One of the first things newcomers notice when walking Tokyo streets—besides the abundance of people—is the abundance of vending machines. In most parts of the city you can't walk more than 50 or 100 meters without coming across coin-operated dispensers of one kind or another—heck I can count
16 27* different soft drink machines within a two-minutes' walk from my front door.
As has been noted by countless observers, the diversity of Japan's vending machines is breathtaking. Especially in days gone by it seemed like there wasn't anything you couldn't get from a machine—sodas, newspapers, cigarettes, beer, whiskey and condoms were just the beginning. A burning curiousity, a keen eye and a bit of shoe leather were all you needed to discover machines for flowers, rice, cameras, magazines, eggs, batteries, fish bait, videos, umbrellas, and fetish items for dirty old men.
But one kind of machine that you couldn't, and still can't find in Japan happens to be one of the most common in many western countries—the snackfood/candy machine. No, I'm not talking about gumball dispensers and single-serving candy holders like you find at supermarket entrances—Japan has plenty of those. I'm referring to the jumbo vending machines you find in office buildings, schools and trains stations—the ones holding chips, candy, chocolate bars and gum. Perhaps because of the upfront investment costs, or perhaps out of sheer lack of imagination, Japanese snackfood and confectionery manufacturers have neglected what appears to be a very high-potential distribution channel.
Recently Nestle Japan announced that it had taken steps into this arena with a national roll-out involving street-side dispensers. That's interesting news in and of itself—but what's even more compelling is the clever way they've gone about it.
Rather than spend a huge amount of time and money developing proprietary machines and installing them nationwide, Nestle has cleverly invented a way of piggybacking on existing infrastructure. They've come out with new packaging that allows Kit Kats to be sold through the 2.7 million beverage vending machines that already populate every village, town and city in Japan.
The Kit Kat Jar is shaped like a soda can, holds four individual packs and costs ¥200. Conceivably, getting your chocolate fix in Japan is now going to be as easy as walking up to the closest soda machine, popping in some coins and hitting the Kit Kat button.
As far as I'm concerned, the idea is brilliant. It's not just a way of broadening distribution, but a way to reinforce the brand positioning while expanding eating occasions, since chocolate is an excellent accompaniment to the teas and coffees typically found in Japan's vending machines. What better way to "take a break" than with a Kit Kat and a soft drink? It's a first for Japan and could be the harbinger of things to come from other manufacturers who'll be quick to respond with their own products if Kit Kat does well.
Now all that remains is to see whether Nestle can achieve meaningful levels of distribution. Will we start seeing the products in machines owned by Coca Cola, Kirin, Suntory or Asahi? Or will Kit Kat Jars be limited to machines owned by lesser players like JR East and Pokka?
It's going to be interesting to watch how this turns out. If Kit Kat succeeds, not only will we see other brands joining in, we may see all kinds of new extensions — like drinks based on the chocolate brands themselves (anybody for Kit Kat Kola? How about Kit Kat Koffee?)
* Having gone out and done an actual count, I was stunned to find that there are actually 27 beverage vending machines and five cigarette dispensers nearby.
© 2007 Michael Fiorella and Japan Marketing News.