Leaving the price war in rice cookers for the premium line (1987)

Choosing not to fight on price

What Zojirushi did was not to make its products more expensive but to step off the ground where large appliance makers push with plant and volume, and move the contest to axes that are hard to imitate: concept and design. It sent salespeople to spend time on the shop floor, where they found demand among older customers, and pushed forward a rice cooker that did not look like an appliance, with a finish suggesting lacquerware. The substance of President Ichikawa Hirokuni’s phrase — do not fight head-on — can be seen there.

Premiumisation alone did not clear the losses, however. Over the same two years the company cut ¥2.5 billion of costs through its 15% reduction drive, and only by running attack and defence together did it return to profit. Nor was the 1987 choice a victory settled once. In the 2000s cheap Chinese products pushed it back into two consecutive years of losses, and it rebuilt again with the same combination of higher value-added products and overseas markets. Choosing to separate one’s ground from whoever competes on price is work that has to be redone each time a new challenger appears.