Japanese politicians vs. bureaucrats

Round 2 of the Japanese DPJ politicians inquisition of bureaucrat-led spending（事業仕分け） started a week ago, with the politicians slating 42 organizations for closure and JPY 350 billion worth of spending cuts (article in Japanese). This round continues from May 20th and is being closely watched by the nation, as the interrogative questioning provides excellent television viewing. (The lead "prosecutor", Renho, comes across as the type of firebrand Japan needs. An interview with the Japan Times follows her background) This follows Round 1, which led to substantial spending cuts when concluded in November 2009; highlighted projects can be seen in Japanese here.

In addition to taking some of the national attention off Hatoyama's inability to make decisions on Futenma and Ozawa's money-raising improprieties, the politician-bureaucrat debates on public spending are raising awareness of how capital is allocated by the Japanese government. And further, whether the bureaucracy's allocation of capital is helpful to the country or not. Certain bureaucrat traditions such as amakudari (practice of bureaucrats taking cushy roles in related counterparties upon retirement as gratitude for prior patronage) are now widely frowned upon. But it has taken Japan until the post-Koizumi era to put bureaucratic capital allocations under the magnifying glass.