Richard's Eye

Japan's Zen-Like Consumer
Steady-state economy & Japan's reluctant consumers
Japan's Seasonal Factors
Seasonal income flow & impact on consumer spending
Arbitrage & Consumers
Law of "One Price" in consumer  product markets
Japan Viewed from the Outside
"Gai-jin,"  outsiders, views of Japan uncover new insights
Mobile phone usage habits -- Japan, China, U.S.
JMR study finds culturally influenced patterns
Richard May -- interview on iTV
Video clip -- marketing research
trends in Japan now
Software-as-a-Service
SaaS changes how you acquire software


Share this

 

100 Years of Marketing

100 years of Marketing -- Ohio & Japan                                       Hisakazu Matsuda
Marketing and Mitsukoshi have hit the century mark. This report begins with events in Ohio that set the stage for marketing to be recognized as a valuable contribution to consumers. At nearly the same time, Japan's first department store was born and a similar impulse is found behind the change - the search for new and better ways to meet consumers' needs.
Marketing comes of age
Some 100 years ago, the concept of marketing was born in the heart of the United States. Dr. Robert Bartels, in his classic and panoramic history of marketing, The History of Marketing Thought, pinpoints the period when the word 'marketing' was first used as noun. Previously, the term 'marketing' had been used strictly as a verb to refer to the activity of merchants. But, in a business course at Ohio State University in 1905, we find it being used as a noun to refer to the subject matter of those engaged in a profession. The general public on the other hand, had no clear concept of the justification of marketing as a productive activity or as a contribution to economic production. Rather, most simply regarded the marketer as a middleman that added cost, instead of value. In Figure 1 here, we have outlined the key events in marketing's history.


Emerging role as agent between the manufacturer and the retailers
At the turn of 19th century, merchants hired by the emerging manufactures had to sell their new products directly to retailers. Early brands, such as P&G and Coca-Cola, hired the marketer to make the rounds of mom-and-pop stores outside the main urban areas.These marketers encountered numerous problems in the process of trying to sell in what were then the hinterlands. They couldn't exploit the existing wholesalers located in the East Coast to develop Mid-West markets. At the retail level, mom-and-pop stores had their own lines of monopolistic store brands in each area. These mini-monopolists had little interest in adopting the manufacturers' brands and policies, which offered lower profits and uncertain brand images to the insulated Mid-West consumer. The still-poorly-developed transportation system into the Mid-West, dotted with struggling railroad lines and muddy coach tracks, contributed to the difficulties of penetrating the dispersed markets of Ohio and beyond. Merchants had to find and reach their potential customers by themselves; more than the usual amount of frontier spirit needed to accomplish this task. It was at this juncture in history that the marketers found a new word - marketing -- to express their new activities of linking the makers of products with their markets.

Manufactures in Japan turned to marketing at nearly the same time
Although Admiral Perry's fleet of warships anchored off Japan's shores helped pry open the doors to U.S. commerce, Japan's merchants went on as they had for centuries with craftsmen in each field supplying goods directly or through a single channel to customers. Then, at about the same time as students at Ohio State University were learning about the new role of marketing, a store in Japan decided to change its name to signal a bold step forward for marketing in Japan. In 1904, the venerable kimono maker Mitsui Kimono Store changed its name to what could be translated as Mitsukoshi Department Store, giving birth to Japan's first modern retailer. Until then, the makers of kimono traveled to the homes of wealthy customers to display samples and do fittings. The new Mitsukoshi took this bold move at the time and earned itself the reputation as one of the initiators in the process of modernization of the Japanese retail industry and the consolidation of small retailers into marketers. Mitsukoshi is, to this day, recognized as the standard bearer of the department store tradition in Japan.