Table of Contents
Japanese Animation Industry. 3
Developments in the Industry. 6
Advantages of Japanese Animation. 7
Problems Facing the Japanese Animation Industry. 8
Porter’s Five Forces Analysis. 15
The Bargaining Power of the Customers. 15
Supplier’s Bargaining Power 17
Barriers to Entry of New Businesses Into the Industry. 18
Threat Posed by Possible Substitutes in the Market 18
Future Trends in the Anime Industry. 22
Japanese Animation Industry
Introduction
This study aims to evaluate the Japanese animation industry. The sector is crucial in the economic growth of the country. At the same time, several animation industries are also emerging such as in China, the US, and Europe. This is because of the surge of interest and demand for animation films in the market. Moreover, the animation companies can also collaborate with the business industry for marketing and branding aspects. In this case, this study is important because to evaluates the current dynamics of the industry. It evaluates the competitive environment as well as the appraisal of the macro-factors in the external environment. Understanding the external environment gives businesses the ability to strategically plan and implement approaches that give them the short term competitive advantages and the long term longevity of the business model and its brand in the market as well.
Industry Sector
According to Anggraeni (2017), the Japanese animation sector contains not less than 430 production companies with major studios. Additionally, most of these studios are structured into a trade association referred to as “The Association of Japanese Animations.” Workers in the industry had an organized labor union called “Japanese Animation Creators Association.” The studios would work together to make more compound projects whose costs are high (Anggraeni, 2017). In fact, there is an increase in the number of sales of shows to TV programs in Japan. The show is often at late night with the adults as the target population. However, this kind of anime is not popular in other nations outside Japanese. Notably, these films are among the highest earning Japanese films every year in that country. However, this firm has to get a license from the companies in other countries so that it can be released legally. Unfortunately, these licenses are expensive to acquire.
According to Cai (2016), the firm has its praises and criticism for fansubs. Moreover, there has been a problem of unlicensed subtitled translations of the industry films. These fansubs are highly spread online where many people can access freely. However, several cases of piracy have led to fansub distributors to follow the unwritten moral code. At the same time, the distributors motivated the viewers to purchase the official copy once it is released (Cai, 2016). The Japanese anime has been reported to increase rapidly since the time it was established. The anime sector was popular in Japan but later spread internationally thereby improving the number of domestic and international audience. The animation industry’s films are spread through television broadcasts that can either be direct to home media or via the internet. Therefore, it was categorized into many different classes targeting a different kind of audiences. For instance, there were some animations targeting children and others adults.
The anime sector has different methods of production and procedures that have been used over a period following on the emergence of technology. The sector usually has less concern on the movements but more of the reality on the settings and the camera effects. The animation industry makes a higher number of Japanese DVD sales compared to other film industry in that country (Cazacu, 2016). Additionally, the rise of English styled programs led to increasing in the success of this company internationally. However, international popularity has resulted in the productions of non-Japanese anime using the official anime art style. These kinds of films are referred to as anime-influenced animation rather than been seen as the original anime film.
Genres
The target population with a broad range of styles targeting the adults as the audience usually categorizes Anime. However, some genres produce anime that contains the components well known to children of both sexes to acquire border appeal. An adult anime may have a slow pace and can be more complex that children find it unappealing. In fact, some of the adult anime show pornographic contents that should not be viewed by children (Hernandez, 2015). In this case, the sector has experienced an emergence of genres that show the homosexual romances. Therefore, such animations were made purposely for adult individuals. The animators’ work should be based on the kind of the target group they are targeting.
Globalization
Anime has become western countries commercially profitable. Adaptation of the America made Japan expand into the continental European market. Its main produce target was European and Japanese kids who later spread in other countries (Qing, 2016). Many countries like Spain, France, and Italy were more interested in the output from the Japan industry because the price was low and the output was more productive. As a result, the Japanese anime became popular in other nations like Arabic. In the year 1980, Japan introduced its anime to the American culture. Therefore, the Japanese animation started to get popular in the America slowly. In fact, some media industries began publishing and bringing the animation into the American market. The development of internet and technology made it easy for the western audiences to have access to these Japanese animations. Notably, the interest of the Japanese anime increased as more countries became more aware of the content (Xiao, 2014). The growth of anime was through fan distributors who made the other fans aware of the new productions. The development of Japanese anime has increased globally as many people are accessing them very quickly.
