1. Sanwa Shurui 2

Sanwa Shurui succeeded in creating an 'iichiko' image and making the brand number one in the Japanese sake and shochu industry. As covered in the book 'Kiseki no burando 'iichiko' (iichiko - the miracle brand), the marketing strategy behind this success can be attributed to the large contribution made by Hideya Kawakita, a professor at the Tokyo University of the Arts. Born in Kurume, Hideya lived with his older sister Kazuko's family while attending High School in Usa. Kazuko was an employee at Sanwa Shurui, later becoming acquainted with and marrying Ihachiro Kawazoko, the number one support man assisting Noboru Wada in spearheading the iichiko development campaign. In other words, Ihachiro Kawazoko was Hideya's brother in law. It was this connection that later led to Executive Director Taichirou Nishi asking Hideya for his help with the advertising campaign for the iichiko brand. Hideya agreed, becoming solely responsible for the campaign. At the time Hideya was continuing his studies after graduating from the Tokyo University of the Arts. He was an up and rising young art designer, made popular by his involvement with the Tokyo subway etiquette advertisement campaign. He created a new poster every month to be stuck in subway stations. He gave the following reasons for choosing posters over making a television commercial.

The advertising consisted of B0 (2060mm x 1456mm) size posters at train stations. The campaign started with the posters being up for one week at a time. Why were posters chosen when they're not considered a very effective advertising medium? The answer can be broken down into two main reasons. The first being that iichiko was still not produced in great quantities and was often in short supply. Using a fancy and prominent add campaign on TV would increase the chances of creating a bigger shortage. A single poster at a train station would indeed not be very effective, but by continuing the campaign effectiveness noticeably increased little by little. That is to say that this kind of campaign was best suited to the concept of 'even after the shochu boom has ended iichiko will continue to sell and become the top genuine shochu brand in the country'. The second reason is that while posters may not be a very effective medium, it becomes a symbol. TV commercials, newspaper and magazine articles are only seenonce, but a large-sized poster is extremely noticeable every time you pass it. When iichiko came out Sanwa Shurui was a company of only about ten people. But the sudden growth that ensued meant the company had a large number of management and personnel problems that needed to be sorted out. It needed to change its corporate image (CI) now that it was in the big league.

Because the company had experienced hardships selling their refined sake they were conscious of not getting caught up in any more price wars. This now became an issue when dealing with the wholesalers. Trading, with 'quality' as their top priority, meant Sanwa Shurui could get the product out to the consumer at a reasonable price, and further more offer a product of outstanding quality in comparison to its rival shochus. This also helped improve the position of sake in society and enhance not just the image of shochu but also the image of other sake varieties as well. The financial and market stabilization of sake, as well as redefining the sake image was based on this improvement and people's efforts to make it work.

Therefore, when setting the sales price for iichiko a lot of consideration was placed on what the customer drinking the product would think was reasonable. This was different from what Sanwa Shurui's predecessor in the Oita barley shochu, Nikaido, was doing. For example, Nikaido's 'Kichomu' is sold in a pottery bottle, has an image of luxury, and quite a fancy price to go with it and this slowly enticed some of the whiskey drinking consumers over into the shochu market. They perceived Nikaido's luxurious image shochu as an alternative to buying whiskey.

However iichiko was priced so that normal people could enjoy not only its aroma but also its price. Despite being 25% alcohol iichiko was shown to be a versatile and convenient drink that could be enjoyed in a number of ways including straight, on the rocks, with either cold or hot water or even with an oolong tea mixer. When it was first sold in 1979 a regular 1.8 liter bottle of 25 percent iichiko shochu cost between 900 and 950 yen in Tokyo, not including tax. The alcohol tax on a 1.8 liter bottle at the time was around 73 yen so a tax inclusive price of under 1,000 yen was both affordable and appealing to consumers. Not only was iichiko affordably priced, it also had a lovely aroma AND could be drunk in a variety of ways. The combination of a price that reflected an aromatic shochu over a pungent one, and being a category of shochu that didn't overlap with the Nikaido shochu meant iichiko started attracting its own kind of unique customer.

