Korean boycott of Japanese brands unlikely to have lasting impact

The boycott is understood to cover products across all categories, ranging from automotive to electronics, clothing and tobacco. It was sparked by a Japanese government official’s participation in an annual ceremony that reinforces Tokyo’s claim to the Liancourt Rocks, known as Dokdo in South Korea and Takeshima in Japan. In a symbolic act, representatives of the group pelted a banner bearing the logos of assorted Japanese brands such as Toyota with eggs.

The merchants’ group, known as Save Local Stores Alliances, comprises a reported six million members and its call to action has resulted in a number of domestic retailers withdrawing Japanese products from their shelves. According to the Japan Times, the group has vowed to maintain the boycott until Japan relinquishes its claim to the islands and makes a full apology for crimes committed during its imperial rule of Korea.

The protest follows recent waves of violent anti-Japanese sentiment in China over similar political issues that resulted in the temporary shutdown of operations for a number of companies and dealt a blow to their revenues. Tensions continue to simmer in China and it is expected to take time before consumption of Japanese brands returns to the level that existed prior to the uprising.

Nonetheless, industry observers in Korea expect the impact of the current situation to be milder. Margaret Key, market leader at Burson-Marsteller Korea, suggested that the boycott was not reflective of the attitudes of society as a whole. Noting “significant trade” between the two markets, she also dismissed the suggestion that Korean brands may suffer a backlash in Japan.

“As of now, there is a general appreciation of consumer goods from both Japan and Korea in the two markets,” Key said. “However, we should never discount nationalism and how it can factor into such incidents, especially in a country like Korea where the power of social media used by smaller, vocal groups can ripple to the mass public.” She pointed to widespread demonstrations against US beef in the market several years ago as an example.

Key added that brands should not respond given that the issues were at their core political, rather than commercial or cultural. “Brands will always be associated with a country, but the manner in which they play a part in the global marketplace and how they can transcend borders seem far more critical than being attached to national issues and agendas,” she said.

Steve Yi, chief strategy officer at Grey Korea, pointed out that similar incidents had occurred frequently over the years in both countries and were likely to continue to be a feature of life. He noted that Japanese nationalists had recently protested outside the Korean embassy in against the perceived domination of Korean popular culture in Japan. “The link is that nationalists on both sides react with anger, not reason,” he said, also pointing to demonstrations last year in which Japanese motorcycles were set ablaze by Korean right-wingers.

“I doubt it’s going to go away, any more than the Nanjing Massacre dispute. In general, brands should not bring attention to the matter. What have Uniqlo sweaters or Honda motorcycles got to do with Dokdo anyway?”