Author: Jacques Quass de Vos
Anime, sushi, city pop, and Pokémon: what do these Japanese things have in common? The answer is rather clear, right? Add the likes of Mitsui, Hitachi, Sony, and Toyota to the list. Now include JICA (Japan International Cooperation Agency) and JETRO (Japan External Trade Organization). How about the 2020 Olympics? The answer becomes a little cloudier…
Soft power – a term coined by Joseph Nye in 1990 – is used to describe one country’s ability to use non-aggressive means to co-opt another to act in a certain way;[1] alternatively, hard power is the use of military or economic tools with a focus on coercion. Japan gained considerable soft power following its economic boom in the post-war period. It was certainly a more effective and peaceful strategy for international influence than its military state in the early 20th century.[1]
Culture: A Significant Source of Japan’s Soft Power
Through the global proliferation of Japanese art, cuisine, and pop culture,[2] the country has amassed global support from the most fundamental base of foreign governments: its citizens.
McGray, as early as 2002, was the first to jokingly refer to these exports as “Japan’s Gross National Cool.”[3] The author further related the country’s cultural successes as a reinvention of the traditional model of “international superpower,” and finally argued that Japan’s “cool” had helped it stay afloat in spite of the country’s economic turmoil that started in the 1990s.
While it is bold to attribute the aversion of a serious economic crisis to a country’s cultural exports, the status of brands such as Pokémon is immense; it currently stands as the highest-grossing media franchise of all time, amassing almost US$100 billion of total revenue. Hello Kitty comes in second place and both brands are beloved household names globally.
Although these brands certainly are staples of Japanese pop-culture, merely propagating their popularity is not the cornerstone of the Cool Japan strategy. Instead, the strategy entails the commodification of a national identity.[4] Still, the need to capitalise on the revenue potential of Japanese coolness was starting to be expressed by business and government in the country.
Therefore, “Cool Japan” (CJ) became an official governmental policy framework designed to promote Japan’s image abroad.[5] As soft power can be likened to a private enterprise’s brand image – an intangible (and, in some cases, invaluable) strategic asset, the CJ strategy should be considered a nationwide marketing scheme.
“Cool Japan” as a Policy Framework
The policy has two explicit goals: (1) to boost cultural exports, and (2) to present a positive international image. It is facilitated by a range of governmental institutions.[6] Cool Japan saw its official initiation in 2010, with the establishment of the Cool Japan Promotion Office within the Ministry of Economy, Trade, and Industry (METI). However, many understand the general mandate was launched as early as 2002 through the establishment of a new Intellectual Property Strategy Headquarters (IPHQ).
Under the leadership of former prime minister Shinzo Abe, the cabinet saw the inauguration of a dedicated Minister in charge of the CJ strategy in 2012.[7] In the years that followed, the CJ Public-Private Partnership Platform, the Regional CJ Promotion Council, and several cross-ministerial organizations were established.
General Trends Following the Strategy’s Launch
Certainly, the CJ strategy enjoyed some success. From 2012 to 2018, foreign tourist arrivals saw a 370% increase with foreign tourist consumption value increasing by 420%. Exports of Japanese alcohol, koi carp, and rice rose by 300%, 160%, and 500% respectively.[8] Interestingly, the influx of tourists and exports of Japanese food-products are just a byproduct of the real focus of the CJ strategy.
A major focus of the strategy remains the content or creative industry (film and other media) as a leading industry of the Japanese economy.[9] As there are contradicting perspectives to the measurement of the cultural or content industry (as well as within subcategories such as anime too), it is quite difficult to measure the exact growth and success of the Cool Japan policy.
Research by Kakeuchi and Takeuchi (2014) attempts to rectify definitional issues by providing the exact scope of their understanding of “creative industries.”[10] Their definition – based on the ones provided by the UK’s Department for Culture, Media & Sport and Japan’s METI – essentially states that the creative industry is one which lends itself to individual creativity, skill and talent, creating wealth and jobs through the generation of economic and intellectual property. This view includes spin-off items such as merchandise, jewellery, stationery, and toys.
