Consumers' newfound propensity to shop for discounts and shun luxury goods marks a sea change that may boost foreign retailers in Japan, according to McKinsey & Co.
"This fundamental shift in the attitudes and behavior of Japanese consumers seems likely to persist, irrespective of any economic recovery," Brian Salsberg of McKinsey in Tokyo wrote in a report earlier this month. "For Western companies that have long regarded selling in Japan as not only different but also difficult, this may be welcome news."
Consumers' growing preference for cheaper goods is prompting department stores to close and deepening deflation. Even so, their increase in price consciousness, willingness to shop online and desire to buy in bulk may be just what foreign retailers from Ikea to Wal-Mart Stores Inc. need to penetrate what once was an elusive market, the report said.