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Polished PR, perception strategy fourth arrow in ‘Abenomics’ quiver

by Jochen Legewie

Special To The Japan Times

Prime Minister Shinzo Abe is back and so, it appears, is Japan. The yen is down, the Nikkei up, and approval ratings and expectations for the new government are sky high.

“Abenomics” is the new buzzword in and outside of Japan as unprecedented optimism weakens the perception that Japan will never overcome stagnation or its slow decline. Restaurants in Tokyo are brimming with customers who are running up sales of luxury goods, while occupancy rates at five-star hotels hit record highs in March. Even CEOs of foreign multinationals are flocking back to Japan, eager not to miss the potential revival of Asia’s former heavyweight.

Hype or not, most domestic and foreign observers agree that Abe’s first four months were impressive. There are three main reasons for this: luck, good work and good PR.

First, the Abe administration’s luck stems from the lack of any viable domestic opposition. The Democratic Party of Japan is down and the only two charismatic politicians, Shintaro Ishihara and Toru Hashimoto, are still figuring out what their new party stands for.

The economic environments of Europe and the United States have meanwhile stabilized, allowing for a massive depreciation of the yen — the main driver of and most visible factor behind the optimism in Japan. And with China and India losing some of their economic glimmer, Japan’s profile has risen by default.

Abe is also lucky that Washington has rediscovered Japan can be a reliable ally for keeping China in check after all. President Barack Obama has offered help where needed, starting with concessions for entering the Trans-Pacific Partnership negotiations and promises of cheap shale gas exports.

Second, Abe and his new government have actually done some things right so far. His three-pronged policy of monetary expansion, flexible fiscal policy and a growth-oriented long-term strategy based on structural reform (the so-called three arrows of “Abenomics”) makes sense. He has already delivered on the first two elements.

More so, the new government has acted in a strategic and consistent way. Abe seems to have studied hard and learned a lot during his five years out of power. He now understands that his future, as well as that of the Liberal Democratic Party and Japan, depend most of all on the economy. Hence all other topics, e.g. rewriting the Constitution, have been put on the back burner.

The prime minister has correctly identified big business as a key ally and reached out to it on many occasions. He was the first prime minister in many years to visit the New Year reception of the influential Japan Automobile Manufacturers Association — a powerful symbolic gesture.

This and many similar steps helped him two months later to convince big corporations to accept above-average salary increases — a logical and crucial step supporting his pro-inflation policy.

The third factor explaining Abe’s success and popularity is simply good public relations strategy. Abe has assembled a team of experts and put them in key positions as deputy chief Cabinet secretary, public affairs advisor and speechwriter. These are Hiroshige Seko, a former communications director at NTT, Tomohiko Taniguchi, a former London correspondent for Nikkei Business, and Eiichi Hasegawa, a former Boston Consulting Advisor who used to be the Cabinet secretary for PR, respectively.

All understand the power of strategic communications. So does Isao Iijima, the mastermind behind the team. Iijama advised former Prime Minister Junichiro Koizumi and staged his enormously popular theatrical style of politics.

Between 2001 and 2006, Koizumi primarily relied on sound bites, dynamic gestures and a rebel image to portray himself as the one “to dismantle the LDP.” Abe’s new media approach under his new Iijima team seems to have a more mature and strategic bent.

It is not built simply around the person, but rather on a steady flow of carefully timed policy announcements, public appearances and targeted interviews with several Cabinet members. Abe himself stays on message and — more remarkably — so does everybody else. Even his gaffe-prone finance minister, former Prime Minister Taro Aso, is exhibiting hitherto unknown qualities and discipline in this regard.

Bank of Japan Gov. Haruhiko Kuroda added to the creative storytelling by introducing “qualitative” monetary easing. It is in this area where the new government has surprised and excelled so far.

The good PR has thus created the virtuous cycle of perceptions, expectations and reality that embodies Abe’s success and popularity. Carefully planned and executed communications have also played a key role in Abe’s most difficult mission so far, which was to enter the TPP negotiations without a major outcry from the public or his own party.

Anything other than a landslide victory in the Upper House election in July will be a big surprise. But what about thereafter? Will the Abe magic continue? Is there a chance for structural reforms and long-term growth to become reality?

The answers to these questions remain hidden in a crystal ball. Yasuchika Hasegawa, president of Takeda Pharmaceutical and chairman of the Japan Association of Corporate Executives (Keizai Doyukai) and one of the private-sectors members of Abe’s Industrial Competitiveness Council, got right to the point when he recently said: “The real uphill battle for the Abe administration starts now.”

But it is clear that Abe will need a good narrative, compelling story and additional personal positioning to convince his audiences to stay with him in the long run.

Back in 2006, Abe founded his policies on his ideal of Japan as a “beautiful country” — a vague idea that lacked specifics and did not appeal to anyone. This time, he needs to follow through on a hands-on approach that addresses real policy issues with a clear communication strategy accompanied by fitting key messages and proof points.