Developments in the Industry
The Japanese studios have started to use general attack on those who engage on piracy issues without any reliance on the outside mediators. In fact, they have established their online sites where viewers can stream live the animation videos. The anime industry is now known in the whole world to be the most convenient source of entertainment and art (Liu, 2016). There are anime series made by the industry for the viewers who can only have access to mobile phones. It has helped them to view the films from their cell phones without any difficulties. Additionally, the barriers to animation have been decreased by the series like Maya and Flash. In fact, these animators can place their work directly to the web where viewers can view without any need for a TV. As a result, the industry has become popular since fans can have access to the animation even when they do not have a television. Japan government has promoted the anime thereby helping its market from foreign countries. The exportation of Japanese anime to places like Europe, Saudi Arabia has increased the interest of anime industry. Therefore, creating a market for the work animators and improving the economy of Japan. An organization guided by the Japanese government holds business matching to help the animation industry develop more than the other different animation industries (Morisawa, 2015). The firm has tried to ensure that the original work of the animator is available to the market and they are well paid for the work done. The animation fans are willing to pay for the product, and sometimes they pay even more. As a result, the industry has improved, and the animators have been encouraged to make their work even more attractive.
The anime film is using the production committee, which has increased the Japanese income and has made the foreign investment increase. The TV programs are sold overseas to attract investment from the outside nations. Decreased use of DVD copies has helped the Japanese reduce the rate of piracy on the original work of the animators (Nakamura, 2017). Creation of individual online communities where fans could share the animations and interact has become very popular in the local and international markets. There has being formation of sites where people can easily access anime films. The creation of anime and manga fan communities on the site has allowed people to share some arts. Indeed, this is a way for fans to show their interest in anime productions. Fans have made some advancement in peer-peer software so that they can download the anime faster.
Advantages of Japanese Animation
It acts as form of entertainment to everyone because every animation has a targeted group. People viewing their anime will enjoy the film and share with friends. Additionally, it helps people find friends online. As fans share the film through websites, they can interact and know each other in the process. It can help one study abroad by understanding the Japanese language. The industry acts as a source of income to the animators who make the animations (Standing, 2015). It also does as a source of revenue to the Japan country as they can sell their films to the foreign countries. Through the understanding of Japanese language, one has more job opportunities because they can do business with the Japanese people. An individual has a chance to learn about the other languages that are closely related quickly. People could eventually use their mobile phones to view and download these films.
Problems Facing the Japanese Animation Industry
The process of producing an animation is time-consuming. It takes a lot of time for an animator to follow the steps and the principles of animation so that they can make a more impressive animation. In fact, they must ensure that their work is attractive and the content is well illustrated for the targeted group. The process seems to be expensive thereby reducing the number of animation that the industry can handle. Additionally, the firm must make a more popular anime before bringing it to the market thus it requires more fund to produce an anime. The animation studios are bringing the same repeated anime to the market making their products very annoying to the fans that have already seen their work more than once (Napier, 2016). The firm faces the increase in competition. This is primarily because of the surge of industries such as the Chinese animation sector as well as the American and European industries. The business has faced a major problem of piracy resulting in loss of revenue by the various studios. In fact, the work of the animators is displayed on the websites where people can share the videos with their fans thereby increasing the rate of piracy. The death of a respected animator at young age affected the animation industry in a negative way. In fact, the animator who had experience in producing a more creative and innovative film died very young.
