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Young People Search for Value

April 3, 2001
Even in the midst of an economic downturn, young women carrying top-brand goods can be seen on the streets of Tokyo. (Kyodo)

Consumers everywhere face various choices about what to buy every day. Recently young people in Japan are opting to buy products that help them express themselves, such as cellular phones, computers, and fashionable clothes and accessories. Members of the younger generation have shown themselves to be less hesitant to spend money than their elders. Interestingly enough, as these young consumers open their wallets, sales of both prestigious brand-name imports and low-priced goods are soaring at the same time.

A Run on Imported Brand-Name Goods
Leading brand-name goods from overseas are enjoying booming sales. Even when compared with the peak of the bubble economy some 10 years ago, growth in the sales of these items is several times greater today. One-third of the world's designer-brand goods are said to be sold in Japan. Because of this, companies that make these products are working to further expand their sales in Japan, and many opened large stores in fashionable areas in Tokyo last year.

In November 2000 Louis Vuitton opened a boutique in a famous department store in Ginza, an upscale shopping area in Tokyo. In the three days following its opening, some 15,000 people crowded into the boutique, forcing the staff to limit the number of customers inside at any one time. Sales were brisk: over 50 million yen (400,000 U.S. dollars at 125 yen to the dollar) per day. Louis Vuitton has been enjoying annual sales growth in Japan of about 10% for the past several years and is unable to produce enough goods to keep up with demand.

The boom in luxury items is not limited to Louis Vuitton. Perfume maker Chanel enjoyed annual sales growth of 12% in Japan last year. Jewelery sales are up, too: Tiffany saw 15% more sales during the period of August-October 2000 than during the same period in 1999. And Cartier improved its sales by 50% over the previous year.

Thrifty Is Popular as Well
The consumption patterns of these young people's parents and grandparents are somewhat different, however. Concerned about getting older and the possibility of corporate layoffs, members of the older generation are working hard to save money. In March 1991 individual financial holdings totaled 979 trillion yen (7.8 trillion dollars). But even after the collapse of the bubble economy, this figure has consistently grown. As of September 2000, the amount held by individuals had reached 1.4 quadrillion yen (11.2 trillion dollars).

Although they may be less hesitant to spend money than their elders, many young people are still looking for the best value possible. While brand-name imports are hot, domestically produced high-quality, low-priced items are also selling well. Examples of this trend can be seen in the popularity enjoyed by Uniqlo (Unique Clothing Warehouse) (Website in Japanese only), a brand owned by Fast Retailing Co. Uniqlo features items such as denim and fleece jackets at low prices. Business is booming: Sales are forecast to be up a whopping 45% over the previous year by August 2001. Also well received by consumers are 100 yen shops, shops filled with a variety of everyday products, all priced at 100 yen (80 cents). But products that fall in the middle of the price range, like Japanese designer brands, are continuing to struggle. It seems that younger consumers of late have taken the attitude that they will only buy the things they consider to have high value.

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Trends in JapanCopyright (c) 2001 Japan Information Network. Edited by Japan Echo Inc. based on domestic Japanese news sources. Articles presented here are offered for reference purposes and do not necessarily represent the policy or views of the Japanese Government.