The tables at the Tsubaki Salon are slightly wobbly. No more than a couple of millimeters off kilter, but enough to be noticeable.
This is puzzling because, in all other respects, this highest of high-end pancake houses, nestling among the haute-couture flagships of Tokyo’s Ginza district and fitted out in bracingly minimalist decor, is perfection. The plates and cups are the definition of Japanese ceramic elegance. The spindly handled spoons and forks have been created by one of the country’s most famous designers to fit the pinnacle of pancake Epicureanism. When it comes to the edible stars of the show — made using a complex technique — they too, in the view of the pancake cognoscenti, are flawless.
But what about that wobble? “It’s deliberate,” says Yukari Mori, nudging the table a little to demonstrate that even this imperfection is perfection. “They were designed this way to show off what makes these pancakes so good.”
Mori, a 32-year-old furniture-company employee, is something of an expert on these matters. She is a participant in the 21st century’s burgeoning experience economy, which is being driven by millennial consumers and transforming the landscape for businesses everywhere. Japan is not only an innovator in this economy but is also seen as a bellwether for the likely tastes of China and south-east Asia’s swelling middle-class consumers.
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Five years ago, Mori and a friend established a blog (“The Tacchans Pancake Club”) that set out to chronicle their adventures in the niche realm of Japan’s specialist pancake cafés. Others have mounted similar quests around strawberry parfaits, flavored popcorn, Baumkuchen cake and grilled chicken thighs. The aim is to visit establishments far and wide; Mori and her friend have between them been to more than 600 so far. In each one, a carefully choreographed routine is followed: first they order the signature pancake, with a particular emphasis on any seasonal variations. Then they lovingly pour on the syrup, photographing everything minutely. Finally, for an experience-economy coup de grâce, they take short videos of themselves plunging the cutlery deep into their prize for maximum appreciation of a pancake’s most important quality: its “fuwa-fuwa”, or fluffiness.
In Mori’s opinion — a view evidently shared by the customers currently waiting in the stairwell — it is not just the quality of the food that attracts crowds to these cafés, but also the quality of the encounter. “That is why the tables are made to wobble,” she explains. “It’s designed so that when you have your pancake in front of you, you can see how fuwa-fuwa it is by how much it jiggles on the plate when the table moves. It is extremely, extremely satisfying to watch,” she adds. “It is what makes it an experience.”
In their influential 1998 article “Welcome to the Experience Economy”, American consultants Joseph Pine and James Gilmore argued that a marketable experience occurs “when a company intentionally uses services as the stage, and goods as props, to engage individual customers in a way that creates a memorable event . . . ” These experiences were, they went on, “inherently personal, existing only in the mind of an individual who has been engaged on an emotional, physical, intellectual or even spiritual level”.
This was seen as the logical next step from the service economy, itself an evolution from the industrial economy and, prior to that, the agrarian economy. Twenty years after the term was coined, retailers and service providers are continuing the hard sell to consumers. Euromonitor, a market research provider, forecasts that global expenditure on the experience economy will reach $8.2tn by 2028.
Unsurprisingly, the driver of this trend is younger people, in particular those from the millennial generation born between 1981 and 1996, according to Pew Research Center’s definition. A report published last year by Eventbrite, a ticketing platform for live experiences, found that more than three in four American millennials would rather spend money on a desirable experience or event than buy a desirable object.
In Japan, notoriously long working hours have made time-poverty one of the defining features of the country’s leisure sector. The market has responded, over many decades, by refining and packaging experience in the most efficient, deliverable way. At one end of that scale is the 90-minute session in a themed karaoke room, with microphone settings that flatter the flattest voice; at the other is the fiercely compacted relaxation of a $200-odd one-night stay and kaiseki banquet at an onsen hot-spring inn.
The millennial generation — and the growth of social media — has taken this economy in some unexpected directions. Instagram is to thank for the birth of “Oshapiku” — a compound of “oshare” (fancy) and “picnic”, where the emphasis is on meeting up, dressing up and engaging in the most photogenic picnic imaginable. One of the surprise trends of the past few years, say operators of Japan’s ubiquitous “love hotels”, designed for sexual encounters between couples, has been their use by groups of women who simply “want to dress up nicely and meet their friends in an unusual, slightly thrilling place out of the public eye”. It is an effect, say the hotel operators, of Japan’s intensifying urbanization, and the fact that millennials cannot afford homes large enough to host their friends in.