Japan’s creative industry sales revenue (in 2010 terms):[10]
- 1999: 51.4 trillion yen
- 2004: 45.2 trillion yen
- 2011: 44.1 trillion yen
- Total growth (1999-2011): -14.3%
Figure 1: Sales in billion yen by creative industry subsector (1999-2011)
Sales by creative industry subsector. Graph by Jacques Quass de Vos.
Note: Graph is interactive. Double-click to reset.
As shown in Figure 1, nearly all subsectors of the creative industry saw a decline in the 12 years between 1999 and 2011. However, software and computer services saw a strong 66.4% increase with TV and radio (the only other growing sector) increasing by 17.2%. Interestingly, manufacturing creative industries declined much more rapidly than service creative industries, although, massive sales losses were experienced in advertising and architecture too.
Based on estimates from 2010 to 2012, the creative industry accounted for 4.2% of total employees, 3.3% of total sales, and 5.3% of total value added to the overall Japanese economy.[10]
Statistics from different sources, however, often contradict one another, as a 2021 Deloitte report claims that Japan’s creative industry accounted for 9.9% of Japan’s total employment in 2011, growing to 11.9% in 2018.[11] While Deloitte’s definition of the industry is almost identical to that of Kakeuchi and Takeuchi, Deloitte adds an interesting phrase to their definition, asserting that those working outside of creative industries, but still work in creative occupations should be included in statistics. Following this rationale, engineers and a plethora of other occupations should be considered, allowing consideration of a much broader (and obscurer) workforce.
These statistics underlined two key points: (1) the creative industry needed more focus on the tertiary side, as opposed to manufacturing; and (2) the creative industry – in decline at the time – was of major economic importance to the economy’s future. These points, among others, supported the rationale for the CJ strategy and its related fund, the CJ Fund Inc.
CJ’s Struggle to Deliver Results
The CJ investment fund, established in 2013, was intended to support the overseas expansion of Japanese cultural products. However, while the popularity of Japanese pop culture certainly increased in the years following the establishment of the CJ strategy, cultural export revenues have not seen significant increase.
In 2022, the CJ strategy – particularly, the CJ Fund Inc. – found itself under pressure from the media, as it was reported that it has accumulated deficits. At the end of the 2020 fiscal year, the fund had amassed losses of 23.1 billion yen.[12] These losses, although exacerbated by the Covid-19 pandemic, rose further to 30.9 billion yen in late 2022.[13] This result comes despite the CJ Fund being awarded over 106 billion yen as of March 2022.
Commenting on these losses, a senior government official reportedly questioned the effectiveness of the CJ strategy, asking “Who talks about Cool Japan now?” and stating that “Korean culture took it over.”[13] When the CJ strategy first became an official public mandate in 2010 – or even 2002 – Matsui wrote about the stigmatisation of the strategy and pop culture products among central ministries.[14] Clearly, the bureaucracy seemed unable to shed these dated perceptions and capitalise on the huge potential of creatives.
However, according to Kawashima, the lack of success in the initial years of the CJ strategy may be attributed not only to the scepticism and lack of enthusiasm from governmental departments but also to the complacency of Japanese companies themselves.[15] Kawashima identified four primary concerns private entities had, hindering their ability to successfully export cultural products:
Intellectual property concerns: Media and entertainment (e.g., anime producers) had concerns surrounding copyright law enforcement in Asian countries, in particular Southeast Asian countries such as Vietnam and Indonesia. As these countries had unsatisfactory supply of their own in these sectors, it presented a great opportunity for Japanese producers; however, Japanese companies feared their products would be exposed to piracy – ironically enough, their products were pirated in any case. Piracy was rampant in the US and helped create a demand for Japanese-made media, but the owners of these products were sluggish in turning the demand into official distribution (hence revenue) streams.
Marketing expertise and cultural sensitivities: At the time (and to this day) Japanese media and entertainment franchises – apart from some giants such as Nintendo – have a lack of marketing and intercultural communication skills. Likewise, business skills and experience in dealing with international media companies and intermediaries will continue to hold back Japanese companies that do not invest in this kind of expertise.
Financing scheme challenges: Larger scale productions are often financed through ‘production consortia’ or committees which has benefits domestically, but poses significant barriers for efficient decision making with stakeholders abroad. The lack of a central power in these consortia obstructs effective negotiation.
