How to B2B: Your Japanese Psyche Guide to Sales
Here’s part 2 of the of the points covered in the Wahl+Case podcast episode with Bryan Rios, discussing how to do B2B sales in Japan, essential cultural aspects to learn, and practical tips based on my years both doing B2B sales as well as working adjacent to sales teams at Softbank Robotics and Ricoh.
Listen to the full conversation with Bryan here:
Subscribe to the Wahl+Case podcast for upcoming episodes where Bryan and myself will discuss, in-depth, how to B2B in Japan:
For a very long time, IT solutions—especially for B2B companies—were extremely expensive custom-made systems.
Consultants would come to the firm, interview everyone, ask about how these processes were being done manually, where the data is stored, who inputs what data, and whatnot. And then they would create this chart of the whole process and say, “Okay, now we’ll build a system for that.”
And once it was done, because it was such a customized system, the company would need customer support and maintenance, too. Of course, all of this was labor intensive, and these IT companies would make a lot of money by charging an extremely high annual (support &) maintenance fee of hundreds of thousands of dollars.
The reason I’m explaining this is that this type of relationship created a culture where the customer says, “You make your system work for me. You adjust your system to make it usable for my company.”
Going to the tailor or shopping from the rack?
IT solutions used to be like going to a tailor for a tailored suit.
For example, the tailor would come to your place, or you would go to the tailor. They would measure every part of you and they would make the perfect suit that fits you. And if you went up or down a size, the tailor would adjust the system. But, of course, every time you had an appointment with your tailor, you would pay a lot of money. And so only the rich people were able to buy suits.
Nowadays, everyone wears suits, but the majority of people don’t buy tailor-made suits. Instead, they go to a store and just pick a size, S, M, or L. It’s not bespoke, but it works. And in a way, SaaS is just like that. SaaS is like the UNIQLO of IT solutions.
SaaS is like the UNIQLO of IT solutions, but not everyone wants UNIQLO
Basically, if there is a company that says, “In order to solve my problems I need to buy [X],” they go to a store and they pick S, M, or L, based on the company size or the business size that they need. Perhaps you’re a bigger M-size, so size M doesn’t really fit, and you have to buy L size, which involves a redundancy in terms of features and whatnot, but you buy it because it’s still the cheapest option you have.
But, in Japan, due to the long history of custom-made systems, and the existence of a large number of System Integrators who also do contract developments for smaller IT projects, many B2B customers in Japan expect some form of customization to fit their particular needs from SaaS vendors as well.
This is where the importance of explaining the concept of SaaS and Cloud comes in—and how companies benefit from the cheaper price while getting the best product with the newest features without paying anything on top of what has already been paid, basically getting development for free. That’s something you need to explain a lot. And don’t underestimate explaining that concept because otherwise they think, “Oh, it’s the cheapest solution—but I can behave just like I used to.” Which isn’t the case.
Deconstructing Japanese perspectives on tech and IT systems
The relationship of Japanese with technology is slightly different from how it plays out in Western cultures. Here in Japan, technology is more like a tool or a toy even. And if you can use it and it’s fun or it’s useful, that’s great. But if it doesn’t fit you, then you can take it or leave it.
You can see that difference when you follow debates about technology as well. Between the debates in Europe or US versus the debates about technology in Japan. And debates about technology in US media or European media or anywhere in any conversation is so much more philosophical and about values, whereas in Japan it’s about “Is it useful or not useful”—for better or worse.
The different viewpoints also show up in the meaning of words. If you’re an English native or a European native, when you hear the word “system,” you don’t necessarily think about just IT systems. You think about political systems and organizational systems.
The term "system" comes from the Latin word systēma, in turn from Greek σύστημα systēma: "a whole concept made of several parts or members."
But in Japan, when you tell them “system,” or “shisutemu,” everybody thinks about IT systems. Conversely, when Japanese talk about systems in the sense of a concept made of several parts, it’s called “shikumi” or “soshiki.” They don’t use the word “system” because they already have Japanese words for it. So what does this mean for IT solutions?