PESTEL Analysis
In many instances, businesses prefer to operate in a country or market that provides favorable macro-factors in the market. This means that the success of an enterprise is highly dependent on the relationship between its core internal competencies and the external environment (Ichikohji, 2013). The external environment is influenced by the macro-factors such as the economic, political, social, technological, legal, and environmental factors. In this case, a PESTEL analysis will provide an in-depth analysis of these macro-factors in the external environment occupied by the Japanese animation industry in the country. The core factors are discussed below.
Political Factors
Japan’s core politics is massively stable. The structure of the government and its relationship with the business sector is balanced and mutually beneficial. This means that the government and the political class in the country support the business community because they form the foundation for growth, innovation, job creation, and economic prosperity of the Japanese society (Cook, 2016). Therefore, the government provides massive support to creativity and innovation in many ventures and sectors of the community. The animation industry is one of the innovation- and creativity-dependent industries, which means that it is a prime candidate for support from the government.
According to Naito & Hausman (2005), the involvement of the government in the IT sector in Japan has been one of the primary driving forces of its success regionally and globally as well. Naito & Hausman (2005) indicate that the “IT Strategic Headquarters” has achieved tremendous success with the e-Japan Strategy that has helped establish the infrastructure throughout the country. This has provided an enabling environment for the thriving of the animation industry in the country. Naito & Hausman (2005) indicate that the total spending of the Japanese spending on supporting research and development R&D is around 3.35 percent. This highlights the significant role of the involvement of the government in establishing a suitable external environment for the growth and development of core industries in the IT sector such as the animation industry.
According to Okeda & Koike (2011), Japan is heralded as one of the world’s leading in animation technology and industry size. However, Okeda & Koike (2011) argues that the development of the industry over the years has not been with the support of the Japanese government. However, its sheer size and economic significance to the Japanese economy means that the industry is now under the supervision or evaluation of the Japanese Animation Creators Association that has focused its appraisal on the conditions of the sector’s workers. Additionally, political decisions might influence the animation industry’s reliance on outsourcing to South Korea and China. In this case, the analysis results indicate that young employees face poor working conditions. This means that the industry is subject to the government’s regulations regarding employee conditions and international relations.
With a new administration in the US seeking to check the dominance of the likes of China and Japan in the US markets, the politics between Tokyo and Washington might influence the future growth and expansion or the status of the animation industry in Japan.
Economic Factors
The Japanese economy is one of the world’s five largest; This offers a suitable economic environment for the growth and expansion of the animation industry in the country. The country places massive emphasis on education. This has allowed Japan to produce some of the most talented, hardworking, and innovative employee pools in the world (Cook, 2016). This offers the animation the talent, creativity, and innovation it needs to be dominant and establish a competitive advantage in the market over its competitors locally and internationally as well. The students are encouraged to contribute to the society. This allows them to face the challenges and difficulties facing the society. Therefore, they have a chance to come up with creative and innovative solutions to these difficulties (Cook, 2016). This establishes a pool from which the animation industry has benefited regarding its staffing, innovation, and creativity in an industry is dependent on such “out of the box” thinking to come up with creative solutions.
Being one of the largest economies in the world means that the country is filled with businesses and individuals that readily need the products and services offered by the animation industry. This means that the Japanese animation industry had an enormous local market for their products and services before they even sought out the regional and global markets. This gave them the economic grounding thy need to be massively competitive in the ultra-competitive global market (Thornton & Houser, 2005). For example, Japan is home to one of the world’s largest auto company in Toyota; it is also home to the likes of Toshiba, Softbank, Nissan Motor, Honda Motor and many other major players in the global market. Additionally, the country has a massive consumer market as well. This dynamic created a crucial market for the growth and expansion of the animation market. Animation fuses the human aspects of the society with the business messages or targeted communiqués aimed at a targeted audience (Thornton & Houser, 2005). This economic environment in Japan allowed the industry to grow and expand to the level seen today.