Other businesses have evolved rapidly for the millennial experience economy. As far back as the early 2000s, cafés where visitors could sit among dogs and cats were opening in Japan. A decade and a half later, the Instagram generation needs something more exotic. In the cramped confines of Ikefukurou Cafe, on the sixth floor of a commercial building in Tokyo’s Ikebukuro district, 37 owls are available for petting and as a nice accompaniment to a cup of coffee. The place is so busy with both Japanese and overseas tourists, says its manager, that they have had to adopt a strict system of appointment slots. “We’ve been looking forward to this for months,” says Ellie Chao from Taiwan, stroking a small barn owl. “This place is pretty famous online now and a huge number of Taiwanese people come here…This is one of the reasons to come to Tokyo.”
“Experiences are king,” the consultancy McKinsey stated last year in a report arguing that, “in recent years, faced with the choice of buying a trendy designer jacket or a shiny new appliance or of attending a show, consumers increasingly opt for the show and, more broadly, for experiences with their friends and families.” Businesses everywhere have had to adapt to this. Howard Schultz, who recently stepped down as executive chairman at Starbucks, told investors that any retailer who is “going to win in this new environment must become an experiential destination”.
Yohei Harada, head of the Youth Research Centre of Japan’s Hakuhodo advertising agency, notes that, as far back as two decades ago, the Japanese car manufacturer Nissan recognized the importance of the experience economy for younger Japanese. It ran a series of TV adverts with a “memories are more important than things” slogan, but suggested that owning a car and driving around Japan with family and friends was a good way to accumulate those memories.
Yet today, the country’s vast auto industry is among those frustrated by the emergence of the experience economy. Japanese in their twenties and thirties are just not interested in car ownership in the way that previous generations were. The move away from things and towards experience is accelerating fast, says Harada, and compared with other countries, “Japan is overwhelmingly advanced”.
Japan’s experience economy has evolved along two distinct avenues. On one side an already fully fledged leisure, dining and hospitality sector has sought ever more inventive ways of packaging experience — from hotels staffed by robots and limited-edition Shinkansen bullet trains fitted out with Hello Kitty decor to many of the country’s aquariums offering the opportunity to camp overnight surrounded by the relaxing pulsations of bioluminescent jellyfish.
The other side, says Mori, has to an extent developed as a branch of Japan’s “otaku” culture. This originally referred to the obsessive focus on particular areas of popular culture such as animation, video games or comics but is now more generally applied to a tendency to single-minded connoisseurship.
In one very prominent area there has been a direct fusion. Cosplay— a mingling of “costume” and “play” — expands the fandom of video games and animation into an active hobby of dressing up as one’s favorite character. The genre, propelled by social media, has extended far beyond Japan, and large communities of cosplayers now exist all around the globe. What was once a private hobby has been transformed into an experience industry. The annual Tokyo Comic Market fair used to exist primarily for buying and selling comics but has now developed into one of the world’s biggest cosplay events. Over three days in 2017, some 550,000 people attended.
“There are actually three sides to the experience economy in cosplay,” says Eri Nakashima, the manager of the Polka Polka second-hand cosplay costume store in central Tokyo. “There is the basic passion for becoming a different character from the one you are in everyday life; there is the participation in a community that shares that; and there is the creativity of making the costume perfect.”
This notion of community has become a pattern of growth for the experience economy. The enthusiasm of the Tacchans Pancake Club’s founders also actively expands their mission with each passing day. Every time either Mori or her colleague posts on a new pancake house, their tweets and Instagrams are followed by tens of thousands of other fanatics. Some 80 per cent of those readers, in her judgment, are young, millennial working women: they have the funds to enter the shared quest for the perfect pancake, they have a preference for experience over accumulation of things, and they are relentless pursuers of novelty. Because of Mori and the popularity of blogs like hers, Japan has opened scores of new pancake cafés over the past couple of years to meet the millennial demand.
In early 2013, shortly after Shinzo Abe became prime minister, he reasserted what seemed at the time a bold target of 20 million overseas visitors a year by 2020. To get there from the 2012 total of 8.4 million seemed a huge stretch but, say leisure sector experts, the government’s analysts had reckoned without the lure of Japan’s experience economy to Chinese and other nationalities.
