Although the lockdown in Japan was relatively soft by global standards in 2020, most consumers nevertheless chose to spend the majority of their time at home, which drove down retail sales of luxury portable electronics. Moreover, the postponement of the Tokyo Olympic Games and significant drop in inbound tourists had a significant impact on the country’s GDP growth, which contracted by just over 5% in 2020.
The luxury portable consumer electronics category is entirely comprised of luxury wearables in Japan as there is no demand for luxury mobile phones. However, despite initial excitement during the launch of this category in 2015, Japanese consumers tend to have a more mature approach to luxury consumption and seek out functionality as opposed to status value.
TAG Heuer remained the leading brand in luxury portable consumer electronics in 2019. The brand launched the TAG Heuer Connected Modular 45 smartwatch in 2017, which was followed by the addition of the Modular 41 to the range in 2018.
Given the preference for functionality over luxury among domestic consumers, spending from inbound tourists became an important factor supporting the growth of luxury portable consumer electronics prior to the pandemic. Since the onset of COVID-19, the reduced opening hours of department stores and non-grocery specialists further hampered sales in 2020 as did the limited numbers of inbound tourists coming to Japan.
The limited range of products available in the Japanese market means that much of the competition for luxury portable consumer electronics brands comes from non-luxury alternatives, which have seen much greater product development. Within overall wearables, Apple remains the leading company, offering additional functions that are unique to Japan such as compatibility with Suica, a local pre-paid e-money system for transportation and shopping.
Once the pandemic recedes, retailers of luxury products will be more willing to invest in their e-commerce retailing capability in order to safeguard themselves from further shocks such as COVID-19. The shift towards e-commerce necessitated by home seclusion and national lockdowns around the globe are expected to alter consumer shopping habits in the longer term, with industry players having to adapt their retailing and marketing strategies to this new trend.
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Understand the latest market trends and future growth opportunities for the Luxury Portable Consumer Electronics industry in Japan with research from Euromonitor International's team of in-country analysts – experts by industry and geographic specialisation.
Key trends are clearly and succinctly summarised alongside the most current research data available. Understand and assess competitive threats and plan corporate strategy with our qualitative analysis, insight and confident growth projections.
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This report originates from Passport, our Luxury Portable Consumer Electronics research and analysis database.
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