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July 12, 2021 03:17 PM

Japan Musical Instruments Association (JMIA) Special Online Seminar: Takuya Nakata, Chairman and Jyun’ichi Miki, Director Talk on Future of the Industry

JMIA held the 2021 annual meeting online on June 7. It was followed by an online special seminar, “Future of the Music Products Industry” inviting Takuya Nakata, chairman and president of Yamaha Corporation, and Jyun’ichi Miki, director and president of Roland Corporation. They talked on wide spectrum of topics from the pandemic to future activities of the association. Here are excerpts of the seminar. MC: Masato Oshiki, manager of general affairs and president of Yamaha Music Japan Co., Ltd. (photos: Takuya Nakata, top left, Jyun’ichi Miki, top right, and Masato Oshiki, bottom)

How can the industry turn new music makers evolved during the pandemic to loyal customers?
Oshiki: We are still struggling and faltering in the pandemic. How do you think we can overcome the present difficulties?
Nakata: Unfortunately, music products are not necessity for everyone in everyday life, but to our surprise we have witnessed a growing number of people started taking lesson of musical instruments or resumed music playing as music soothes and gives us relaxed feeling and pleasure during the lockdown. While sales of wind instruments stuttered due to greater fear of suffering from the desease while in play, businesses of other musical instruments rather exceeded the level of pre-pandemic. A trade wind for the industry. We can take advantage of this surge. People throughout the world found pleasure of music again.

Miki: We have used to talk people admire music making until very recently but not to be sure. Suddenly, the pandemic surfaced the demands. COVID-19 helped accelerate the desire of people to enjoy music playing. I think more leisure time at home will become a new trend. Nevertheless, they will be happy to go out once we overcome corona virus, but change of work style, increase of work from home may stay as a mainstream. How do they spend the extra time at home? Surely, they will turn to creative works such as music playing, painting picture, or advanced computer games. We have greater opportunities ahead.

Oshiki: We had a lot of music retailers participated in the annual meeting. We know middle or small businesses share a large percentage in the industry. The pandemic devastated shops on street, and as a result, EC prevailed. How can retailers keep their business go on in this hard time?
Miki: Lockdown seriously affects music retailers. It is natural that consumer unable to visit shops on street choose online shopping, and EC flourished. On the other hand, not a few people were convinced value of real time experience. They found going to live concerts and seeing friends in person are essential.
After we beat COVID-19, what can we offer customer face to face? Online trades must go on, but we can integrate value of visiting shops on street.

Nakata: I agree. We likely to view online and traditional trades as different means for business, but it does not tell any difference. Small store owners may say, “We are not ready to start EC”, but they can think another way. EC increases customer base. Then, how to lead new online customer to real shop? Music playing is fun in solo, but it is more exciting playing together with friends. Given that, there are many ways we work in individual local market. The pandemic has shed light on local issues and speciality business more than ever before. Capitalizing on one’s strength in given area, music retailers can better communicate with local music makers and turn them into loyal customer.

Change of value can expand the market
Oshiki: The pandemic almost devastated school music programs and extra curricula band activities. Many music retailers report decline of music teaching class enrollment. How do you see music education after the pandemic?

Nakata: I understand music education was only affected tentatively. After COVID-19 problem solved, it will revive. But it is hard to say if it fully returns to the previous level. The pandemic has changed our conception of value in many ways. If we can offer customer products and services matched to their needs, I think demands for music making will never decease, but rather, grow. “
“We faced problem in terms of school music programs even before the pandemic. Yamaha has promoted small size band and ensemble activities to cope with shrinking school programs. They will make effects after we return to normal. Take an instance, golf industry heavily promoted the sport to attract young players with versatile programs before the pandemic, but they failed. COVID-19 altered mind of youth, and now golf is popular among young generations. Musical instruments have great opportunities to appeal to new music makers if the industry employs proficient approaches.

