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09.6.2012
Like in every other country, businesses in Japan are gradually veering away from the traditional methods of advertising and switching to inexpensive and widely broadcast digital methods. Internet has been regarded as the chief beneficiary of this switch when compared with other means of digital advertising.
In a report published by Dentsu (2009) and shown below, it is indicated that the amount spent on advertising by traditional media dwindled by 14.3%, while there was a corresponding increase in the spending on Internet advertising. And this trend seems to have been upswing since then; now, Japanese businesses are expanding their stakes on Internet advertising because of its comparative advantage and cost efficiency.
Though, it is inferred that mobile advertising (using mobile phones and other telephony media) grew considerably in Japan lately more than Internet advertising (web-based/PC one), but there is hope that more people will turn to the Internet in the near future as many indications point to the fact that many Japanese consumers now rely on Internet search engines to find relevant information about goods/services they are interested in purchasing.
Apart from being cost-efficient, Internet advertising offers broader coverage, reaching so many people within a very short period of time. And it has been discovered that search engine advertising seems to do better than banners and other forms of display Internet advertising. The good news, though, is that Internet advertising enjoys higher production rate when compared with traditional advertising—meaning, more Internet advertisements can hit the market faster than their corresponding traditional advertisements.
With a firm projection that the Internet advertising will become widely utilized by Japanese businesses in not a distant future, there is an accompanying requirement for proper data storage, flexible access to digital content and smooth retrieval procedure. This is where cloud computing comes in; it is an indispensable technology that must be adopted for optimum performance and quick business operation.
Arguably, more access to the internet indicates that more digital files, content and data will be generated, and not many businesses are prepared to handle such unexpected hike in the volume of data received, processed and stored for easy retrieval. Adopting cloud computing will help businesses solve the problem of sudden overcrowding of data that may cause their servers to crash. Cloud technology will not only guarantee perpetual business activities, it will also maintain a great culture of dependability and trust.
In Japanese business circles, building business trust is a non-negotiable aspect of business practices. And the best approach for building trust is to provide uninterrupted supply of goods and services that consumers will grow to like and constantly request for. Cloud computing will help businesses keep their promises of timely response and delivery.
There is no doubt that Internet advertising will assist business owners in Japan to personalize their advertisements. This is almost impossible in traditional advertising where advertisers follow rigid procedures for formatting and publication. Internet advertising allows businesses to personalize the content and appearance of their advertisements for better pitching to their target customers.
Cloud computing is believed to be attractive nowadays to businesses that adopt it worldwide because there have been improvements in the issue of data protection/security. More so, the decrease in the cost of maintaining IT infrastructure and personnel makes cloud computing a must-try technology for businesses that aspire to cut its overhead cost of operation and maximize profits.
On a more positive note, cloud computing has the power to attract more customers due to its wide distribution power; it can also help businesses to retain those customers through the delivery of timely, efficient and reliable services that will win their loyalty for years to come. Interestingly enough, unbending loyalty is one of the rare attributes of Japanese customers that many service providers in other countries truly admire.
Our articles are written to provide you with tools and information to meet your IT and cloud solution needs. Join us on Facebook and Twitter.
About the Guest Author:
Jerry Olasakinju, a Bachelor of Technology (B.Tech) degree holder, is a passionate researcher and writer whose interest in everything computing is unparalleled. He blogs about his literary works at http://jerryolasakinju.blogspot.jp/
09.5.2012
A few months ago, the talk of social media gaming in Japan was centered around the new government regulations regarding kompu gacha. This mechanic was included in games by some of the biggest game social media games in Japan, including companies like GREE, Zynga, Klab, Konami, Sega, and Namco Bandai. Although the news caused shares to plummet and widespread panic about the future of social gaming in Japan, a few months later we’re starting to see that the effect of regulations on these companies’ bottom lines was minimal. Although there is no question that the gacha ruling did impact these companies’ revenues, their numbers a few months after the incident are looking quite healthy.
Understanding the basics of kompu gacha
Mobile gaming in Japan is an extremely lucrative industry. One of the reasons for this is that many games incorporate what is known as gacha. This is usually a game mechanic involving a micro-transaction in exchange for random in-game items. Some game developers in Japan depend on gacha to the extent that about half of their revenue comes from this practice. In fact, this practice started to spread from Japan and many of these developers started to establish gacha successfully in North America (for example, Rage of Bahamut by DeNA immediately comes to mind.)
Kompu gacha goes a step farther (“kompu” means “complete” in English.) In the case of kompu gacha, players are rewarded for putting together sets of items, usually very rare items. In fact, getting whole sets can be quite expensive, running into the hundreds of thousands of yen. However, the addictive nature of these kinds of practices prompted the Japanese Consumer Affairs Agency to act by regulating these kinds of games. Due to the fact that kompu gacha is such an important percentage of many of these companies’ revenues, it has lent itself to abuse, leading to many complaints from consumers. Most of these complaints deal with children having easy access to gacha in games, often purchasing hundreds of thousands of yen of in-game items in only a few days.
The predicted impact of regulation on the Japan’s social gaming industry
Pressures from the public and from the media caused many of the major gaming companies to self-regulate. However, the government stepped in due to this practice’s close resemblance with gambling. While the regulation is not particularly large, it was predicted to have a huge impact on the industry. After all, kompu gacha was a key profit generator for companies like GREE and DeNA. The stock in these companies plummeted by twenty percent after news got out and analysts predicted losses of up to fifty percent in these companies’ profits! More importantly, most Japanese social gaming companies are in the process of expanding into the United States market. This raised concerns on the impact of gacha regulations on the North American market.
Impact of gacha regulations lower than expected
Although the media covered the initial news of gacha regulations extensively, the exact regulations on kompu gacha are yet to be made public. However, as major social gaming companies in Japan release their mid-year numbers, the impact of regulations was considerably lower than expected. Although the media was predicting huge losses just a few months ago, most social gaming companies in Japan have reported profits, some (such as DeNA) with impressive growth of around twenty percent. This growth is all the more impressive considering that companies like DeNA and GREE have already stopped using kompu gacha mechanics almost entirely, despite the fact that specific regulations have not been disclosed yet. It seems that spending on virtual money has allowed companies to overcome the loss of kompu gacha on their games. However, it is entirely possible that the full impact of the loss of kompu gacha will be felt during the rest of the year.
Is kompu gacha really necessary for success?
If one thing has been proven in the last months is that kompu gacha is not an essential element for profiting in the Japanese social media gaming market. While smaller companies started to abuse and manipulate this unsavory aspect of social media gaming, the largest players have proven that to be successful in social gaming, it is necessary to have strong fundamentals. These three basic points of building a successful gaming company in Japan include:
Our articles are written to provide you with tools and information to meet your IT and cloud solution needs. Join us on Facebook and Twitter.
About the Guest Author:
Nida Rasheed is a freelance writer and owner of an outsourcing company, Nida often finds herself wanting to write about the subjects that are closest to her heart. She lives in Islamabad, Pakistan and can be found on Twitter @nidarasheed.