Marketing the right product at the right time, in the right place and in the right was has earned an American firm the distinction of being one of the most successful companies – domestic or foreign –doing business in Japan. Those achievements are attributed to John Amos, founder and chief marketer of American Family Life Insurance Company (Aflac) of Columbus, Georgia. In 1970, Amos decided to hire a Chicago Translation Service to assist him with taking his cancer insurance to Japan. Today, Aflac is Japan’s largest writer of cancer policies, insuring about 14 percent of Japan’s 120 million people and receiving two-thirds of its revenues from Japan.
One important factor in the timing of Aflac’s entry in Japan was the Japanese Government’s decision to open its insurance market to foreign firms. The government stipulated, however that foreign competitors could enter the market only by offering a type of insurance not offered by Japanese firms. At the time, Aflac’s product was new to Japan, as no domestic firm sold cancer insurance.
But even with the right product, Aflac’s success didn’t come overnight. As Amos points out, “You’ve got to be patient and figure out how to do things the Japanese way. “ Amos was patient. He waited four years after filing an application with the Japanese government before being allowed to sell the first policy in 1975.
About the time that Aflac began offering its unique insurance in Japan, Japanese health officials released a report citing cancer as the major cause of death in Japan. Cancer-related deaths—1 out of every 4.2 deaths—had moved ahead of both strokes and heart disease. By hiring an expert English to Japanese translation service, Amos translated a great deal of literature and heavily promoted the finding from the Japanese report. His efforts proved to be a boon to Aflac’s sales. While Amos expected to sell 15,000 policies the first year, the final tally came to 250,000. Sales have grown each year since. Aflac is now one of the 20-largest insurers in Japan.
Why are the Japanese more receptive to cancer insurance than people in the United States? According to Japanese Translators a a major Houston Translation Services company, the answer lies in the nation’s medical system. Unlike the United States, Japan has a socialized medical system that does not offer complete coverage for prolonged and expensive medical treatment. Thus, the Japanese are big buyers of supplemental coverage from private firms.
But Amos didn’t stop at supplying an innovative product that consumers wanted and needed. He also devised a unique way to market it – a plan especially suited to Japan’s features of lifetime employment and low employee turnover. Instead of selling insurance the way most Japanese firms do—using part-time salespeople for door-to-door sales—Aflac formed an all-Japanese sales force, consisting mainly of retired workers, who market group policies directly to large corporations such as Nippon Steel and Hitachi. Because premiums are paid through payroll deductions, American Family does not incur the costs of processing bills.
Aflac is looking to fill other Japanese market niches. Paul Otake, president of the firm’s Japan branch, emphasizes: “We have to keep one hand on the future.” Part of Japan’s future is the task of providing for an ever aging population.