Digital advertising is becoming ever more important to advertisers worldwide, and Japan is no exception. Underlying this development is a change in the media usage of consumers, who increasingly spend time online instead of engaging with traditional media, such as newspapers or television. This is particularly true for young people, who represent an attractive target group for many companies. As a result, the internet recorded strong growth in ad expenditures in recent years and overtook television as the leading advertising medium in Japan in 2019. This constituted a major shift for the
, as television had been the country's main advertising medium for many decades.
Makeup of the digital advertising market
Compared to traditional forms of advertising, digital advertising, in many cases, has the advantage of higher flexibility and precision. Many types of digital ads can be used shortly after being created, and changes to their content and placement can be made if necessary, leaving room for optimization. Detailed information on users, usually gathered via cookies, helps improve the precision of advertisements.
The
total internet ad expenditure in Japan consists of expenditures on media, production costs, and merchandise-related e-commerce platforms. Among expenditures on media, performance-based advertising is by far the leading transaction method, which shows that many advertisers make use of the aforementioned strengths of digital advertising. The major advertising categories are paid search, display, video, and affiliate advertising. One further distinction can be made between non-social advertising and social advertising. Social advertising mainly refers to ads on social media and video-sharing services. One type of marketing that falls into this category and has garnered attention in recent years is
influencer marketing, which utilizes the personal link between influencers and their audiences.
Recent data privacy legislation
The practice of gathering information on users has also generated concern over privacy issues. Survey data show that the concept of tracking for online advertising purposes
is not well-understood by many people in Japan. Following a major scandal involving the job-searching portal Rikunabi, whose operator had sold algorithmic scores on job seekers to potential employers, the Act on the Protection of Personal Information (APPI) was revised in 2020 in order to improve the protection of user data. The amended APPI came into effect in April 2022 and closed some loopholes that had previously been exploited by companies. Among other things, it changed the cookie consent requirements for third-party cookies and introduced a new personal data category, called “personally referable information” (PRI). This category refers to data that is less concrete than personal information (PI) but could theoretically be used to identify individuals with the help of further data. The amended APPI requires active consent of users for third-party cookies that can be regarded as PRI according to its stipulations.
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