Crowdfunding in Japan is becoming a popular way for F&B businesses to raise money. Crowdfunding is an online service that lets people invest in a product in return for rewards. In Japan, crowdfunding is a great way to test interest in your F&B product - before bringing it to market. You can also raise awareness about your brand and create excitement for your launch.
In this post, we reveal the opportunities and challenges for crowdfunding food and beverages in Japan. We also analyse examples of F&B campaigns to give you hints about how to crowdfund in Japan.
Overview of Crowdfunding in Japan
Crowdfunding became popular in Japan around 2011. The original platform, READYFOR? was used to fund projects to support victims of the Fukushima disaster.
A growing number of businesses are launching their F&B products in Japan through crowdfunding. The market will reach a projected value of US$12.5 million by 2026 at a CAGR of 3%. Experts predict food and beverage will be a high-growth category.
But is it the right platform to launch or test your F&B product in Japan? Or if you're already in Japan, is it an effective way to raise awareness about your brand and products?
The answer depends on your experience navigating Japan's complex but rewarding landscape. GourmetPro’s network of experts have supported successful crowdfunding product launches in Japan. Today we'll share what we’ve learned about crowdfunding for F&B to help you make an informed decision.
Why should you crowdfund your F&B product in Japan?
Why are more companies using crowdfunding to test the Japanese market for their F&B products?
Running a crowdfunding campaign lets you:
- Test the market for your F&B product in Japan
- Find new customers for your product and drive sales
- Build an audience for your product
- Raise funds to support future product launches
You can consider a crowdfunding campaign as a pilot-scale product launch in Japan. It allows you to take your brand, product and marketing straight to consumers to see if they buy in.
If successful, you gain confidence, an audience for your brand, and extra income for a future product launch. Existing backing also means you can prove your product sells in Japan. This will help you secure a more significant investment going forward.
If you fail, however, you will have spent a lot less time and money than if you launched full-scale. You will also have useful data to consider for your next step in Japan.
To reap the true rewards of crowdfunding, you need to nail your campaign. GourmetPro’s network of F&B experts can support you with everything from strategy to execution. Find out more about how GourmetPro can support your crowdfunding plans.
When is crowdfunding not the right approach in Japan?
The Japanese e-commerce market is the fourth largest in the world and full of potential. It's expected to grow to USD$324 billion by 2025. Crowdfunding will be a big part of this. But before deciding to run a campaign you should be aware of the risks.
Your project may not reach the target amount.
There are two main types of crowdfunding campaigns in Japan. "All-or-nothing" and "All-in". If your "All-or-nothing" project does not reach its target, you must return all funds raised. You do not need to fulfil your rewards.
For "All-in", even if your project does not reach its target, you receive all funds raised. You must deliver on whatever rewards you promised to your backers.
For testing the market in Japan, the "All-in" method is best. Food and beverage companies consider this a sales strategy. You list your products as “reward” tiers, increasing the volume of the product for higher-priced tiers. At the end of the campaign, you ship rewards to your backers in the form of products.
If your product does not reach its target, consumers and investors may lose confidence in it. This could damage future product launches. Discuss with GourmetPro about your plans and see how we can support your success.
Consumers in Japan may hesitate to crowdfund a foreign product they’ve never heard of
Japanese consumers are often hesitant to try foreign brands that they’ve never heard of. Crowdfunding is a great opportunity to tell the story of your brand and attract fans in Japan. You should invest in convincing copywriting for your campaign to attract backers. This includes localizing your product info and brand story for the Japan market. Don't waste the opportunity to raise brand awareness in Japan.
A third party may take your idea
If you crowdfund a new product, third parties and other companies may learn about it. It rarely happens but they may even take your idea. Make sure that you plan a strategy around your crowdfunding campaign. Always have a next step so you can act fast to capitalize on the outcome of your campaign.
Choosing a crowdfunding campaign strategy, building an attractive campaign, and understanding your product-market-fit. These steps aren't easy. But, they mean the difference between success and failure for your campaign. GourmetPro's experts can help you manage the risks of a campaign so you achieve your goals. Reach out to brainstorm together.
What are the best platforms for crowdfunding in Japan?
