Why Is Apple Dominating Japan's Smartphone Market?

Insaf Ali

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Over the past decade, Apple has ended up dominating Japan. Capturing 65% of their smartphone market, a number that Apple hasn’t reached in any other country, including the US. And that may seem a little odd considering Japan’s reputation for being the technological powerhouse of the world.

Igniting the MP3 player era with the Walkman, and inventing the pocket calculator, DVD player, the DSLR camera, laptop, blu-ray player, and more. Plus, Japanese people are known to try to buy products from their own country rather than those from overseas.

So how did Apple, an American company on the other side of the world, manage to dominate Japan; a country filled with tech products of their own?

There are quite a few reasons why Apple has done so well in Japan. Most of which are because of good business decisions they’ve made. But perhaps the biggest reason has nothing to do with Apple, and everything to do with Samsung.

You see, Apple has been battling Samsung in the worldwide smartphone market for years. Today, the two companies are neck and neck, with Samsung at 28% and Apple at 27%. But when you look at Japan, Samsung has captured just 6% of the market. While Apple is far and away from the most popular brand at 65%.

And Samsung’s poor showing in Japan is a result of a censorship campaign back in 2010. When they released their custom Android interface called TouchWiz 6.0, Samsung, a Korean company, decided to remove all references to Japanese culture.

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This was especially prevalent in the Emoji Samsung designed. As you may know, companies like Apple, Google, Facebook, and Twitter, are free to design their own emoji for their own platforms. That’s why they look slightly different depending on the smartphone or app you’re using.

But the guidelines these companies follow when designing emoji, are outlined by an organization called the Unicode Consortium. That way, the meaning of each emoji stays consistent across all platforms.

But with TouchWiz 6.0, Samsung took the unprecedented step of breaking from this standard.

For example, the TouchWiz Tokyo Tower emoji wasn’t illustrated as the standard red and white tower, but a generic gray tower instead.

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The Crossed Flags emoji, which are illustrated as Japanese flags on every other platform, instead featured South Korean flags.

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The Japanese Doll's emoji was changed to Korean dolls, and the Map of Japan emoji wasn’t even supported by TouchWiz. That meant the emoji appeared as a blank square if a friend sent it to you.

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No company had done anything like this before. And it became a popular news story in Japan, where tensions with Korea have been high since World War II. The censorship by Samsung completely destroyed their reputation in Japan.

Where customers try to support domestic products as often as possible and are unlikely to support any company at odds with the country. That’s why Samsung simply accepted the fact that their brand was unpopular in Japan, and stopped using their logo in the country entirely.

Opting instead to simply go by the name, “Galaxy.” Their billboards, signs, and commercials never feature the Samsung logo. Their huge retail location in Tokyo is called the Galaxy store.

Their website domain is galaxymobile.jp. And when you buy a Samsung product in Japan, they don’t even put their logo on the box. But despite their best efforts to rebrand, most Japanese customers have continued to boycott Samsung.

Now, this is where Apple comes in. Steve Jobs happened to have a soft spot for Japan even before the iPhone was invented.

Sony, a Japanese company, happened to be the consumer electronics brand he respected most. In fact, Jobs tried persuading them to allow their popular VAIO notebook to run the Mac operating system. This is pretty high praise, considering Jobs had spent the last three years shut down the Mac clone market.

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But the VAIO team opposed the idea since the product was optimized for Windows and already selling well.

Jobs also loved traditional Japanese architecture. Taking each of his children on a trip to Kyoto to share his admiration. And as it happens, his iconic black turtleneck was designed by Japanese fashion icon Issey Miyake.

The first international Apple Store was built in Tokyo, back in 2003. So there was no shortage of friendliness between Apple and Japan.

And when the iPhone debuted there in 2008, Apple entered the market with a strategy. They partnered with SoftBank, one of the country’s three major mobile carriers, to offer the iPhone exclusively.

Now, at the time, SoftBank was the smallest of Japan’s carriers. And that worked out well for Apple since they ran the most aggressive mobile phone promotion in the country’s history to attract more users.

Offering an iPhone for free with a two-year contract. This not only helped SoftBank’s growth but Apple’s as well. Since their phone was one of the cheapest on the Japanese market.

Something we in America rarely experience since iPhones never go on sale. But Apple’s strategy was important for two reasons:

First, was that many analysts didn’t expect the iPhone to appeal to Japanese customers.

Mainly because smartphones in Japan were focused on including as many buttons as possible. Since that meant more features and functionality, which the iPhone lacked.

Second, the Japanese mobile phone market was extremely isolated. With Japanese companies designing phones to be sold exclusively in Japan. This led to the term Galapagos syndrome.

Where companies like Sony, Panasonic, and Sharp would dominate the phone market in Japan, but fail in other countries.

Based on this isolationism, it was extremely difficult for foreign electronics companies like Apple to make inroads and become an established brand. But that turned out not to be the case at all.

In fact, Japanese customers' response to the iPhone was overwhelmingly positive. And I think it’s for the same reason people all over the world loved iPhone. It allowed you to do so many things, so easily.

And although Japan had and continues to have a high presence of feature phones, it’s become a niche market.

Since the iPhone offers perhaps the most important feature of all for Japanese customers, and that is convenience. Not to mention the aesthetic that Japanese companies often strive for has been part of Apple’s culture since the beginning.

Simplicity, ease of use, and attention to detail are things many people in Japan value. And they’ll pay a higher price for a product that delivers on those qualities.

But now you might be thinking, what about Japanese companies like Sony and Sharp?

Why aren’t customers buying their phones instead?

And the answer is that they were simply too slow to adapt. When the iPhone hit the Japanese market, domestic phone companies expected it to flop, and continued to release feature phones that had proven to be successful in the past.

Once the iPhone became a clear market leader, Sony, Panasonic and Sharp all tried to compete. Releasing their own multi-touch devices, although none could exceed the high quality and low price of the iPhone especially while SoftBank was running such aggressive promotions that domestic phone companies couldn’t take advantage of. So that is how Apple dominated Japan.

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