Profit generation in emerging markets: As Korean productions gain dominance in Asia and elsewhere through tactful pricing (keeping prices low with the intent of raising it at a later stage), Japanese content industries face challenges in keeping up with competition.
It is recommended that Japanese content industries address existing issues and new ones opened by alternative distribution channels and continued digitalisation of content to remain relevant. While this short analysis has mainly focused on the beginning stages of the CJ strategy, data availability remains a challenge in analysing more recent developments. It is further recommended that local and international stakeholders standardise measurements of the relevant industries to aid economic impact analyses and future policymaking.
Saliently, however, a positive image of Japan’s cultural goods has certainly been propagated extensively in Asia and far beyond; on the other hand, the CJ strategy has failed to turn this into tangible results (other than, perhaps, an influx of tourists). The experience of other countries, like South Korea, which has adopted similar soft power promotion policies through cultural items such as K-Pop, might be instructive.
REFERENCES:
[1]Nye, Joseph S. “Soft Power.” Foreign Policy, no. 80 (1990): 153. https://doi.org/10.2307/1148580.
[2]Carminati, Daniele. “The State of Japan’s Soft Power after the 2020 Olympics.” E-International Relations, August 13, 2022. https://www.e-ir.info/pdf/98787.
[3]McGray, D. 2002. “Japan’s Gross National Cool.” Foreign Policy, (130), 44. https://doi.org/10.2307/3183487.
[4]Tamaki, Taku. “Repackaging National Identity: Cool Japan and the Resilience of Japanese Identity Narratives.” Asian Journal of Political Science 27, no. 1 (2019). 108-26. https://doi.org/10.1080/02185377.2019.1594323.
[5]Cabinet Office, Cool Japan Proposal (2014). https://www.cao.go.jp/cool_japan/english/pdf/published_document3.pdf.
[6]Garvizu, N. 2018. “Cool Japan: The Relationship Between the State and Cultural Industries.” (PhD thesis). University of Sheffield, Sheffield. Accessed August 19, 2023. https://etheses.whiterose.ac.uk/16405/.
[7]Cabinet Office, Cool Japan Strategy Public-Private Collaboration Initiative (2015). Accessed August 21, 2023. https://www.cao.go.jp/cool_japan/english/pdf/published_document2.pdf.
[8]Intellectual Property Strategy Headquarters, Cool Japan Strategy (2019). https://www.cao.go.jp/cool_japan/about/pdf/190903_cjstrategy_english.pdf.
[9]Matsui, Takeshi. “Nation Branding Through Stigmatized Popular Culture: The ‘Cool Japan’ Craze Among Central Ministries in Japan.” Hitotsubashi Journal of Commerce and Management 48 (2014). https://www.jstor.org/stable/43295053.
[10]Kakeuchi, Emkiko, and Takeuchi, Kiyoshi. “Creative industries: Reality and potential in Japan.” GRIPS Discussion Paper, no.14-04. (2014). Accessed September 16, 2023. https://www.grips.ac.jp/r-center/wp-content/uploads/14-04.pdf.
[11]Deloitte. 2021. “The Future of the Creative Economy.” Accessed September 16, 2023. https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/technology-media-telecommunications/deloitte-uk-future-creative-economy-report-final.pdf.
[12]Tsutsui, Ryuhei. “Cool Japan Fund may be merged, eliminated if it does not improve.” June 21, 2022. Accessed September 17, 2023. https://www.asahi.com/ajw/articles/14650109.
[13]Wakai, Takumi. “Cool Japan Fund teeters on its last legs after losing 30 billion yen.” The Asahi Shimbun. November 22, 2022. Accessed September 17, 2023. https://www.asahi.com/ajw/articles/14774650.
[14] Matsui, Takeshi. “Nation Branding Through Stigmatized Popular Culture: The ‘Cool Japan’ Craze Among Central Ministries in Japan.” Hitotsubashi Journal of Commerce and Management 48, no. 1 (48) (2014): 81–97. http://www.jstor.org/stable/43295053.
[15]Kawashima, Nobuko. “’Cool Japan’ and Creative Industries: An Evaluation of Economic Policies for Popular Culture Industries in Japan.” Asian Cultural Flows, 2018, 19-36. https://doi.org/10.1007/978-981-10-0147-5_2.