There are more than 10 different crowdfunding platforms you can use in Japan. Each one has different strengths and weaknesses. We’ll introduce the big three that are popular for F&B campaigns.
- Site Visibility: 6.3 Million (Monthly Visitors)
- Fees: 17% commission
- Campaign Success Rate: 36%
CAMPFIRE is the most well-known crowdfunding platform in Japan. It was founded in 2011 by Kazuma Leiri. The platform has a strong reputation for supporting the growth of start-ups as well as entrepreneurs who are coming into the market from abroad. Most importantly, commission fees are currently 17%.
We’ve seen many successful F&B campaigns on this platform, such as this Premium Mead inspired by a fantasy role-playing game. The campaign is a good example of how to tell a story that appeals to both fans and general consumers. Their campaign raised $130,000 with a total of 1093 backers.
CAMPFIRE’s strength is that it’s easy to use and set up a campaign. It’s also a well-known platform for backers in Japan.
- Site Visibility: 8.4 Million (Monthly Visitors)
- Fees: 20% commission
- Campaign Success Rate: 66%
Makuake is one of the best platforms to crowdfund a food and beverage product in Japan. It is known for its “all or nothing plan” and “all-in” plans. In both cases, their fee will be 20% of the total raised.
The platform attracts an audience interested in investing in luxury products and projects to support local communities. Recently, there have been an increasing number of foreign products launched via the platform, such as Egan’s successful whisky launch.
Makuake is owned by a large IT company in Japan. One of its strengths is leveraging its network to help promote your campaign.
- Site Visibility: 2.3 Million (Monthly Visitors)
- Fees: 12% commission*
- Campaign Success Rate: 75%*
READYFOR stands out amongst crowdfunding platforms for its low commission of 12% for their ‘simple plan’. However, they focus on supporting projects that offer an ethical, humanitarian or social element, so not all F&B brands will be suited.
Examples of this include a restaurant where food is made by people with dementia, which raised over ¥10,000 from 493 people.
READYFOR has an extensive project vetting process before accepting the campaign. They have been known to ask funders to prove an existing friend or family base in Japan (to help ensure initial traction of campaigns).
* Source: Data on crowdfunding platforms in Japan(Japanese), accessed May, 2022
Each platform has a different project approval process. These are annoying but essential steps to launching your crowdfunding campaign. There are cases where great campaigns get tripped up by a small Japanese administrative hurdle though. Having an expert familiar with these platforms will help you sidestep these hurdles altogether. Find out how GourmetPro can help with the operations of your campaign.
After choosing the right platform for your campaign, you’re ready to begin setting up. To give you some inspiration for how to build a campaign in Japan, we’ve analyzed two examples of successful campaigns.
Examples of successful F&B crowdfunding in Japan
Below are two case studies of successful campaigns for F&B products in Japan.
Hida Takayama Whiskey Distillery
This project launched on Makuake in 2022. It seeks funds to turn an abandoned elementary school into a whiskey distillery. The initial target was $20,000. By the time the campaign ended backing reached nearly $300,000, 1800% higher than expected. What can we learn from this high-performing campaign?
Japanese consumers love a good crowdfunding story
The campaign copy is compelling for Japanese backers for several reasons.
It establishes trust in the campaign owner's competence to realize the project. Hiroki Asusa, president of a sake distillery founded launched the campaign. His position and experience make him reliable for backers in Japan. Building trust with your audience is key in risk-averse Japan. Backers invest in the person as much as the project, so introduce yourself.
The copy tells a story that appeals to Japanese sensibilities. It focuses on "filling the abandoned school with smiles once again". Hiroki emphasises his dream to use the school to make whisky and teach about it too. This is an appealing vision for Japanese who idolize their school days. Nearly all F&B campaigns that raise over $20,000 in Japan have an attractive story to tell.
The copy is also detailed and paints a clear picture for readers. Japanese consumers, especially enthusiasts, love details. Adding a lot of information to your campaign page works in Japan.
Choose rewards that appeal to Japanese consumers
A key aspect for alcohol campaigns in Japan is the resale value of the product. This is certainly a big reason for the success of this campaign. Limited edition spirits fetch a high price in Japan and collectors will invest heavily in such products.
