When it comes to choosing a software vendor for a project in Japan, there are three types of customers.
Let’s see how they differ, which is more frequent, and what that means for a foreign IT company wishing to do business in Japan. It all boils down to defining which player bears responsibility for the decision…
In this short series, we will consider each of these Japanese customer types, starting with The Independent Thinker.
The Independent Thinker
When the time comes to start a new project that requires new software, Independent Thinkers will leverage their internal organization (IT department, CTO) to research and select a software vendor on its own. The company knows its own needs and will be able to find the solution that best matches its requirements and habits. The company culture empowers individuals and departments to take (reasonable) risks, allowing them to make their own decisions.
As a natural result of this organization, Independent Thinkers favor direct purchase, as they see no added value in a local intermediary that will take a margin without bringing much in return. A SaaS offer will be most welcome.
While Japanese language localization will be a requirement in most cases, the Independent Thinker might deem it OK to work with technical support in English.
For a foreign IT vendor, the Independent Thinker might look like the ideal customer in Japan. That may well be the case, except that this type of company represents less than 10% of the market in terms of sales. In addition to the fact that not many Japanese companies encourage independent decision-making, the typical Independent Thinker will be a small or medium company, with a lower sales potential as a result.
You could decide to exclusively target Independent Thinkers if it fits with your organization and products. However, for most companies, the Independent Thinker is the ideal customer for pilot projects: finding Japanese customer references is crucial to gain momentum. A small customer willing to take chances with a new player is exactly what you need. Ensure the experience of working with you is second to none, and they will gladly serve as a customer success story reference.