And it wasn't just individuals buying iichiko, it also had a good reputation amongst restaurants and eateries. Before iichiko was really understood as its own kind of shochu, salesmen from Sanwa Shurui would try and push it at alcohol stores only to get told it wouldn't sell on its aroma alone. Compared to this time, iichiko was acknowledged by restaurants and bars for its wonderful aroma and flavor. The real market for shochu at the time was outside of the home, at izakaya bars and other restaurants.

A large portion of the demand for shochu was from businesses and this is where iichiko started to gain favor, becoming known to consumers as a reasonably priced, aromatic and popular shochu. In contrast, the majority of demand these days is directly from consumers with iichiko being drunk a lot more in the home. Sanwa Shurui had produced a shochu with a unique aroma that didn't leave you feeling hung over the next day. It was affordable and you could drink it in a variety of ways, and through this iichiko brand Sanwa Shurui created a channel of communication with the consumers. It wasn't just the technique used to make such a unique 'aroma', it was a mixture of all these things that helped iichiko become the leader of today's shochu industry

Sanwa Shurui's first priority was quality and this helped define the position of sales and marketing for the company. The 'voice' of sales and marketing was used to better manufacturing and being devoted to the manufacturing process was thought to give the company the position it had as a shochu maker in the industry. The widening distribution of iichiko can be attributed to the work of one man, Masaaki Kishi, at the Hiroshima branch of power-house Nihon Shurui Hanbai (hereinafter Nishuhan), a sake distribution and sales company. Masaaki Kishi, a salesman at the Hiroshima branch, discovered iichiko on a trip to Kitakyushu (north Kyushu island) and placed an order. An exclusive contract was signed, thus starting a strong and lengthy relationship between Sanwa Shurui and Nishuhan. This was very significant in Sanwa Shurui's ability to open up its market and Oita Prefecture shochu slowly became recognized in Hiroshima and other Chugoku (central Japan) areas. One of Masaaki Kishi's superiors at the time was transferred to Kanazawa (near Tokyo) and soon after iichiko was distributed there also.

These business dealings with Nishuhan also had another very important meaning for the management and operation of Sanwa Shurui. By dealing with a power-house like Nishuhan, Sanwa Shurui was able to avoid the kind of price wars they had had to deal with when selling directly. They were also able to protect any new products from experiencing a price collapse. Sanwa Shurui got caught up in price and discount wars when trying to directly sell its Wakabotan refined sake, and it was this reason that made them choose a sales route that would avoid this happening again.

While Sanwa Shurui didn't have the same selling power as the bigger companies the iichiko brand gave it a new reputation that spread via word of mouth. Little by little iichiko pulled customers away from whiskey, which had previously dominated the inner city drinking scene. It is thought that the preference that many restaurants and drinking establishments had for iichiko also played a major part. Even without trying to eliminate the middle man, Sanwa Shurui still won over companies by going through wholesalers and alcohol shops and it was this network, that seemed to form from the 'luck of the gods', that supported the company in its favorable growth, iichiko's reputation grew via word of mouth, fostering communication about the Sanwa Shurui born shochu. It spread to the urban community, becoming the topic of conversation and fostering sake centered communication

However, looking at the number of bottles kept by customers in local Oita Japanese-style pubs, iichiko has the same, if not slightly more, than its barley shochu rival Nikaido, and imo-jyochu brands such as Kurokirishima. The Beverage and Food Statistics Monthly publishes data on the sales ratio of shochu by region. While the data is quite fragmented, it does give statistics for the top two barley shochus in Oita and the top 5 companies with the highest shipping output in Kyushu. These have been compiled to form diagram 5. The 'Sales Ratio of Shochu by Region' is rounded to the nearest 1% and appears to be rough estimations of output. Sanwa Shurui is a leading brand and yet it is shown as not having a very strong placing in either Oita or Kyushu as a whole. On the other hand however, you could say that Sanwa Shurui wasn't tapping the local market already infiltrated by Nikaido, but rather the refined sake markets in Tokyo, Hiroshima and Hokuriku. Nishuhan and Kawakita's (discussed below) image strategy no doubt played a large role in this

In this climate it was art director Hideya Kawakita that kept iichiko from becoming a temporary trend in the market and turned it into the long seller it remains today. Hideya Kawakita was the brother-in-law of Ihachiro Kawasoko, the man behind the production department's development of iichiko shochu. Hideya didn't use a television add campaign for iichiko, despite mass media being recognized as the most effective form of marketing at the time. Instead, he decided to use posters at national railway and subway stations. The posters declared 'In the advertising world... There's new sake being drunk around town...A mismatched story'.

