Japan is Hungry For F&B Crowdfunding Campaigns - D2C Discovery #4
F&B brands are increasingly turning to crowdfunding to launch products in Japan. Our crowdfunding expert reveals how to cater campaigns to consumers in Japan.
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Happy Thursday Market Brewsters. Today’s post is about crowdfunding in Japan’s F&B industry!
An overview of F&B crowdfunding in Japan
Why launch an F&B product using crowdfunding?
What are the challenges for crowdfunding?
What are the best crowdfunding platforms in Japan for F&B products?
What kinds of F&B products are popular on crowdfunding sites?
What are examples of the most successful crowdfunding campaigns in Japan?
How do D2C F&B brands use crowdfunding in Japan?
What does the future of crowdfunding look like?
Overview of F&B crowdfunding in Japan
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.
It first originated in Japan around 2011. The first crowdfunding platform, READYFOR? was used to fund projects to support victims of the 2011 Touhoku earthquake and tsunami.
Since then, several big crowdfunding platforms have emerged, such as Campfire and Makuake. People and businesses use these platforms to create campaign pages where they explain and promote the products they want to fund. Users can “back” a campaign by investing in different rewards tiers. In return for their investment, users receive rewards based on the tier they selected. For F&B products, this is normally a certain amount the product being funded. For example, a campaign for locally produced craft beer might give beers in return for backing. The higher the reward tier, the more beer the backer will get.
More and more businesses are crowdfunding the launch of their F&B products in Japan. The market will reach a projected value of US$12.5 million by 2026 at a CAGR of 3%. Food and beverage looks set to be a high-growth category.
With Japan’s appetite for crowdfunding warming up, we asked Vincent, our crowdfunding maestro to tell us more.
Why launch an F&B product using crowdfunding?
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
Crowdfunding your product in Japan can be considered as a pilot-scale launch. It allows you to take your brand, product, and marketing straight to consumers to see if they buy-in.
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What are the challenges of crowdfunding?
That’s not to say crowdfunding F&B products is a risk-free endeavour.
In Japan, there are two main types of crowdfunding. "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.
If you want to test the market or do PR for your product, then “All-in” campaigns are best. You’re effectively selling your existing product, listing it using crowdfunding reward tiers.
Overseas products that succeed in Japanese crowdfunding campaigns all localize their brand. This includes translating your copy and messaging to appeal to Japanese consumers.
Interested in crowdfunding your F&B product in Japan?
Having a skilled expert to guide you reduces the risks when crowdfunding in Japan and sets you up to enjoy the benefits. GourmetPro’s network of food and beverage industry experts have an average of 15+ years of experience on the ground in Japan. That includes supporting successful crowdfunding campaigns. Contact the team at GourmetPro for a chat and:
What are the best crowdfunding platforms for F&B products?
Campfire has 6.6 million users and net sales of ¥3.3 billion as of 2021. Makuake has ¥1.7 million users and net sales of ¥4.5 billion.
What kinds of F&B products are popular on Japanese crowdfunding platforms?
Not all F&B products are backed equally in Japan. According to Vincent, confectionery products and condiments are big categories.
Vincent is confident there is room for any kind of F&B product to succeed at crowdfunding. A good strategy and excellent execution are key. These have enabled the success of products as diverse as plant-based meat to potato chips.
Know someone interested in crowdfunding?
What are some of the most successful crowdfunding campaigns in Japan?
What does it take for crowdfunding campaigns to succeed in Japan? Vincent revealed to us several examples of winning campaigns.
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 over $370,000. What can we learn from this high-performing campaign?
Horinishi Black Outdoor Spice
Hornishi Black is a “smoky” blend of 23 spices. It is the most successful “spice” product on Makuake, attracting over $200,000 in backing.
The product seeks to ride the wave of growing popularity for outdoor BBQs and “glamping”, glamourous camping, in Japan.
What are examples of D2C brands that have used crowdfunding in Japan?
Crowdfunding is also used by D2C brands as a test market and to raise awareness for their products.
Japan’s biggest plant-based meat maker launched a campaign on Makuwake in 2020 to develop version 1.2 of their vegan burger. The campaign achieved 4X their required investment.
ONE WINE is a D2C brand of canned wine by Suntory. They developed four flavours of wine with a famous French winery, Le Vins Georges Duboeuf. Their target is busy people who want an easy wine experience. People who don't want to open a whole bottle or spend too long choosing what to drink.
The campaign launched on Makuake and earned nearly $25,000, over 400% of the original target.
What does the future hold for crowdfunding in Japan?
We asked Vincent for his predictions for crowdfunding.
For companies that want to launch their product in Japan, crowdfunding is a high potential test market.
Want to learn more about crowdfunding the launch of your F&B product in Japan?
Check out our guide for crowdfunding food and beverage products in Japan:
That’s all folks
We hope you enjoyed today’s post all about crowdfunding F&B products in Japan. We’d like to say a big thank you to Vincent Nicol for sharing his wisdom with us.
See you next Thursday for our final installment of D2C Discovery.
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