Recently, I made one of my regular trips to Japan for IS strategy
meetings at our corporate headquarters in Tokyo. During this trip, I visited
some of the major technology centers of the city. Since so much hardware related
technology is produced in Japan, I have always found these visits enlightening.
Let me share a few of my observations from this latest trip with you.
After checking into the hotel in Shinjuku and after getting a full
night of sleep, our group took the train to the technology shopping area in
Tokyo known as Akihabara. This is one amazing place. A serious techno-junkie's
heaven. Promptly upon exiting the train station, several of our US based staff
members who were experiencing Japan for the first time went wide-eyed. They
suggested that we establish a meeting place to regroup several hours later.
Akihabara can be overwhelming, and they quickly realized that it is best
experienced at your own pace.
Akihabara is also hard to describe in words. Just picture many city
blocks of about ten story buildings, each containing a massive electronic
products store. Every floor of every store is packed with the latest in
computers, software, cameras, phones, stereos, video equipment, and thousands of
related electronic items. Illuminate the whole thing with gigantic neon signs,
massive outdoor video screens, and rows of blinking light blubs, and you have
created Akihabara. It is kind of a cross between a "Best Buy" and the city of
During my first visit in 1994, I found the prices to be a little on
the expensive side (because of the exchange rate), but this trip I found the
prices to be very reasonable. Since I have visited Akihabara during previous
trips, there are several stores I now consider to be my favorites. This trip I
went straight to these stores and spent my time asking questions (mostly in
English) about some of the most popular technology offerings.
I found this visit's hot items to be sub-notebook computers, mini-disk
players, mini-cell phones, and digital cameras. Clearly the Japanese still like
their electronics to come in small packages!
The most popular sub-notebooks appeared to be the Libretto from
Toshiba, and a Japanese market specific product from Fujitsu. IBM also had a
smaller notebook for sale which I had not yet seen yet the US. All were rich
with features and functionality.
A big surprise to me was that the cassette tape player is quickly
disappearing in Japan. Mini-disk players are everywhere! These use a cartridge
which contains a very small CD disk which can hold about seventy five minutes of
music or voice recordings. The quality and media life span is incomparable to
the old cassette tape media. I predict that this same trend will sweep the US
market very soon.
Another hot product is the mini-cell phone. These low power devices
are about half the size of a US cell phone, and they only work if you are fairly
close to the cellular tower. So the Japanese have installed numerous towers up
and down the major train lines, and very quickly a huge market has emerged for
this new communications product. I saw hundreds of models to choose from in
My jaw dropper of the trip was seeing Microsoft booths in several
train stations. These booths were the same type that you see at computer trade
shows. Each was equipped with large video monitors, and a marketing specialist
was giving demonstrations of several Microsoft products including the Windows 98
Beta. I would have never guessed that I would get my first in-depth overview of
Windows 98 while standing in a Japanese train station!
Based on my periodic shopping trips over the last four years,
Microsoft and IBM appear to be the two major US companies with really
significant market penetration in Japan. Even in Akihabara, I only saw very a
few offerings from Compaq, and none were notebooks (very surprising to me).
A very popular new computer application in Japan is the software used
to manipulate video images from digital cameras. The Japanese love photography,
and digital cameras are a huge hit! I saw many digital cameras in use
everywhere. Even at our corporate meetings a photographer slipped in with with a
digital camera to take a quick photo for later posting on a company intranet
A Surprise Encounter with Dell
People have told me that they have seen Dell products for sale in
certain stores in Japan and I believe them. But I personally have never found a
Dell product anywhere. Of course, it only took me four years to find the only
vending machine in Tokyo which actually sells cans of Dr. Pepper (not a very
popular drink in Japan).
So you can imagine my surprise one morning when I went down to the
lobby of the Tokyo Hilton to find Dell Direct signs everywhere! Dell had
obtained a large number of large meeting rooms at the Hilton for what appeared
to be a convention of some sort. Living in Austin, and knowing many of the Dell
marketing executives, I wandered through the large meeting rooms hoping to spot
a familiar face. Not only did I not see anyone from Austin, I didn't see anyone
that I could say with confidence was even from the United
Every meeting was being conducted in Japanese by a Japanese
national, and all of the product literature was printed in a format I consider
to be appropriate for Japanese marketing. I even listened in on a traditional
Japanese awards ceremony where it appeared that marketing representatives were
receiving sales awards! I asked one of the representatives out front if Dell was
planning on using their direct marketing approach in Japan. "Indeed they were,"
replied the representative.
I was impressed. Not by the fact that Dell was present in Japan.
Mainly I was impressed by the fact that the whole affair seemed to me to be very
Japanese. This is a marketing lesson that many US companies have not really
understood very well. Based on my experience at the Tokyo Hilton, I am
predicting success for Dell in Japan.