A yen-ning for minimalism: why Japanese brands are taking young Indians by storm

As Japan's economy grapples with recession, its retailers are finding a silver lining in India's vibrant market, where they have made significant inroads thanks to a burgeoning middle class and a growing consumer penchant for minimalistic, high-quality goods.

While Japanese cars, watches and gadgets have long been popular among well-to-do Indians due to the high levels of craftsmanship, a new wave of mid-range retailers selling everything from fast fashion outfits to household goods is capitalising on that reputation for quality.

There are currently some 1,400 Japanese firms operating in India, where a massive manufacturing base and relaxed foreign investment policies are set to attract more to set up shop.

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"Indians have a long relationship of trust with Japanese brands, such as Sony and Suzuki, due to their association of Japan with high quality and price sensitivity," said Arnab Dasgupta, a research analyst at the Manohar Parrikar Institute for Defence Studies and Analyses specialising in issues related to Japan.

Household and consumer goods chain Muji, cutlery-maker KAI and lingerie label Wacoal are just a few Japanese brands that have reached Indian shores in recent years.

And with more than two-thirds of India's 1.4 billion people under 35 years old, fashion labels like Uniqlo are finding an audience among millennials and Gen Z consumers who want simple, well-made products, as opposed to a preference by older shoppers for flashy goods.

"I like Uniqlo, because its clothes are practical and functional with solid colours, simple cuts and no pretence," said Shalini Mullick, a scientist and writer based in New Delhi.

Uniqlo, one of the world's top four fast-fashion brands, opened its first store in Delhi in 2019, followed by 12 more in other major cities.

The firm last year recorded a revenue of US$6.24 billion, a 69 per cent increase from the year before, heating up a market that includes other global brands including H&M, which has 57 stores in India after arriving in 2015.

"Our business in India shows immense growth potential, and we turned profitable after three years," said a spokesperson for Uniqlo India, adding that the firm also had a robust e-commerce business. "The country holds vast potential due to its expanding consumer base, economic growth and changing consumer tastes."

Part of Uniqlo's popularity in India can be attributed to its emphasis on product localisation. In 2019, it teamed up with local designer Rina Singh to launch the Kurta collection, which combined Japanese sensibilities and Indian tastes. Uniqlo India also works with local mills and sewing factories.

Some Japanese brands have found success by partnering with Indian companies. Kyoto-based Wacoal, which specialises in long-lasting innerwear, entered the Indian market in 2015 through a joint venture with local distributor Periwinkle Fashions and now has 12 flagship stores.

Pooja Merani, Wacoal India's chief operating officer, told Forbes magazine last year that the firm had achieved a threefold year-on-year growth and was targeting 1 billion rupees (US$12 million) in revenue this year.

Meanwhile, Japanese retailer Muji in 2015 signed a joint venture with tycoon Mukesh Ambani's Reliance Brands, and now has four stores in India, including a sprawling 12,000 sq ft retail space in Mumbai's upmarket Bandra Kurla Complex.

The brand - whose name is an abbreviation of "Mujirushi Ryohin", a Japanese phrase meaning "no-brand quality goods" - offers footwear, luggage, clothing and home goods with a minimalist aesthetic.

"I love their functional, value-for-money products, especially their stationery and cooking tools. Their inventory is also fantastic, and you get anything you need under one roof," said Shoba Desai, an entrepreneur in Mumbai who frequents Muji with her teenage children.

Dasgupta said Japanese retailers had been smart about communicating their unique attributes to their target customers in India.

"For example, Uniqlo labelling their seasonal sales 'Arigato Festivals' creates a strong impression in the minds of young urbanites in India's metro cities, who are more likely exposed to Japanese words such as 'arigato' through their consumption of media such as anime and manga."

One challenge Japanese retailers have faced in the past has been price sensitivity among Indian consumers. But Harish Bijoor, a business and branding consultant, said he believed the latest wave of retailers was focused on building a following.

"The idea is to build footfalls first before climbing the hierarchy of price realisations," he said.

Chinese firms had adopted the same strategy in entering the Indian market, Bijoor noted. "The only difference in this route is the fact that the Japanese offerings are really high quality," he said.

This article originally appeared on the South China Morning Post (SCMP).

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