In recent years, the emergence of China means that Japan is no longer the dominant player in the regional market regarding IT or technology, including the animation sector. Additionally, the impact of the 2008 global financial crisis (the Great Recession) was massively significant to the sector’s bottom line and its projections for the future. Spending by major multinational corporations and local businesses in the region and within Japan reduced markedly during and in the aftermath of the Great Recession (Thornton & Houser, 2005). As companies and businesses bled consumers, employees and fiancés, the appetite or demand for animation products and services tanked as well. This is an indication that the trends in the global economy have significant implications for the Japanese economy, including the animation industry (Fenlon, 2012). Additionally, the level of competition in the animation industry is massively increasing with the emergence of credible and fiercely competitive animation industries in the US, China, South Korea, and European countries as well.
Social Factors
With over 127 million residents in Japan, the country offers an expansive and diverse market for a myriad of businesses. This means that the thriving marketing and branding sections of these companies form the groundwork and market for the expansion of the animation industry. This is because the animation companies work hand-in-hand with the businesses and entertainment firms as well (Sun et al., 2013). The notable aspect of the social life of the Japanese society is the emphasis on hard work and industry. This has been the primary driving factor in the growth and expansion of Japan into one of the world’s finest economy, industrial and technological powerhouse as well. On the other hand, the Japanese community focuses on settling down and marriage. A Japanese woman is expected to be married by the age of 30 years and have children with an emphasis on a male child to inherit the family wealth. Once a woman is married, they are expected to leave the workplace and take care of the household. Although this social aspect is disappearing in the modern Japanese society, it has affected the participation of women in the economy (Thornton & Houser, 2005). This means that the animation industry has lacked the gender diversity seen in other countries in Europe and North America.
Technological Factors
Technology is at the heart of the animation industry in Japan and the world. In this case, Japan has one of the most developed and advanced telecommunications and technology infrastructures in the world. The advancement of the Japanese technological sector can be underscored by the high investment of the country in research and technology as well as the education system (Thornton & Houser, 2005). This has helped establish the enabling environment and provide the requisite resources (technology and personnel) to help in advancing the animation technology. Japan is also one of the hubs of technological education in the world. This means that many students from different backgrounds and countries come to Japanese universities and institutions of higher learning. This has afforded the animation sector the diversity of talent and ways of doing things that have enabled it to adopt different approaches ad innovations in dealing with the challenge sit faces in the market and internally as well. Some of the techniques used in the sector are reviewed below.
Since the early 90s, animation producers have substantially used computer animation to advance the effectiveness of the manufacturing method. The earliest anime production was experimental and contained images drawn on blackboards. Cell animation was increasingly becoming popular during those days. However, 21 century welcomed new methods where computers were included in the animation process (Dai, 2016). In fact, a significant cell production firm announced that they would stop the production and the importation of their produce and switch to the digital process. Previously, anime was made using the traditional animation methods that utilized pose procedures. Therefore, many anime mainstreams were using less expressive key frames and more in-between animation. Anime emphasize on the quality of the art while Disney animation emphasis was on the movement. In fact, the animation techniques used by anime production film helped to meet the deadlines and was a perfect artistic device. Anime sections put more emphasis on attaining three-dimensional views. The animation industry films differ from the stage plays found in American animation because of its cinematic effects. The animation in anime is produced before the voice acting while the American animation starts their process with the voice acting (Drazen, 2014).
The ubiquitous nature of technology in the country also means that many consumers in the country are technology-savvy. As a result, businesses and other companies have employed the animation sector in marketing, branding, and reputation building because they can reach a broad range of the targeted audience and thus enhance the chances of the enterprises connecting with the consumer base (Sun et al., 2013). At the same time, the ubiquitous nature of technology in the world means that competition is increasing at the global market level. This means that the competition for the animation sector from the likes of China and South Korea (regionally) and Europe and the US (in the global market) have led to a reduction of the Japanese animation industry’s stake of the regional and global market share.
