Posted : 2013-08-26 17:41
Updated : 2013-08-26 17:41

Samsung, LG seek big break in Japan

Samsung Electronics' Galaxy smartphones are displayed at a booth at Akihabara, the biggest wholesale market for consumer electronics in Tokyo, in this file photo. The technology giant is seeking to expand its presence in Japan's smartphone market. Japan's biggest mobile carrier NTT DoCoMo sells Samsung phones there. / Courtesy of Samsung Electronics

Tech giants try to capitalize on hallyu

By Kim Yoo-chul

TOKYO ― The Japanese market is probably the toughest to penetrate for both Samsung Electronics and LG Electronics. The strong pride of Japanese consumers in their national brands is restricting market space for Korean brands.

While the two technology giants are well-known global players and sell their products in almost every country, they have failed to expand their presence in Japan and are still considered underdogs there.

Now they are seeking to find a breakthrough in the neighboring market dominated by its own brands, such as Sony, by capitalizing on hallyu or The Korean Wave that have made Japanese consumers pay more attention to Korean products.

The duo is now focusing on the lucrative smartphone market.

Representatives at Samsung and LG said the companies are having difficulties raising their presence in Japan but that they won't abandon the market.

This is because favorable reviews by more critical Japanese consumers make the companies more confident about their brand profiles and the quality of their products.

While Samsung is the world's biggest smartphone manufacturer, the company is not among the top five in the Japanese smartphone market, which is led by Apple, Sharp and Sony.

LG is the world's second-biggest TV manufacturer but its share in the Japanese television market remains less than 4 percent, said company officials.

"I know about Samsung Electronics. If given the chance, I may buy Samsung products, but honestly, I probably won't. Samsung has hurt the national pride of Japan. I can say that Samsung is a very trusted brand, but I don't know whether I should buy Samsung products. This is a sentiment-related issue," said Tatsuzawa Mai, a 29-year-old office worker at another Bic Camera in Akasaka.

The Korean technology heavyweights are struggling to gain traction in Japan but are gradually performing better with the popularity of Korean TV dramas and shows, and K-pop groups such as Kara.

"Although many are still unsure of whether Samsung and LG's rising popularity in Japan will last, Korean brands are seeing improved indicators for their businesses in Japan," said a sales clerk at a Bic Camera outlet in Shibuya, one of the busiest shopping districts in Tokyo in an interview with The Korea Times.

Impressed by hallyu, younger Japanese consumers are paying more attention to Korean brands.

Some also say a growing number of Japanese are starting to treat Samsung and LG Electronics as fashionable brands whose products have appealing technologies.

"As far as I know, Samsung and LG Electronics have been aggressively hiring marketing experts from Sony and Panasonic. By hiring them, Korean brands aim to place more of their products in major electronics retailers including the biggest, Yamada Denki," said a tour guide who wants to be identified only by his surname, Kim.

Since 1995, Kim has been living in Japan. As a tour guide, he has many well-known corporate clients.

"What's interesting is many marketing employees from Sony and Panasonic have joined either Samsung or LG to help them develop strategies tailored to the Japanese market," he stressed.

Kim said "sentimental reasons and significant confidence in the advanced technologies of Japanese companies for decades" are the biggest challenges to the expansion of Korean businesses in Japan.

"Japanese people are passive when it comes to changing their buying habits. The influence of Korean culture and providing competitive technologies with better pricing are some tactics that may encourage the Japanese to change their buying patterns," Kim added.

The mixed reviews of Apple iPhones can also be a positive sign for Samsung to up its stakes in the Japanese smartphone market.

NTT DoCoMo, the only Japanese mobile carrier that supplies Samsung smartphones, sold 400,000 Galaxy units, according to data from IDC, a leading market research firm.

Meanwhile, NTT sold more than twice as much of Sony's Xperia mobile phone.

"Although the number itself wasn't that impressive, Samsung is gaining confidence," said an official at Samsung in Seoul.

"Samsung and LG are successful in the global market because their models, large-scale production and price advantage are increasingly favorable to the sellers. Every other company is now learning from the Koreans in this regard and are trying to follow them," said an official at the Korea Trade-Investment Promotion Agency in Seoul.

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