The largest Japanese e-commerce consultancy business is not to be found in Japan but in the United States–Portland, Oregon to be exact.
TKAI, Inc. has experienced strong demand for its services
and undergone fantastic growth in its seven year existence.
“Our revenues will be up 250% this year and our net earnings will increase
more than twentyfold,” said Tim Clark, President of TKAI,
Inc. “We’ve been profitable since startup, but our net
earnings were quite small initially.”
Services offered by TKAI include strategic consulting, online
marketing and custom and syndicated research, as well as consulting
assignments from startups and other consultancies, involving strategic
planning and competitive intelligence research.
“This is extremely interesting work but it’s all highly confidential,” added Clark. “Early
next year we should be able to share more about what TKAI, Inc. is doing in
these areas. But increasingly we are becoming a Japan-specific consultancy
for a variety of projects that relate to the online world in more diverse
ways.”
“For example, last month we were asked whether we could produce
Japanese language packaging for a series of new modems and ISDN routers
with Japan specs being manufactured by a U.S. company,” he said. “You can see the new
packages at Comdex in Las Vegas next month.”
Companies that have sought out TKAI’s expertise or are continuing to do so
reflect a mixture of those names now commonly found online. Businesses such
as Amazon.com, Cyberian Outpost, Duty free shoppers, JCPenny, Neiman
Marcus, United Media (snoopy.com, dilbert.com), or telecom and high-tech
firms including British Telecom, Nokia, Nynex and Zoom Telephonics. In the
unlimited potential that is the Internet/e-commerce market in Japan, all
have similar opportunistic goals.
“Often they want to leverage existing assets overseas or are considering
new services specifically designed for Japan,” Clark noted. “In some cases they want to
understand how Internet usage in Japan intersects with a core service–for example, cellular telephone usage. In others they want to use online
techniques to perform research more quickly and cost effectively than they
could using traditional methods. In these cases they are often trying to
understand how Internet usage overlaps with the purchase of traditional
products or services–perhaps how the Internet can be leveraged to
conduct PR or marketing efforts.”
Although to many it might seem like a hindrance to cover the Japanese
e-commerce market from Portland, Oregon, TKAI, Inc. has established many
working relationships with various media outlets and partners/vendors
Yahoo! Japan, Nikkei, Asahi.com, Acara, and BIGlobe among others.
“First, our cost base is 20-40% what it would be in Tokyo, yet we have
exactly the same access to the Japanese Internet that we would have if we
were physically located in Japan,” said Clark. “Second, we are able to adopt the offshore
perspective that many clients need. Third, we can easily talk to both
clients and partners/vendors in Japan during business hours. Finally, we’re
located between Silicon Valley and Seattle and can easily visit our clients
in person at low cost.”
And while the debate continues on the perceived strengths and weaknesses of
the Japanese market, Clark is ultimately upbeat.
“Hundreds of thousands of Web users in Japan have successfully purchased
online from U.S. companies such as Amazon.com, Cyberian Outpost, and CDnow,
and used their Visa or other credit cards to dollar-settle transactions
using servers located in the U.S. So this issue has not been a showstopper
for the offshore applications that are spearheading international
e-commerce in the business-to-consumer sector. But financial settlement is
much more expensive within Japan, so it becomes a challenging issue when
you start looking at in-country operations.”
