Hasta La Gadget!

This is the latest in a series of blogs based on the newsletters supplied by our research partner INterRIDE Inc.

2011 First Quarter Results for SNS Ad Sales

The numbers are in for the first quarter of 2011 and, although there were some effects from the March 11th earthquake and tsunami, sales and profits were up for the main social media players compared with the previous period. Mixi alone experienced a slight drop, perhaps suggesting that local users prefer games on GREE (who had a jump of 14%) and Mobage in these evolving times.

ARPU for SNS like mixi and Ameba is stronger due to their solid PC base. However, unlike gaming portals like Mobage and GREE the amount they can get from membership charges is very low (or zero), and INterRIDE speculates that as Ameba particularly develops its own games it will be able to turn these into cash.

All 4 major SNS (mixi, Mobage, GREE and Ameba) are seeing a decline in their feature phones membership and, predictably, an increase in smartphone users. This does not surprise given that some estimates show that smartphones make up 47% of all units currently shipped in the country.

Future Prospects for Japanese SNS

Of all the main players, mixi is distinct in that it is essentially only aiming for a domestic member base, and that on paper it’s most obvious competition is not even GREE, Mobage and Ameba — but Facebook. It currently has a strong female and student user base but INterRIDE believes that forthcoming services will focus more on businesses.

GREE’s success has overtaken Mobage and part of the reason may be down to its quicker response to smartphone opportunities. It now offers full data portability and, by partnering with OpenFeint overseas and its 75 million users, it is also aiming to be the world’s largest smartphone platform.

DeNA’s Mobage has invested in lots of TV advertising and its own games to generate revenue, as well as working with subsidiary ngmoco to push itself overseas. Meanwhile CyberAgent’s Ameba should start to concentrate on its iPhone platform GameWave as a way to catch up with the other gaming sites.

Mobile Suica for Android

JR East announced on May 23rd that train smartcard service Suica would become available on Android phones from July for models from all three carriers, NTT DoCoMo, au KDDI and Softbank.

The Suica of course is the transport-focused e-money service that can be used as a physical IC card to charge up and pass through ticket barriers in stations, as well as make payments at vending machines and normal stores (especially kiosks and convenience stores inside the stations).

We’ve talked about this so much over the years but it really is true: Japan led the world with integrating Suica (and other e-money) into mobile devices, with osaifu keitai (literally “wallet phone”) services meaning you could scan your cellphone on the barriers or reader at the shop counter.

With some 24 million users across Japan already using Mobile Suica, this not unexpected development means that even those with swanky new phones will still have access to this lifestyle tool so integral to local commuters.

Smartphones are for Girls

CyberAgent subsidiary CyberCasting & Pr have launched a smartphone app review site for girls. Girls Appli Navi makes use of 150 dokusha models (literally “reader models”: ordinary girls moonlighting as models) who give assessments on iPhone and Android. The models represent major fashion magazines like CanCam, AneCan and ViVi.

As the smartphone market expands in Japan it also morphs more and more with local fashion trends, and the key drivers are of course female consumers. Already we saw a “mook” magazine guide released this spring, WE Love SmartPhone, clearly intended for uber-kawaii fans, complete with a free Hello Kitty iPhone4 cover and produced by the fashion magazine S Cawaii!

Androidoll went online a month before Girls Appli Navi and seems more ambitious (despite only being for Android). It too offers reviews of apps and rankings based on the views of female models, but you can also create your own origin apps (photo albums, clock gadgets etc). These sites will no doubt prove valuable resources for market researchers like us when playing detective re. female mobile needs!

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We recently introduced you to gardening in bottle tops here in Japan and at the recent Interior Lifestyle Tokyo Expo we came across gardening in books!

The folks at Japanese company Green Supermarket have come up with a cute way of encouraging Japan`s green fingers. With space at a premium in Tokyo and a large proportion of residents living in apartments it is difficult finding any space to grow anything, especially when your apartment doesn’t even have a balcony. The company has come up with ways to utilise residents book cases, table tops and a variety of small spaces. One of their products, Green Story, from the outside looks like an every day book, however when opened it reveals a cute “pop-up” garden complete with pictures and story with a small herb or plant crop.

The “plant books” come in different designs and each have a small story and message written in the cover of the book that fit with the depicted scene. Once the cress has grown a little it can be harvested bringing new meaning to “eating your words”!