Oshiki: The world still sails without clear views amid the pandemic. Do you have any tips proven effective through businesses crossing border?
Miki: As far as musical instruments are concerned, music retailers can impress visitors with their business polices, characteristic product lines, rich inventory etc. online. At the same time, I think it is essential that they upgrade communication capabilities with customer on the net. The new music makers picked up their instrument for the first-time during lockdown are not regular visitors to shops on street. They neither get access to retailer website for information. How can we stimulate their demands for music playing? The internet is the key.
Roland has started providing Roland community member with information in their need directly by linking hardware and software on Roland Cloud. Music retailers have many options, mail magazine, blog, or live commerce to communicate with local customer. Even if they do not have staff or device to start EC, they can take other effective marketing approaches at much lower expense today. I believe they can find prospective customer in their local area.

Nakata: We stay at home and cannot see friends and relatives in person. In this circumstance, Internet and SNS play a key role in communication. In China, live commerce we heavily promoted for some time generated a good result. Now, we are implementing the system in the Japanese market, too. It is sure that we would not introduce this type of market approach before the pandemic. A kind of marketing innovation. The new approach will help us provide customer of this day with services matched to their new shopping behavior.

Oshiki: One widely spoken topic in Japan is problem in digitalization of society and things. As we know Japanese music products market has declined year after year partly because of lower birth rate. Some JMIA members are concerned that leading manufacturers are likely to be more concentrated on overseas markets than domestic business. Do you have any comment on this issue?
Nakata: The domestic market has diminished these years, but we understand it is crucial for Yamaha today as it was in the past. We are based in Japan, and majority of people working for Yamaha are Japanese. Future of Yamaha solely depends on the point that our brand is well recognized in this market. Incidentally, we see the home market all important, never leave behind.

Miki: Having headquarters in Japan, this is the best test market in every way. Low birth rate and aging population are ongoing issues in Japan. Senior citizens have enough time and money to spend, and growing number of them have subsequent musical experience. Japan can be a test case how we promote music making to those seniors and develop the untapped market.
Nakata: Aside from low birth rate, Japan keeps sizable level of population which suggests there is more capacity to increase adult music makers offsetting decline of young musicians.

Build business that contributes to the society: Seek value than price
Oshiki: We organized Musical Instruments Fair Japan last year, the largest industry event online. Do you have any comments continuing it?
Nakata: We decided to organize it online last year for safety of the industry members and visitors. I think we can rebuild the event from the ground level. There is a market supported by ample demands here. Japanese consumer will appreciate the consumer show held every year here. It is a place for us to transmit information and communicate with end user.
Miki: I think we can organize the event in hybrid style of virtual and live experience every year at a smaller venue. It will allow visitors to try new gears on site, and people in remote area to take part online.
Oshiki: Any other ideas to increase music makers?
Miki: Well, JMIA can support music retailers helping them set up local community uploading musical performance of in-store studio students. Music retailers can build local communities connecting customers and providing network.
Nakata: Yes, network is the key. Manufacturers, retailers, and distributors can work together to build network which connects providers and end user. This will only be materialized by consolidated work and commitment of all industry members.

Oshiki: Closing this session, do you have any clues for the JMIA members?
Miki: All involved in the industry understand that Japanese market has prospective demands, but less than 10% of the population play music. When ask about musical experience in the past, about 20% or 30% of the population will nod. We know between 80% and 90% of people have ever played recorder. We will be able to inspire and support them to start music making again. We at Roland plan some programs including online events, and consumer-friendly promotions carried out at small budget.
Japan’s economy has been affected by decades of deflation. Price cutting pressure never brings growth to the industry. We can expect higher unit price by offering customer truly valuable products at proper price. Also, excellent services will contribute to increase our revenue.

Nakata: Mr. Miki and I share the same prospect for future business of the industry. We are engaged in this nice business. We get paid from musicians as we offer them tools to help inspire their musical expression. They enthrall audience with their fantastic music and make them feel pleasure of music. A great cycle which makes all involved happy.
Much is talked about Sustainable Development Goals (SDGs) these days. As much as we serve music makers, we successfully contribute to the society. Everyone involved in this business has extraordinary passion for music and musical instrument. With help of them, I believe we can consolidate our efforts to further develop Japan’s music products market.

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