Environmental Factors
Japan has increasingly become environment conscious. This means that many of the companies have to focus on their carbon footprint and pollution effects on the environment. The country has established regulatory conditions and rules aimed at ensuring the cleanliness of the environment and approaches taken to reduce emissions into the atmosphere to address global warming (Thornton & Houser, 2005). However, the animation industry has a minimal carbon footprint and pollution records. As a result, the environmental aspects or rules in the country do not affect its operations. However, the industry has had a significant impact on the conceptualization of issues such as global warming (Schuster, 2010). For example, the industry has been able to create a 3-D representation of the emissions of greenhouse gasses into the atmosphere and its contrition to global warming.
Legal Factors
Many of the Japanese laws such as the corporate and labor laws are based on the European system. This means that the Japanese market is readily available to many businesses and corporations from Europe and the US. This has also made it easy for the animation industry in Japan to access crucial markets in these major economies (Thornton & Houser, 2005). This has offered the industry access to one some of the biggest and active economies in the world. In this case, it has allowed it to expand and grow its international network.
Legal factors have also been influential in influencing issues such as working hours, minimum wages, and the working conditions of the employees in Japan. The involvement of the government is often aimed at regulating the markets to ensure the businesses are involved in the growth and expansion of the broad Japanese economy and its people as well.
Porter’s Five Forces Analysis
The Japanese animation industry is also exposed to micro-factors within the external environment that have a crucial influence on the growth, expansion, and success or failure of such an enterprise (Choo, 2013). Aspects such as competition, consumer behavior, the supply chain, and the existence of substitutes in the market influence the business strategies adopted in the market. As a result, it is crucial to understand the impact of these micro-factors on the scale and extent of the firm in the market. In this case, the Porter’s Five Forces analysis provides the best evaluation of these micro-factors below.
The Bargaining Power of the Customers
In business, consumer behavior is crucial. In fact, many marketing and strategic approaches adopted by businesses in the market are aimed at enhancing the business’ ability to sway consumer behavior or purchase behavior. Successful firms in the market have established marketing messages, product or service brands, or pricing policies that influence consumers to buy products (Pieterse, 2015). In this case, the behavior of customers should be adopted in the creation of a product and its branding. For example, in the animation industry in Japan and the world, customers often choose or flock to purchase the latest products and trends, and they often stray away from the older or dated products in the market. This behavior means that the Japanese animation industry has to focus continuously on producing new products into the market to keep the interest of the market high (Can, 2014). Otherwise, with massive competition coming from the likes of Hollywood and other major industries, the Japanese industry might lose consumers en masse. The pricing policy is crucial in influencing consumer behavior. In this case, the level of competition in the animation industry is massively high. This means that the customers have a broad range from which to choose. This shifts the bargaining power to the consumers, which means that companies that succeed in carving out a market share provide their products at competitive prices in the market (Ferraro & Brody, 2015). With the average DVD sales in the market estimated to be between $12 and $19, this sets the bar for the cost charged by the companies in the market.
At the same time, the film industry reports that there has been a massive spike in the demand for animated films. In this case, it means that the animation industry has an increase bargaining power over the consumers compared to the traditional films. Therefore, consumers are willing to pay more to watch an animated film compared to the conventional films (Ferraro & Brody, 2015). This added demand and popularity has established a massive impetus for the growth of the animation industry in Japan. Once the animation company has produced a film or product, the customers have the ability to choose whether they will view a movie or not. This choice affects the profitability of the company and franchise behind such a film either negatively or positively.
Supplier’s Bargaining Power
Most of the animation industry businesses or corporations are their own suppliers. This indicates that the supplier bargaining power is massively low in this sector. The company itself can supply many of the materials and technologies or software needed for the production of animations (Ferraro & Brody, 2015). Therefore, this eliminates the role of the supplier in limited aspects of the production line. Within the Japanese animation industry, handwritten animations are increasingly being replaced by state of the art computer technologies. In many cases, the suppliers in this industry are referred to as the individuals with the creative and technical filmmaking expertise. However, with the advent of different computer technologies, their services are no longer needed. This is because technology enhances the efficiency and effectiveness of the products provided by the market (Hemmert, Bstieler and Okamuro, 2014). The fact that a few large entertainment and media corporations control the sector diminishes the power of suppliers. In many cases, a massive chunk of the value of the participating companies is in-house, which reduces the role played by suppliers in the market significantly.