The reward structure of the campaign makes the product more attractive. Not only whisky, but backers can have their names engraved on a plaque in the distillery. One tier lets backers do a tour of the distillery in the future. Higher tiers combine rewards so backers can have their name on a barrel and get a crate of whisky.
Japanese make famously hardcore fans of products. Take time to research whether consumers are familiar with your product. If they are, find out what's important to them and offer it as an extra.
Use influencer support to promote your crowdfunding campaign in Japan
The campaign page includes commentary from influencers, such as popular whisky bloggers. The campaign promotes regional revitalization so also includes comments from Takayama's mayor.
Influencers connected to your product can help drive engagement in Japan. Take time to identify influencers who are relevant and care about your project. It doesn't have to be only SNS. For foods, local chefs for example can drive backers to your campaign. Be warned that influencers in Japan are in high demand. If you want to go the influencer marketing route, begin researching who to partner with early.
GourmetPro’s network of food and beverage industry experts includes leading F&B influencers and brand ambassadors. Reach out to us to find the perfect influencer for your campaign.
Choosing the right platform
Makuake was the perfect platform for this kind of campaign. Makuake specializes in original products that bring enjoyment. The user base is more affluent and willing to invest in luxury products and products that tell a good story. Think the clientele of Isetan.
Luxury products, like wine and spirits, confectionery, and exclusive membership bars, for example, often appear on Makuwake.
NEXT MEATS - The NEXT BURGER 1.2
Japan’s biggest plant-based meat maker launched a campaign on Makuwake in 2020 to develop v. 1.2 of their vegan burger. The campaign achieved 4X their required investment. What can we learn from them?
Choose a product that works well for crowdfunding
In 2020, plant-based meat-eaters in Japan were a niche audience. More so than today. They had limited access to plant-based products. NEXT MEATS offered a product to fill this gap.
NEXT MEATS product also appeals to consumers with a strong identity. "Vegans" and"sustainability-conscious" consumers want to invest in products that match their beliefs. In other words, NEXT MEATS already had a niche to target who are happy to invest in premium vegan products.
Crowdfunding is a good strategy to test the market for your F&B product, especially if it appeals to a niche.
Limited edition products do well in crowdfunding projects in Japan
Japanese consumers love limited edition (gentei) products. Crowdfunding campaigns that offer unique products specifically for the campaign often do well.
NEXT MEATS crowdfunding page tells a story about their burger's iterative development. They use "versions", such as 1.0 and 1.2, to make their product seem exclusive. Backers will be the only ones to try version 1.2 because soon they will be on to version 2.0.
Making your product unique for crowdfunding in Japan will increase investment. If you plan to sell your product through other channels, consider ways to add a unique element. For example, custom labelling, or a limited edition recipe for higher reward tiers.
Crowdfunding rewards should be realistic and appeal to fans and non-fans
NEXT MEATS used a simple reward structure. This works well for F&B products because backers ultimately want to consume them.
NEXT MEATS structured their rewards by volume. The higher the tier the more burgers you received. Mid-level tiers received deliveries over several months.
The high-end premium tiers add attractive extras for fans. $500 level backers receive 8 burgers and access to the secret Facebook group. The group members include researchers, intellectuals and students who discuss alt-meat innovation. The exclusivity will appeal to "fans" who want to be a part of NEXT MEATS brand.
$1000 + backers receive products and the opportunity to advise future product development. These tiers appeal to consumers who want plant-based versions of their favourite food. It's also attractive for people who want to help make Japan a plant-based friendly society.
Structure your F&B campaign rewards so that general consumers can back you. Create premium tiers that let "fans" invest more to be a part of your product or brand.
Do you want to test the market for your F&B product in Japan with a crowdfunding campaign? Let GourmetPro’s experts handle the hard work, so you can focus on the essentials!
If you’re curious to know more about launching your F&B product through crowdfunding in Japan, reach out to GourmetPro.
Our bilingual consultants each have an average of 15+ years of experience on the ground in Japan, specializing in areas including:
- Market Entry
- Market Research
- Market/ Brand Localization
- Business Development
- Technical specialists, and more
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