Sanwa Shurui was looking for a product that people could enjoy the aroma of, like Nikaido's shochu, but also a new product in its on right. They didn't want a product that would be a trend and then fade out, they wanted a long seller. Trying to create a marketing frenzy for a boom product wasn't a consideration, aiming instead for something innovative that would last the distance. Compared to a television commercial, a poster doesn't have the same immediate effectiveness, but good poster campaigns will encourage people to spread the word. It also worked in grabbing the attention of other media platforms. Unlike other forms of media, that tend to go hot and cold very quickly, this campaign fostered the steady growth of the iichiko brand over a long period of time.

The shochu boom of the second half of the 1980s spread to the younger generation. A marketing survey was carried out to find out exactly who was drinking iichiko. From this survey emerged an image of the iichiko drinker - 'a 40 year old Nikkei newspaper reader with an annual income of 6 million yen, who is highly sensitive to information and gives a lot of consideration to their way of life'.

The shochu boom soon passed. iichiko sales however continued to rise thanks to effective television and newspaper add campaigns. People began to spread the word and see poster and newspaper advertisements, which led to the making of a TV commercial. It was as if iichiko drinkers were pulling in new customers, helping create the current market.

The iichiko TV commercial later linked to the song 'Love with you again', sung by Fuyumi Sakamoto in the 2009 NHK Kohaku Uta Gassen. Even some of the strawberry generation are familiar with this song. Hearing this song, even in a different commercial, just evokes such a strong image of iichiko, the commercial and the singer herself.

A single local shochu maker designs a marketing campaign (commercial) that captures the minds of its customers, making them subconsciously link the theme song to iichiko shochu. There aren't many makers who have been able to achieve this, having their product spread from the local region to cities, and then to the world through associative consciousness. There are a lot of sake drinkers from generations unfamiliar with the Japanese group Billy BanBan, but even non-sake drinkers connect the song with Sanwa Shurui iichiko shochu. The song spans generations because even people that don't know much about the original singers connect it with the Kohaku end of year singing program and Fuyumi Sakamoto.

Sanwa Shurui publishes a 'Kikan iichiko' quarterly magazine on various cultural topics and also has a public website. These cover a lot of topics unrelated to iichiko shochu and attract non-sake drinkers as well, who are also able to comment and share their thoughts on the online 'iichiko forum'. In this way, Sanwa Shurui is making efforts to also communicate with the non-sake drinkers.

Even non-sake drinkers have some sort of image of people that drink iichiko, alcohol in general and even of the sake/alcohol itself. Furthermore, drinkers of iichiko and other people who are connected to iichiko associate with non-sake drinkers, so this image that is created is very important to the development of the market.

Sanwa Shurui's 'Customer Sourcing Department' established a customer enquiry office that works towards handling each and every need of the market. Even though it has grown in size, Sanwa Shurui still holds strong to the customer service and creation principals it had as a small to medium sized enterprise. As a sake manufacture, how many voices, how much feedback, can it get from people who aren't current customers? This kind of information doesn't come out in market surveys and it's the same in the foreign markets.

For example, in the Japanese market alcohol with a low percentage of alcohol is popular, while in foreign markets there exists a market for alcoholic beverages with high percentages of alcohol. The Japanese image lies in the expanding understanding of Japan as a health-conscious society, and in this light Japan was producing solutions to some new societal issues surrounding alcohol. Sanwa Shurui's proposal of a drink with a new and unique value really was the origin of its creation and the reason behind gaining the understanding of increasing numbers of non customers. The communication channels created and nurtured by Sanwa Shurui made proposals to the local lands and regions. Sanwa Shurui would join in trying to resolve the many problems that faced society. Perhaps representing this with alcohol is Sanwa Shurui's solution strategy.

Question 1: Describe the marketing strategy of "iichiko" in details.

Question 2: Why do you think their marketing strategy succeeded?

Question 3: How did Sanwa Shurui innovate and evaluate the product( iichiko) ?

Question 4: One of Sanwa Shurui's business philosophy is "serving the community eternally". How is the philosophy reflected on the marketing strategy of "iichiko"?

Question 5: What is your proposal for their future development?