Barriers to Entry of New Businesses Into the Industry
The animation industry has become massively dependent on computer technology. The ubiquitous nature of such technology around Japan and the world mean that anyone with a PC and software can create and market animations. This means that the barriers to entry into the sector have been lowered significantly (Schendl, 2016). However, the cost of production of an animated film is one of the primary barriers. For example, on average, an animated film takes around 100 million in initial investment to produce. Additionally, there is a need for a road workforce to provide the requisite skill sets and workforce to produce a film (Schendl, 2016). In many instances, lack of an educated and skilled workforce is a massive impediment to many possible startups in the industry. Therefore, this force is considered mild in the animation industry.
Threat Posed by Possible Substitutes in the Market
This force is significantly high in the animation industry. Technology in this industry is massively advancing. This means that the possibility of advanced products in the market from competitors is high. This makes it highly possible that an animation product from one company can easily be replaced with a new product (Schendl, 2016). This is especially the case in the film industry because customers often seek to watch the new films in the market and ignore the older products in the process. Therefore, the possibility of substitution is massively in the market.
In the animation industry, the primary source of success is being on the side of the consumer. There is a need for customer-driven production to tell stories or analyze issues that can connect and resonate with the targeted audience (Schendl, 2016). Therefore, many companies in the market have found targeted stories that meet certain sociocultural levels and standards. This makes such films massively successful in the local and international markets.
The Threat of Rivalry
The Anime market in Japan is made up of three core sectors; these include cartoons for television, animated films for theaters, and videocassettes and DVDs works that serve the first two sectors. The expansion of the anime market indicates that the market is around 241.7 billion Yen recorded in 2006. Its growth is driven by the iconic movies such as Pokemon, Tales from Earthsea, and Doremon as well as the surge in the television anime titles. The surge of the popularity of animation films led to increased demand for them that led the industry’s exponential growth (Schendl, 2016). Additionally, Spirited Away is another iconic movie, globally acclaimed, that fetched around $345 in the world market. Therefore, the animation industry has been a massive source of economic growth of the country. It has also displayed the Japanese culture to the world through these iconic films and cartoons as well. The increased value of the global market means that the threat of rivalry in the Japanese market is massively high. Some of the major competitors are discussed below:
Asahi Production
Asahi Production is a company in the Japanese anime industry that works in the media and entertainment industry. The firm was started in 1973, and it specializes in the production of animations. The company initially established itself as a PR and studio film company; it later diversified its portfolio to include the production of animation films, cartoons, and productions for major enterprises in the Japanese market (Brienza, 2014). At the inception of Asahi Production, the firm had affiliates such as the Tokyo Movie Company and the Tokyo Shinsah that is today referred to as the TMS Entertainment in the market. The primary business of the company was the production of promotional videos or animations for major corporations within the Japanese market. For example, the company worked with Asahi Chemical and the Japan Insurance Association (Freedman, 2016). Today, the firm is involved in the production of animation films for the Japanese market as well as the regional and international markets. Some of the major products the company has produced include Pan de Peace (2016), Million Doll (2015), Himegoto (2014), and Heroes: Legend of the Battle Disks (2013). The company is competitive with the advent of new technologies, innovation, and creativity in its production process (Madeley, 2015). This can be underscored by the popularity of its products in the Japanese and global markets.
Arms Corporation
Arms Corporation is a company based in Japan that focuses on the production and distribution of animations in the Japanese, regional, and international markets. The company has been responsible for a few major releases that have done very well in the market. For example, the famous character designer and animator Rin Shin works at Arms Corporation (Freedman, 2016). She has been responsible for several of the firm’s productions. Some of these productions such as Ikki Tousen Dragon Destiny or the Great Guardians have both received above average fan service. The company’s productions can be divided into three broad categories; these include original video animations (OVAs), specials, and TV animations. This business model gives the company a diverse product range that ensures that it targets a broad market base as well. At the same time, the competitiveness of the company can be seen in its hiring of renowned names in the animation and design aspects of their products (Madeley, 2015). Famous names behind such productions enhance the its competitive advantage in the Japanese market landscape.