The overall message must be “reform,” and Abe’s primary positioning must become that of a reformer. There is no other positive term or concept that is likewise understandable and appealing to the majority of the people.

The concept of reform is not limited to a single time period. It is sufficiently comprehensive for all upcoming challenges, whether they be economic, political or societal in nature. Just think of Abe’s desire to change the Constitution. He might do so successfully if perceived as a reformer, but not as a revisionist.

But most of all, he should remember “It’s the economy, stupid.”

For Japan, structural reforms are the key to sustainable growth. A successful PR and marketing strategy alone will not bring them about. Otherwise Koizumi would have achieved a more lasting legacy. The opponents of reform are numerous and are part and parcel of Japanese society.

As of today, an Abenomics-led revival of Japan is merely wishful thinking. A virtuous cycle of creating and shifting perception and reality in the long run — a technique that could be called a self-fulfilling prophecy — can only succeed with effective communications.

It seems Abe has learned this lesson and is silently employing PR as the “fourth arrow” of Abenomics.

Jochen Legewie is president of German communications consultancy CNC Japan K.K. View his blog at www.cncblogs.jp.

  • Spudator

    So, according to the author:

    Prime Minister Shinzo Abe is back and so, it appears, is Japan.

    Hang on a sec; let’s not get too carried away. A few questions:

    - How are Sony doing these days? Selling loads of TVs, are they?
    - How about Panasonic? Those profits still rolling in?
    - What about Sharp? How are things at that LCD plant of theirs?
    - Fukushima? Is the mess almost cleaned up?
    - And how’s the post-tsunami reconstruction going? All done now?

    Let’s face it, Japan isn’t “back” at all; it’s a seriously troubled nation, and those five questions above only scratch the surface of its debilitating problems. True, Prime Minister Abe has been doing a good job of gaming the monetary system, and some of the numbers are starting to look positive. But we all know it’s just an illusion. The reality is that Japan needs to start earning money again, not play number games, because earning money’s the only way you become–and stay–prosperous. Unfortunately, Japan’s earning power is inexorably ebbing away thanks to a broken manufacturing sector that no longer makes products consumers want to buy. And who can blame those consumers? All the desirable stuff is now made in China, Korea or Taiwan, and it’s higher quality and cheaper than the Japanese equivalents. Japanese captains of industry can only look on in bemused disbelief as their Asian rivals eat their lunch day after day after day. And that’s the bad news.

    The worse news is that Japan’s big companies don’t have a clue how to fix their broken business models and get people buying made-in-Japan stuff again. Actually, it’s not so hard: they just need to start making exciting new products that completely change people’s lives, like Apple did with the iPhone and iPad. The problem is that to do such a thing requires innovation, and Japanese companies just aren’t innovative. They’ve never been innovative. Japan’s past manufacturing successes have been based on taking existing technology invented elsewhere (usually the U.S.) and constantly refining it, pushing it to its limits. This is good; but what happens once you’ve pushed a technology as far as it will go? The only way forward then is to create a brand new technology–to innovate–like Google did with cloud computing.

    Of course, this is where Japan comes unstuck. To innovate, you need a workforce of creative, individualistic, idealistic people. You need original thinkers and dreamers. You need loose cannons. But loose cannons are the last thing Japanese companies want. They want docile, obedient workers who’ll do exactly what they’re told and won’t cause problems by daring to think for themselves and question their bosses. And, thanks to a compliant educational system that betrays its students by putting the country first, this is what companies have always got. This is what they have now, and because of that, the innovative ideas they need to get back in the game simply won’t be forthcoming.

    Until Japan changes its attitude and starts valuing creativity and individualism over obedience and docility, I don’t see the country going anywhere. How long it’s going to take before Japan wakes up and starts putting the human spirit first and waga kuni second, God only knows. Maybe when Korea pushes Japan into fourth place, which it will, the old fuddy-duddies in charge here will finally be startled out of their extended afternoon nap.

    • Casper Steuperaert

      This is silly, you can’t use the sale numbers of 2 companies to determine a country’s whole economy. Especially when that country is Japan. The IMF numbers project a steady growing economy. Japan isn’t really “back” yet, but then, it never was away in the first place

      • Christopher-trier

        Reality is dull. Reality is boring. Even most of the monumental moments of history have, in reality, been utterly mundane. Life goes on as it always does.

    • Christopher-trier

      I do not worry about Japan. Really, I don’t. The reason is simple: Japan is a functional country with a functional society. The country has grave problems, but the people are holding together. Life goes on and people do what they need to do to survive without hurting each other. That is far more than I can say for the increasingly unlivable USA where increasingly success is being treated as grounds for envy, contempt, and abuse rather than praise. Individualism? Dreamers? Idealists? Trite. That is merely a product of Western Romanticism blown out of proportions by a media narrative. If you want that go to Las Vegas or the Costa del Sol. Japan will find its way and Japan is changing slowly, as is better. The country has survived far worse in its thousands of years of history than what is facing it now, it will get past this, too.