When a Western company says, “Okay, we need to introduce an IT system,” this has implications on how an organization works. Because a system isn’t just a product or just a tool. Every IT system has certain assumptions about how decision-making is done, who operates based on what kind of authorities they have, etc., which is organizational.
And the problem that we see so often in Japan right now—especially with this whole DX trend—is that companies want to buy an IT system but the top management doesn't want to change their organizational system. So that’s why they have to ask for a lot of customization in order to make that IT product or IT system work for their organization, based on the specific ways that their company makes decisions and initiates approvals, etc.
I gave a webinar the other day to Japanese SMEs, some were actually from big companies as well. And I described the typical problem of DX and IT system introduction in Japan. The feedback I got was, “How do you know my company’s situation?” I said, “I don’t need to know your company’s case. It’s always the same story. It’s just that’s how Japanese companies are. You’re not alone.”
All that to say, when Japanese companies look to buy an IT system, they don’t necessarily want to change their process. They just want to make the way they do things more efficient or automate certain parts but they don’t want to change the process itself. That’s always a big problem.
That’s why something like robotic process automation (RPA) is so popular in Japan because you don’t need to change any of the processes. It’s simply automating what somebody in the company is doing. That’s it. So it’s easy to understand for Japanese companies. I don’t know how popular RPAs are in other countries but in my humble opinion, it’s just a sort of bridge solution. I guess it’s good as a bridge solution, but it doesn’t necessarily free up resources because you’re still tied in to the old methods of decision-making.
Implementing a workable B2B sales strategy in Japan
So that was a long and winding discussion about the history of B2B sales in Japan. We talked a lot about what the difficulties are and where they come from in a historical context. You’re probably thinking, “Right, right. I got it. So what am I supposed to do now?”
Well, now that you understand the psyche of those you’ll be sitting across the table from, you’ll be able to counteract all that during your sales process with the following strategies.
Show that you have common sense, which basically means showing you understand the customer. Make it sound like what you provide is the new de facto standard of the industry. For example, “If you’re not buying this, then you’re the one who’s falling behind the group.” Because that’s what Japanese companies fear most. They don’t want to fall behind the group.
Show cases of companies in the same industry, ideally. And even if you don’t have that, you can make up a case that makes it sound like it’s the same industry by saying, “Here’s a user case in a different industry but with exactly the same problems that you have, with a similar kind of organization and decision-making structure."
Ask the person across from you a lot of questions about how you can help that person create and deliver the kind of information and the material they need to convince their bosses or subordinates. Find out the KPIs that their bosses care about and help provide that information. Essentially, become a partner of the person that you’re sitting across from in order to facilitate the collective decision making in their company.
Offer to put on a sales demo for the subordinates and other stakeholders so that everyone gets the most powerful sales pitch directly from you, and not secondhand.
Pick a date for your next sales meeting at the end of your sales meeting—because if they’re indecisive then they might never get back to you. Say, “Let’s set up our next meeting where I will come back with the information that you need.”
For B2B sales, the approach to take is basically helping them by creating and gathering information. It’s a lot of work in the beginning, but when you do it a couple of times you will soon have your templates and patterns ready.
You might still need to pretend to look things up and take your time with the delivery. Sometimes it pays to take a week so you can say, “Yeah, I had to look up a lot of stuff, talk with my engineers, and interview other users. And here is your additional material.”
But that makes them feel like, “Oh, he’s working for me. He’s really making an effort.” And that adds credibility and trust and whatnot, even though it’s already made stuff.
And they’ll be like, “Oh, thank you for putting so much work into it. I appreciate that, and I’m looking forward to the next meeting.” And that’s how you slowly build trust.
Stay tuned for Part 3, which will cover B2B partner sales vs. direct sales and the pros and cons of each.
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