Wool power a winner in Japan

Patience and evolution have sustained a Kiwi wool company’s presence in Japan for more than 20 years.

New Zealand Merino general manager Mike Hargadon said the key to sustaining a long-term relationship in Japan – a market often considered difficult to enter – was to evolve its branding to remain relevant.

Hargadon said the company was able to change its branding in 2007 when it established its sustainable brand ZQ.

‘‘We introduced ourselves using the New Zealand clean, green image as this resonated with that market, but the continuing challenge for us is to keep evolving our brand alongside New Zealand’s image,’’ Hargadon said.

The change was sparked by an increasing consumer interest in the story behind a brand or the product, he said.

For New Zealand Merino, it was packaging New Zealand’s pure image along with sustainability.

"If you go into Japan for a quick sale you'll be very disappointed. You won't go in there and crack it in your first, second or third visit, it takes time." Mike Hargadon, New Zealand Merino

‘‘Knowing the story of where it came from, its traceability and giving that insurance is very important to consumers,’’ Hargadon said.

‘‘Consumers are becoming a lot more conscious. They want to understand their product and understand where their products are coming from.

‘‘Ethically forced brands and products are becoming the expectation,’’ he said.

As e-commerce and social media have made communication more immediate, telling the brand’s story through these platforms has become essential.

In 2013 New Zealand Merino signed a deal worth $2.5 million with Nikke, Japan’s largest manufacturer of uniforms for top-end schools.

The Christchurch-based company’s revenue for 2016 was about $115m with 72 per cent of its wool being exported to Asia.

Hargadon said Japan was the largest consumer of wool in the world, making it an ideal market for New Zealand businesses.

His advice to Kiwi businesses was to be tenacious and to ask lots of questions.

‘‘If you go into Japan for a quick sale you’ll be very disappointed. You won’t go in there and crack it in your first, second or third visit, it takes time.’’

Japanese partners prefer long-term relationships and the best way for Kiwi exporters was to follow other established exporters in Japan, Hargadon said.

For New Zealand Merino, Japan remained the focus market in the region, but Hargadon said expansion to China was on the horizon.