Navigating Japanese E-CommerceYosuke Ito General Manager of cleverbridge KK

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Navigating Japanese E-Commerce

About cleverbridgecleverbridge is the premier e-commerce provider for software and SaaS companies around the globe. Drawing from years of experience and expertise, cleverbridge provides a customized, multi-channel e-business solution.

International corporations like Avira, GFI, Ipswitch and Quest Software count on cleverbridge to support their perpetual license, SaaS and subscription-based e-commerce needs.

#cbJapan

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Introduction

General Manager Japan Japanese Native from Tokyo

Software business experience for 25 years in Japan and US for Japanese, US and European companies as a country manager

B2B and B2C software businesssuch as Financial, Security, Utilities and Games

Long term localization experience

Major EC platform provider for 6 years

Educated in San Francisco / TokyoWorked in US and Australia

Yosuke Ito 　伊藤陽介 いとうようすけ　イトウヨウスケ

Navigating Japanese E-Commerce

Questions? @cleverbridge

#cbJapan

Craig VodnikVP of Marketingcleverbridge@craigvodnik

Yosuke ItoGeneral Managercleverbridge KK

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• Basic Information of Japanese Market

• Language Barriers

• Localization & Web Design / UX

• Currency & Payment Methods

• Quality Assurance

• Customer Support

Navigating Japanese E-Commerce

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Japan vs. US vs. Germany

Source: Wikipedia

JapanPopulation: 128 MillionLand size: 377K sq km

GermanyPopulation: 82 MillionLand size: 355K sq km

USPopulation: 300 MillionLand size: 9.4 million sq km

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Specified Delivery Date and Time

5 time slots

6 time slots

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Internet User Population

Source: Google Public Data

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Internet User Population (%)

Source: Google Public Data

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IcelandLuxembourg

EstoniaSlovenia

Slovak RepublicIreland

New ZealandFinland

Czech RepublicNorway

IsraelChile

HungaryAustria

DenmarkPortugalGreece

SwitzerlandSwedenBelgium

AustraliaPoland

NetherlandsTurkey

CanadaSpain

MexicoItaly

KoreaUnited Kingdom

FranceGermany

JapanUnited States

0 10,000,000 20,000,000 30,000,000 40,000,000 50,000,000 60,000,000 70,000,000 80,000,000 90,000,000

Total fixed (wired) broadband subscriptions, by country, millions, June 2011

Global Wired Broadband Subscriptions

Source: OECD

United States: 84,672,000 (25%)

Japan: 34,360,672 (11%)

Germany: 26,615,000 (8%)

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Global Wireless Broadband Subscriptions

IcelandLuxembourg

EstoniaMexico

SloveniaHungaryBelgium

ChileSlovak Republic

New ZealandIrelandAustria

IsraelGreeceTurkey

NorwaySwitzerland

DenmarkFinland

Czech RepublicPortugal

NetherlandsSwedenCanada

AustraliaPoland

SpainGermany

FranceItaly

United KingdomKoreaJapan

United States

0 50,000,000 100,000,000 150,000,000 200,000,000 250,000,000

Total wireless broadband subscriptions, by country, millions, June 2011

Source: OECD

United States: 203,180,000 (34%)

Japan: 101,869,228 (17%)

Germany: 23,874,300 (4%)

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US Online Retail Sales

B2C Market Size in Japan

Source: Forrester Research

Compound Annual Growth Rate (CAGR): 9.16%

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German Online Retail Sales

B2C Market Size in Japan

Source: Forrester Research

Compound Annual Growth Rate (CAGR): 10.75%

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Japanese Online Retail Sales

B2C Market Size in Japan

Compound Annual Growth Rate (CAGR): 9.60%

Source: Forrester Research

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Japanese SaaS Growth

Source: Forrester Research Compound Annual Growth Rate (CAGR): 57.24%

Total $723 $1,096 $1,764 $2,795 $4,077 $5,662 $7,604 $9,845 $11,962 $13,925 $15,6464

Language & Localization & Design

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Cultural Diversity

White

Hispanic

Black

Asian

Amerindian / Alaskan native

Native Hawaiian / Pacific Islander

Two or More race

Source: CIA World Factbook

German

Turkish

Greek

Italian

Polish

Russian

Serbo-Croation

Spanish

Japanese

Korean

Chinese

Other

USA Germany Japan

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Localization

• Localize your product, website and entire e-commerce infrastructure into Japanese.

• Don’t use raw translation materials• Proof read by industry expert

• Information must be transparently open and clear.

• Auto-Renewal

• Japanese localization requires a double byte enabled infrastructure.(Unicode 6.1)

Web Design

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Web Design

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Web Design

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Currency & Payment Methods

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Payment Methods (Konbini)

• Customer orders goods

online

• Customer selects the

convenience store option

and are then given a pay

ID.

• Customers have six days

to go to a konbini and pay

for their items after which

the goods are then

shipped.

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• Major Credit Cards: 76.6%

• Konbini: 17.2%

• PayPal: 6.3%

Payment Methods Usage Ratio

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Pricing Strategy

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Everyday Low Price VS Limited Time Offer

Japanese people love campaigns.

The Limited Time Offer is always well accepted by Japanese customers.

Campaign for every 2 months• Summer in July• Fall in September• Xmas in December• New Year in January• Spring in March • Golden Week in May

Buying Habits

Quality Assurance

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Japanese customers are:• Quality oriented, expect high standard to

the products, documents in Japanese• Their computer literacy level is low

• Surprised to see error messages

• Not good at English• Shocked to see messages in English

Quality Assurance

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Quality Assurance

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• Do the quality assurance work well• Test products on different hardware

Quality Assurance

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Risks to release non-tested products

• People think it is scam• Spread rumors in social network• Spread bad reputations without knowing

Quality Assurance

Customer Support

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Customer Support

Not Busy Busy Very Busy

　 Mon Tue Wed Thu Fri

10:00 to 11:00 　 　 　 　 　

11:00 to 12:00 　 　 　 　 　

12:00 to 13:00 　 　 　 　 　

13:00 to 14:00 　 　 　 　 　

14:00 to 15:00 　 　 　 　 　

15:00 to 16:00 　 　 　 　 　

16:00 to 17:00 　 　 　 　 　

Ave. Waiting Time in Second

34 15 13 12 10

Monday Last week longest waiting time was 6:23 Other days was 4:04

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Customer Support

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Customer Support

• Efficiency• Timely Manner• Preciseness • Formality• Manage customers expectations well

(Give & Take)• Know their computer literacy level is low

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Customer Support

• Managing Expectations – Communicate the level of service that is offered.

• Prefer field forms for email support.• Ask them to specify all configurations

• Auto-reply should be in Japanese as well.• Often time it is in English and goes Spam

folder.

Conclusions

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• Localize; Don’t trust translators – You must have industry expert for proof reading. Transparency is important to meet expectations.

• Design – What looks good in the West may not be attractive to the Japanese customer.

• Currency / Local market pricing - Present the price according to local custom

• Payment methods – Understand how Japanese prefer to buy, and offer them those methods.

• Quality Assurance – Don’t risk your reputation by not performing a thorough QA before bringing a product to the Japanese market.

• Customer Support – Understand what your support capabilities are, and be certain to communicate them clearly to customers with timely manner and transparency.

Conclusions

Navigating Japanese E-Commerce

Questions? @cleverbridge

#cbJapan

Craig VodnikVP of Marketingcleverbridge@craigvodnik

Yosuke ItoGeneral Managercleverbridge KK