Another product form the company is Green Dish, what looks like a simple milk carton when lifted up reveals a small “garden” of cress. The packaging is very nicely designed and is a feature in itself, with soft pastel colors that can decorate tables or kitchen areas.

The products are another example of how Japanese designers are particularly imaginative and innovative in maximizing how they use the small spaces people live in. Although it is a long way from a full meal, with the rise in the public’s interest in where their vegetables and fresh produce comes from since the disasters in Japan, ideas similar to this could become popular allowing residents to grow some of their own food despite the lack of space.

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Japanese advertising giant Dentsu today announced the launch of the designated official website for the Kibo Robot Project today, which aims at putting a communicative robot into space by 2014.

As of today the website is open for the public to enter their messages which the robot will carry into space to be read out to astronauts. Messages of encouragement and simple communication from the public around the world are aimed at boosting the emotions of the astronauts who will be living on the Japanese Experiment Module, aboard the International Space Station that will orbit earth. Messages can be submitted via twitter or email and there is a ready made logo users can download to add to their Twitter avatars also. Visitors to the site can also browse other messages of support before adding their own.

The site also links to a twitter account, @space_GAL , which will give regular updates to the projects events, and in male dominated Japan it is interesting that the creators have chosen a female figure to be the official twitter reporter. Trying to make the project more “approachable” the idea is to widen the reach of the project to demographics that wouldn’t normally be interested.

The collaboration effort between Dentsu, JAXA, University of Tokyo and Robo Garage is not only aimed at the space program however, but with the wider aim to “help solve the social problems of the future through communication”. With the growing aging society in Japan and a rise in social problems the whole project is trying to address future concerns regarding a lack of communication in a “society of singletons.”

Thanks to Plastic Pals

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Japanese mobile service provider NTT Docomo announced an update to their bike sharing scheme, called Interstreet, at the recent Wireless Japan exhibition held this week in Tokyo.

Earlier in the year the company teamed up with Japanese company Pedal for a trial service whereby the public could locate and rent bikes from their phones. The new update includes a specifically designed app for Android users and new docking stations allowing a number of different payment methods and more bikes equipped with GPS tracking.

To rent the bikes users touch their Osaifu Keitai (wallet phone) enabled mobiles to the sensor pad on the machines and register their phone number and mail address on the touchscreen display. A confirmation mail is then automatically sent to the phone which users then touch to the locking mechanism. The lock automatically unlocks and the cyclist can then take the bike, the time is registered by the service and on the users phone. Those without FeliCa phones can use either a credit card or another emoney payment system.

The bikes have a holder for the Android phones mounted on the handle bars to make use of the free, specially designed app for the service, COSOADO. The app gives the user map information, highlights local attractions and shops, suggests routes and uses GPS to track where and how far the cyclists pedal. It can also display health information such as how many calories burned during the cycle and the route taken.

Once finished with, the bikes can be left at any of the other bike stations around the area, meaning that one way trips are also possible. Users are then charged automatically, via emoney from their registered phones, based on how long they have used the bikes for.

The health and wellness market is a growing sector globally and tying in smartphone capabilities for a more enhanced experience is an obvious update from Docomo. It would be nice if it could be tied in with a social service such as foursquare or twitter also, users could for example then compete with others for the most distance cycled or areas visited. It would have been simpler also if the whole registration process could have been done via the Android app, without having to go through the different steps each time users want to rent a bike. The key to how useful the service is though will depend on how widely it is implemented, and it would also be nice to see more initiatives made by the government for cycle lanes and paths, of which there is a distinct lack of at present in the city.

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This is the latest in the series of blogs based on the newsletters supplied by our research partner INterRIDE Inc.

Post-Earthquake SNS Trends

In an online survey of 1,891 social media users 1.9% answered that they started using Twitter due to the March 11th earthquake. Combined with those who already were using the service the total rises to 42.1%, almost double that of Facebook and not far from mixi’s 50.8%.

The same survey also asked users which SNS they found helpful following the catastrophe, and 63.9% said Twitter, against Facebook’s 34.7% and mixi’s low 26%. As Asiajin blogger Akky Akimoto wrote in a recent Japan Times column:

As mobile phone networks went down after the quake, people turned elsewhere to contact each other, and Japanese TV and newspapers suggested that social media, which by then basically meant Twitter, was a good alternative when disaster cut off other communication channels.

