Boosting Customer Loyalty and WOM Marketing in Japan’s Cosmetics Sector

This chapter investigates how Japan’s leading cosmetics companies are redefining customer loyalty strategies amidst the rise of digital platforms and evolving customer behavior. Unlike the broader focus of previous analysis, the discussion specifically addresses the critical role that personalized experiences and community building efforts play in cultivating sustainable customer loyalty. The chapter delves into strategies for nurturing such loyalty, highlighting the indispensable role of customer relationships in sustaining a brand's success. The discussion further extends to customer loyalty's intricate relationship with Word-of-Mouth (WOM) marketing, where personal recommendations and shared consumer experiences play a pivotal role in influencing purchasing decisions. In a market where e-commerce had initially struggled due to the consumers’ preference for physically trialing products, the pandemic has inadvertently boosted online sales, making the understanding and harnessing of digital WOM more critical than ever. Analyzing loyalty through the lens of companies like Shiseido, FANCL, and Orbis, provides a framework for optimizing digital platforms to foster a loyal customer base. This analysis, rooted in Dick and Basu’s loyalty matrix, reveals varying degrees of loyalty, each with strategic implications for brand stability and growth. The chapter concludes by reinforcing the value of a digital platform not just as a sales channel, but as a community space for engagement, information exchange, and reinforcing customer bonds, setting the foundation for future research and strategy development in the post-pandemic cosmetics industry.