“It is in our DNA, the foundation of all we do,” said Matushiko Ozawa, executive manager of Hakuhodo’s corporate public relations division, at a media briefing in Kuala Lumpur on Tuesday.

So deeply ingrained is the concept of sei-katsu-sha that even when conversing in English, all five representatives of Hakuhodo present at the media briefing did not once use the word “consumer”, preferring instead sei-katsu-sha.

“The meaning of sei-katsu-sha is different from the Japanese word for consumer — ‘shohisha’ — which limits the person to the act of buying. sei-katsu-sha includes their lifestyles, preferences and behaviour,” explained Ozawa through interpreter Yukiko Oono, a supervisor in Hakuhodo’s corporate public relations division.

Established in 1895, Hakuhodo has 68 offices in 17 countries including Malaysia.

“In fact, Hakuhodo Malaysia Sdn Bhd was started in 1973 and was the first office the agency had opened out of Japan,” said Toru Watanabe, managing director of Hakuhodo Malaysia.

Hakuhodo’s unique approach has won it numerous awards including a Gold lion for design, and two Silver lions for the cyber and direct advertising categories at the recent Cannes Lions International Advertising Festival in June. 

The concept of sei-katsu-sha was introduced to the 114-year-old agency in 1981 along with the Institute of Life and Living which studies consumer and sociological trends. Today, consumer behavioural studies are an industry standard but in 1981, the concept was new and set Hakuhodo ahead of other agencies, said Ozawa. Today, the institute has a strong research and development division that has expanded on the sei-katsu-sha philosophy to build a database of consumer research and create new advertising models such as the “Engagement Ring” which aims at making brands personally relevant to consumers.

In April, Hakuhodo became a major investor in Buyology Inc, a private marketing neuroscience firm founded by Martin Lindstrom that is dedicated to measuring sub-conscious decision-making and buying behaviour. Hiroshi Tanaka, corporate officer of Hakuhodo, said in an April 22 Reuters report  that neuroscience would allow the agency to dig deeper into the corporate philosophy by understanding the subconscious motivations of sei-katsu-sha. 

Technology’s swift advancement has “changed everything” about the advertising industry and the lives of sei-katsu-sha, while at the same time enabling greater insight, said Ozawa. The economic downturn which has caused Japan’s advertising expenditure to shrink by 4.6% to ¥6,692 billion (RM251 billion) in 2008 compared with 2007 had negatively affected not just Hakuhodo but their clients, he said. “Our insights will help us help our brand partners (clients) and we will recover together. Next year will be better.”
Ozawa and his team were in Kuala Lumpur to visit the Kuala Lumpur Convention Centre, the venue of AdAsia09 which will be held from Oct 22-24. Hakuhodo is a Gold sponsor for AdAsia09 and has supported the congress since AdAsia 2001 held in Taiwan. Yutaka Tezuka, a researcher at Hakuhodo, will be speaking on sei-katsu-sha at AdAsia09.

This article appeared on the Media & Marketing page, The Edge Financial Daily, August 27, 2009.