Figures show that the number of tweets on March 11th was 1.8 times higher than usual, and continued to be 20% higher than average in the weeks following the disaster.

Of course most people still got their information immediately after the quake from TV, not least because internet was not available at many places such as refugee shelters. However, the survey also revealed that television is still the most trusted medium overall and SNS and blogs are the least, even though their usage is very high among people in their teens and twenties.

These results are not surprising but it’s good to have some confirmation of how users were searching for information in the wake of the disaster. Though much in the media has been made of the population’s stoicism, attitudes will be affected, not only as regards social media but also in terms of general consumer behavior, as we researched in our new in-depth video report on “Japan’s new normal”.

Japan carriers unlock SIMs

It got sidelined understandably following the March 11th earthquake and tsunami, but a minor mobile revolution occurred when on the same day NTT DoCoMo officially announced it would allow SIM unlocking on its new phones, for a small fee.

For the first time in Japan we see the possibility of a separation between the phone and the payment plan. Despite leading in so much of its mobile technology Japan has arguably lagged in its services (or at least, their flexibility) compared to the rest of the world. It wasn’t just the carriers’ fault since the manufacturers were also reluctant to take the leap, worrying about the additional customer service costs it would incur.

Of course we still seem to be some time away from Softbank unlocking their iPhones and iPads, though ironically government pressure on the carriers to deactivate SIM locking was likely motivated by the arrival of the iPhone. In 2008 overall mobile phone unit shipments dropped by 18.7%; clearly something had to be done to stimulate growth again. The introduction of a wave of foreign and domestically manufactured smartphones is one step but this new development will likely be positive for sales too.

INterRIDE speculates that the influence on mobile marketing and advertising could be big, but at first we will have to see what kinds of users opt to unlock their phones and go free.

BitCash and mobage

In an interesting example of a tie-up between an e-money tool and online platform, gaming portal mobage was offering users the chance to exchange their BitCash for the site’s own points. BitCash is a “web money” that if purchased at Seven Eleven, could then be changed into “moba-coin”, mobage’s internal points, and 10,000 further users received 200 coins by lottery.

Quite a lot of this point-exchange goes on in Japan and it’s a great example of how services work together to offer loyalty deals to the widest possible number of consumers. Portals like G-Point or ChobiRichi allow people with points from Yahoo! or Rakuten to switch them to others either more specific (ANA miles) or general (T-Point, Edy, Suica etc.).

BitCash is used for online gaming, betting on the horses (one of the few cases of legal gambling in Japan), paying for digital music, or e-commerce.

KDDI opens book store

The shop in question is of course a digital one and ties into KDDI’s other entertainment services. Lismo Book Store is hoping to rival foreign e-book and digital publishing providers, and is specifically for KDDI au’s Android smartphone (much like the Lismo music services are for au users).

KDDI first started offering e-book services last December for its bible Leaf SP02 model but in April expanded it for the Android IS03, also adding SNS-style functionality such as user reviews. In the kind of analog touch that I personally love your downloaded texts are displayed on a “bookshelf” interface. Currently Lismo Book Store has around 30,000 titles for users, to increase to around 100,000 through 2011.

Japanese publishing is famously highly diverse. Whenever local bestseller rankings are compared with America or Europe, the proportion of fiction is quite a bit lower, with a much broader range of hits, including manga, self-help books, idol photo books and so on. It will be interesting to see if the digital book stores mimic this trend and if it affects the established keitai shosetsu (mobile phone novel) phenomenon, which accounted for around half of bestsellers at its peak in 2007.

Green-Fingerer Tweets

Finally, we all know that local users love anything cute.

Hakuhodo has got together with researchers from Keio University’s media design faculty to create fulife, a Twitter iPhone app that lets you grow flowers with your tweets. When you write messages you can plant seeds and rain then falls, making your garden come to life. This “flower communication” tool also allows you to pick your sproutings and send them as presents to your Twitter chums.

Twitter has seen success in Japan (even not taking into account its role in post-3.11 communication) but Hakuhodo is worried about its longevity, it seems, so this app is part of the Sustainble User Generated Media Project: How can we ensure that people continue using the platforms and contribute, especially in the Japanese market where typically users are highly reluctant to get personal?

Presumably making a cute environment that gets cuter the more you tweet is one solution. Revealing the target is supposed to be anyone from ages 5 and up to adult — quite a range!

You can do a quick search for who is using this app by looking at the Twitter tag #fulife.