Shopping remains a huge draw for these tourists: the country’s retailers continue to thrive on the high average spending (£1,000) of middle-class visitors from China, Taiwan, Vietnam and elsewhere. But, by the end of 2017, when the government’s target was obliterated and 28 million tourists arrived during one year, it was clear that Japan’s long history of perfecting short, sharp experiential offerings — from onsen springs to pancakes — had won a new generation of admirers from overseas.
According to Mori, Japan’s tendency towards connoisseurship — part of the reason that waiting for an experience is often regarded as a necessary ingredient to enjoyment — continues to be a powerful part of its appeal. The country’s manufacturers have long made a fetish of monozukuri — the quality of “thing-making” artisanship — to actively encourage people to own more stuff. But today the instinct to collect and accumulate things has, she says, been replaced by a desire to collect and accumulate experiences — and, in time-honored Japanese fashion, to building ever larger libraries of images.
Back in 2000, Japan was the first country to add the ability to share photographs to the features of a mobile phone. But long before that its manufacturers recognized that taking pictures of any given experience was a crucially important part of the enjoyment. The Japanese companies Canon, Olympus, Konica, Minolta and Nikon were some of the most successful camera makers on the planet: the passion behind them was not just about the physical machinery but about a recognition that picture-taking dramatically enhances the consumption of experience.
The modern Japanese expression of that idea is “insta-bae”, a word that combines “Instagram” with the Japanese verb haeru — “to shine”. In December last year, the word received the ultimate accolade when it won the Jiyu Kokuminsha publishing house “word of the year” award.
It is a term, says Harada, that could not be more critical to understanding the experience economy. It also explains the pancake phenomenon. However delicious those pancakes are, the fascination (aided by that wobbly table) derives from the visuals of the food itself and the setting. The word insta-bae, which first emerged about five years ago and then lived primarily in the vocabulary of schoolgirls and young women, was originally used as an adjective to describe something (a place, an outfit, an object, a plate of food) that you could immediately tell would look good when posted on Instagram and shared on social media. The word, to wide surprise, became as prevalent as “kawaii” (“cute”) as the ultimate term of praise.
Quite quickly, however, its meaning began to broaden. Insta-bae became not just a description of something you had seen but an explicit target to seek out. The experience economy, says Harada, is increasingly built around people going in search of experiences that are insta-bae. “Until now, it was understood that you chose somewhere you wanted to go and you would then take pictures. Now, in the experience economy, that is reversed: you go somewhere because there is a particular photo you want to take.”
To monetize this sensation, everyone from ice-cream vendors to rural tourist spots has rushed to join in. In Tokyo’s trendy Harajuku district, food stalls are now in an arms race to create dishes and individual sweets more insta-bae than those of their competitors across the street.
Yet there is skepticism over both the long-term economic prospects for Japan’s experience economy and the fundamental analysis of why it is happening.
It is worth remembering, says Yoshihiro Oishi, a professor at Meiji University business school, that unlike their counterparts elsewhere in the world, Japan’s millennials have, broadly speaking, only ever grown up with the Japanese economy in a state of deflation, with stagnant wages. The experience economy, he suggests, may have as much to do with them finding ways to justify their financial inability to participate in the same style of goods-accumulation as their parents.
“The consensus is that they prefer experience to goods. But it is a very superficial consensus,” says Oishi. “The millennials are, in fact, poor — much more so than Generation X. And, of course, there are goods all around them that they very much want. They cannot have those, so they choose experience. Look closely at the experiences they go for — they are close by where they live and work, they are cheaper.”
Millennials around the world have experienced similar economic pain, from the financial crisis of 2008 to rising house prices. Oishi believes this experience has created a generation that is more divided economically than previous ones. He suggests that, in Japan, perhaps 40 per cent of adult millennials have a tertiary education and a stable job in a large company. Those people, he says, can afford to dream in terms of ownership of houses and cars and trips overseas. Poorer millennials cannot, and have gone in a different direction.
But Hiroshi Ishida, a Tokyo University researcher who has been running an 11-year research project on the “life course” of young Japanese, says that a more important division emerges when millennials are asked to compare the lives they have now with what they expect to happen in the future. Current levels of satisfaction, he says, are pretty high, but when you ask about the future, their anxiety is also relatively high. “Because of that, there is a feeling that they want to collect experiences of value now while they can,” said Ishida. “It is partly a feeling of investment.”
After a joyous savoring of her pancake, Yukari Mori lays down the long, exquisite cake fork, notices how much we have admired them and points to a small shelf near the counter where they are for sale. “The generation before was the thing-collection generation. Those are for them,” she says.
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