Academic journal article Public Relations Journal

U.S. Firms Take Varied Approaches to Japanese Market

Academic journal article Public Relations Journal

U.S. Firms Take Varied Approaches to Japanese Market

Article excerpt

U.S. Firms Take Varied Approaches To Japanese Market

US. and a few British firms are taking a variety of approaches to establishing public relations operations in Japan. Some are starting joint ventures with Japanese consultancies, others are buying into Japanese firms. Still others, often linked with advertising and communications giants, are forming global networks.

Stepped up activity in public relations goes far beyond the "letterhead links" between U.S. and Japanese firms that have existed since the late '50s. While there are some "stand alone" U.S. and British operations in Japan, these may not be as likely to succeed. Reasons include the inherent Japanese propensity to do business with their own people as well as formidable cultural, language, political and media differences in the two countries.

Innovative tie-ins include Burson-Marsteller's new partnership with Dentsu, the world's largest advertising and communications conglomerate. Hill and Knowlton's link with Sumitomo Corporation brings the U.S. firm contact with 50 leading Japanese companies. British-owned Shandwick, #1 in worldwide public relations billings, has recently purchased International Public Relations, based in New York City, to become a major player in Japan. Manning, Selvage & Lee has joined forces with two Japanese firms, Tokyu Agency International and Kyodo Public Relations to form Tokyu MS&L.

Centered in Tokyo

While no exact ranking of Japanese firms is possible, partly because practitioners don't want to report fees or figures, there is consensus on the major players. The largest domestic firm is Dentsu Public Relations, claiming 140 employees. IPR has about 90 employees, as does Kyodo; Cosmo Public Relations Corp. has 60, Dentsu B-M about 45 and Hill and Knowlton exactly 20.

Virtually all public relations firms are in Tokyo, largely because, in a country of 120 million people, virtually all corporate headquarters and media are in the capital.

Fees and expenses for public relations services are roughly comparable to those in the U.S. or U.K., practitioners said. But Japanese firms face far higher out-of-pocket expenses due to Japan's extremely high cost of living and the extent of entertainment clients expect.

"We prefer retainers to project clients," one firm head noted, "But we don't get as much (retainer income) as we'd like." Working mostly on projects makes it "impossible to build corporate image and status -- the ultimate aim," he complained.

Those firms securing retainers generally use the U.S. system of fees set in advance against hourly billings. This works quite well for U.S. and Western accounts. But the Japanese want fees determined at the year's start with no increases during the year, even though the work may be far greater than expected. Japanese clients are also slow to increase annual fees.

Firms with U.S. ties and clients are profiled below.

GAVIN ANDERSON & CO. [JAPAN]

Affiliated with Gavin Anderson & Co. (New York), this firm has operated in Japan since 1985. Although Gavin Anderson & Co. (New York) was recently purchased by Omnicom, it remains independent. Staff numbers 13: three from the U.S., two New Zealanders and one Australian, all fluent in Japanese, plus local staffers proficient in English.

Services: Specialists in corporate and financial campaigns and marketing counseling.

Selected Clients: Boise Cascade, Coca-Cola Japan, Salomon Brothers Asia, VISA International, Reuters.

Case Histories: To boost awareness among financial journalists of many types of securities and their markets, experts of Salomon Brothers Asia designed study sessions. These sessions built goodwill with the financial press and eventually resulted in enhanced visibility for Salomon via published interviews and mentions.

VISA International sponsored events involving Japanese athletes linked with local sports establishments to promote its sponsorship of the Seoul Olympics. …

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