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Why Did Anello Bags Sell? The Common Ground It Shares with Pokemon GO
—Social media word-of-mouth

Tomoko Kawakami
Professor at the Waseda Business School
(Graduate School of Business and Finance)

The wave of digitalization knows no boundaries. At the World Marketing Summit held in Tokyo in the fall of 2015, leading marketing authority Dr. Philip Kotler, who co-authored a book on marketing in the age of digitalization titled Marketing 4.0 released in December last year, spoke to the participants to either "Digitize or Die."

Take the bags from a brand called “anello” as an example. The brand is from Carrot Company, established and based in Osaka since 1988, and the bags record amazing sales recently. The anello brand was born more 10 years ago in 2005, but one of the undeniable reasons for its rapid sales growth in recent years is the power of social media.

Anello bags are characterized by their excellent functionality. They can be shouldered as backpacks or held as handbags, and their claps openings can be opened fully. In addition, they offer a broad range of product lineups of colors and pleasing design that are appealing to consumers of all ages and genders. With its reasonable pricing and availability across a wide range of distribution channels such as specialty shops, apparel stores and online stores, they are easily accessible to consumers. As such, it had the potential to target a large market of men and women of all ages to begin with. By no means did it sell so well by coincidence through word-of-mouth alone.

That being said, it is normal for any company to make operational efforts to provide consumers with quality products at reasonable prices and to deliver them through optimal distribution channels. That alone cannot fully explain anello's rapid and huge success. Behind this big hit lay the significant influences of factors that were not directly controlled by the company: (1) the unexpected help from an increase of inbound demands and binge shopping needs of Asian tourists and (2) consumers spreading the word through social media.

I call such word-of-mouth communication over social media "Social media word-of-mouth (SWOM)" and am researching how it influences the purchasing of products. It has long been known that word-of-mouth between consumers who have no direct relationship with the product has greater influence on purchase decisions compared to marketing approach from companies represented by advertisements such as TV commercials. Furthermore, social networking services (SNS) such as Facebook have diversified types of word-of-mouth methods in recent years.

In other words, in addition to personal word-of-mouth between acquaintances meeting face to face and virtual word-of-mouth between non-acquaintances in a digital environment, word-of-mouth can now be spread virtually between acquaintances and friends over social media. Social media word-of-mouth, so to speak, is a combination that takes the best of face to face word-of-mouth and digital word-of-mouth.

For example, if you are only looking to acquire information on specs and functionality, virtual word-of-mouth reviews alone from non-acquaintances might be sufficient. On the other hand, if you wish to acquire information related to the five senses or emotions, it may be more trustworthy to ask friends and acquaintances. However, friends and acquaintances may not always be familiar with the product or services you wish to know about. Social media word-of-mouth is speedy and widespread, and its reviews carry trustworthy information. Therefore, social media word-of-mouth is powerful.

Another product that did not rely on traditional marketing such as advertisement through TV commercials but social media word-of-mouth was Pokemon Go. Highly popular across all generations, Pokemon GO was a huge hit last year. In my view, Pokemon GO and anello are similar in that they enjoy benefit from social media word-of-mouth mentioned above.

Many factors can explain the success of Pokemon GO, such as technologies that developed over many years with a preceding game called Ingress, the utilization of Pokemon characters, augmented reality (AR), ease of use, the fun of collecting and nurturing Pokemon, and the brand power of Nintendo, etc. However, similar to anello, it is difficult to assume that the product strength and the delivering marketing strength alone were enough to make it such a huge instant hit on a global scale. Here too, was the influence of social media word-of-mouth beyond the control of the company—on a dynamic scale across the entire world.

In February this year, I visited Niantic Inc. in San Francisco and talked to Masashi Kawashima, who is the director of operations in Asia, who is an alumnus of Waseda University. Mr. Kawashima spun-off from Google with John Hanke, the founder of Niantic.

What left a strong impression in my mind during the interview were his words: "Niantic is not a game company." The business objective of Niantic, he said, was not to produce a game to be played indoors, but to bring people outdoors to experience an "Adventure on foot."

Upon hearing this, I realized one more commonality between Pokemon GO and anello. Not only were these popularity of these two products spread across social media, it was also possible to see, hear and observe their popularities in one's close vicinity. The progress of their rising popularity was visualized, which included seeing social phenomena associated with the products, such as people binge shopping in cities or walking with their eyes on their smartphones. This fulfills the observability conditions proposed by E. Rogers in his diffusion of innovations theory.

Even if the products received good reviews through social media word-of-mouth, if the phenomena were limited to the virtual world, they may not have achieved such a widespread and rapid rise in popularity. With this in mind, I believe the hint understand this hit phenomena lies in the mutual interactions of the web and real life.

Tomoko Kawakami
Professor at the Waseda Business School (Graduate School of Business and Finance)

Kawakami graduated from the Department of Literature at Osaka University in 1988. She worked at Minolta Co., Ltd. (now Konica Minolta, Inc.) in the R&D institute. She acquired an MBA from the Graduate School of Economics at Osaka University and a PhD from Graduate School of Business Administration at Kobe University with a doctorate degree in commercial science. She was a professor at Kansai University in the Faculty of Commerce before taking up her current position in April 2015. In April 2016, she established the Waseda Blue Ocean Strategy Institute (WABOSI) and became the director. She was also a visiting scholar at the University of Washington Business School (Fulbright scholar), a visiting scholar at the INSEAD Blue Ocean Strategy Institute, a research fellow at the Institute on Asian Consumer Insight at Nanyang Technological University, an editorial board member for the Journal of Product Innovation Management, a committee member for the EIASM IPDM International Conference, a director at the Japan Marketing Academy and the Japan Society of Marketing and Distribution