A-1 Pictures
A-1 Pictures is a Kabushiki geisha subsidiary that specializes in the animation industry. The ex-Sunrise producer Mikihiro founded the firm, and it is associated with the Sony Music Entertainment in Japan’s anime industry. The company also works in three core sections of the market; these include the television series category, film productions, and the OVA/ONA sections of the market as well (Schendl, 2016). It has produced some of the popular products such as the Zenmai Zamurai and its first series referred to as Okiku Furikabutte. The firm is competitive in film production as indicated above as well as the production of animations for major companies in the Japanese consumer market.
The three companies discussed above provided an insight into the competitive nature of the animation industry in Japan. Although there are barriers to entry into the industry, the fact that many companies do not need elaborate supply chains and raw materials to me competitive has encouraged many firms to spring up competitively in this sector. This has led to a massive surge of competition for the market share. It has also led to stiff competition for the best staff in the market. In this case, these businesses are massively competing for designers and producers of characters and animations. Since the industry is heavily technology-dependent, the competition for innovative employees to drive the advent of the next big innovations and creative solutions is high as well. This is a crucial aspect of the modern anime industry because of the rush of many of these firms to seek reduced costs of production. As many of these enterprises have outsourced their manufacturing processes to South Korea and China, many of the employees in Japan have lost their jobs. Additionally, it means that there is reduced specialization in the industry, which denies the industry the requisite experience and expertise to continue to be the leading industry regionally and a formidable force globally (Schendl, 2016). However, the surge of the Chinese animation industry has posed huge competition for anime industry’s dominance of the regional market.
Future Trends in the Anime Industry
The digitization of the animation industry will continue steadily because of the advent of new technologies. For example, computer-graphics software, CGI, and other core technologies have revolutionized animation. This has helped producers to develop quality films that have a touch of reality and connection with the audience (Lim, 2016). Therefore, the core target of the industry is to enhance the quality of its productions and reduce the prices. This is because the pricing policy is crucial in influencing the consumer behavior in the market. Additionally, the anime industry will increasingly need the support of the government with the development of crucial infrastructures to allow it to be competitive regionally and globally as well. For example, the rapid progress and development of the digital communication infrastructure such as broadband Internet and digital broadcasting need the government’s hand to lay the foundations for the technology industry to thrive (Napier, 2016). The competition from China will continue growing steadily in the future. This is because the Chinese economy is growing equally fast and the Chinese authorities have decided to invest in the Chinese animation sector as a way of introducing the Chinese culture to the world.
Conclusion
The animation industry in Japan has established a crucial reputation for its quality in design, production, and the substance of the cartoons or films depicting the Japanese culture and its position in the world. This reputation is crucial in enhancing the brand equity of the industry locally and in the global market. The Japanese government’s involvement in the IT sector is crucial in enhancing the development of the needed infrastructure. This has created an enabling environment for the industry to grow and expand into the global market. Additionally, the intellectual property laws in Japan provide a massive advantage for the companies that have invested heavily in R&D and innovation. This is because such new technologies and innovative approaches to animation and business strategies provide a crucial competitive advantage in an ultra-competitive market. The future opportunities for the Japanese anime industry are hinged on the upturn of the global film industry. This will boost sales because the demand will be increased. This way, the anime sector will have the opportunity to expand globally. The popularity of DVD/Blu-ray offers the industry an avenue for expansion and growth. Additionally, the potential advent of new technologies and innovations in the future provides a chance for expansion and growth of the industry as well. Japan has established the education foundation to encourage R&D and innovation.
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APPENDICES
Appendix 1: Market Segmentation
Appendix 2: SWOT Analysis
Innovative Writers 