Red Bull powers it's way into Japan with the help of Sanko Estate.
With a yearly production of more than 3 billion cans in 130 countries, Red Bull is by far and away the world's No. 1 energy drink. Red Bull is currently expanding throughout Asia and recently opened their first office in Japan with the help of Sanko Estate. Mr. Selim Chidiac, the Head of the Asia Pacific, Middle East, Africa and Chairman of Red Bull Japan was interviewed independently and shared some of his experiences on Red Bull's move into Japan.
Q. Red Bull's headquarters are architecturally quite spectacular, can you tell us about it?
A. That's right. Our office building headquarters are shaped like two volcanos, which represents, by definition, ongoing energy. I don't know of any other international company that has its headquarters in a village of just 1000 people. Fuschl is 30 minutes away from Salzburg, which is the second biggest city in Austria. And originally our founder opened our offices there.
Q. What were the most important priorities when choosing a location for your office in Tokyo?
A. Initially, the first time I met Izutsu-san (Assistant Manager of the International Department at Sanko Estate) I said to him that I wanted to have 'a house', 'a villa' in the center of the city. I remember him scratching his head thinking "this guy has never been to Tokyo before!" [laughter]. Why a villa? Why a house? In some other countries we have a warehouse that we adapt to our needs simply because you have your own identity, (unlike sharing space in a large high-rise building). You can have a close team environment, peaceful, you can think, it's quieter, and we can build the core and team spirit of the company - this is really the most important ingredient for us.
Plus we needed parking space so our marketing and sales teams can react efficiently - as you probably saw our cars are parked outside - we needed to have plenty of "high parking" access on the ground. This confused Mr. Izutsu at first, he asked if we had trucks - now he knows why (see photo below). It was quite a challenge, but we eventually found our location in Shirokanedai.
Q. And Shirokanedai is actually a well-established residential area. How have your clients reacted to such an address?
A. It has triggered questions and but on the whole it has triggered positive word-of-mouth. People assume from the address that we are different, and everything that we are doing in Japan is quite different - our marketing approach, or sales approach are all very different than what Japan is used to.
The concept when entering our office is that you don't feel like you are in an office. The reception has a bar, with a large video screen and music. You feel like you are in a home, in a relaxed area. You feel like you are in a different environment. And so when clients visit our address, they see that it makes sense and matches our identity.
Q. Did you see many prospective locations before deciding?
A. I saw a lot. I was working with several agencies to be honest. The good thing that I have say, is that Izutsu-san did not show me many locations. I think he showed me about 3 or 4. The other 3 agencies that were working on the project each showed me about 10-15 locations.
Q. So you would say he did not waste your time.
A. He did not waste my time. Compared to the other agencies, this was really true.
Q. Were you familiar with the real estate system before you came to Japan?
A. Not really, Sanko assisted us out with our questions during the process. Izutsu-san was very helpful in negotiating the contract, which was difficult. He was very much involved because we did not accept all the clauses. When you are new company to Japan, you are expected to agree to everything - which we did not do - we were very challenging.
Q. And you were happy with the way Sanko represented you?
A. Yes I felt it was well handled. It's difficult for them (Sanko), because the land lord has to trust you and you have to defend his interests, so can't only defend the interests of the clients.
Q. How long did the negotiation process take?
A. I would say a little over a month. Actually it was funny. During the process, they asked us for a company brochure - because we are not a well-known company in Japan - and I laughed! I told Izutsu-san that I did not have a company brochure. we have only CDs, Events, DVDs, a website - and Izutsu-san was panicking telling me "this is not what these guys expect!" [laughter]. It was a very interesting experience, but then I brought magazines from Forbes, Business Week, Financial Times, where we had articles about the company and our founder. And these proved to be very reassuring for them.
Q. Would you say the consumer is different in Japan in comparison to other countries?
A. Well, in our opinion the consumer is different in every country.but overall, we have to stick to our identity, we have to stick to who we are. We have to follow are international guidelines, while on the other hand we have to make some local fine-tuning - and that's a very delicate balance - what do you customize, what do you localize, what do you defend. In different markets, you adapt differently.
Q. What's the core? What's the core of Red Bull that will never change?
A. The core that will never change is our philosophy, our way of thinking. Because Red Bull is more than just a product, it's a lifestyle. It's our culture. It's focusing on different individuals who believe in the product. We are not a mass product. We are very much a brand that respects different individuals, and we have to develop this one-to-one communication. And I tell you that we are obsessed with quality of our product.
Q. Speaking about the quality of the product, where are the cans produced?
A. In Austria. All 3 billion cans around the world are produced in one location only.
Q. What kind of advice would you give others when searching for office space in Japan?
A. Overall, I would say make up your mind on what you want and think about what your plan is the first 2-3 years in order not to move offices when your business is expanding. Brief your real estate agent, spend some time with them because the more time you invest up front the less time you will likely spend finding the place you want. The choice of an office is very important - it's the place where people spend a large part of their day - people get excited, get motivated, or get frustrated. I think it's a breath of fresh air for our employees to be working in a space like this. It also helps to attract good people, which is important here because the Japanese are risk-averse and don't easily change from one company to another.
Mr. Selim Chidiac
Head of Region Asia Pacific, Middle East, Africa
Chairman of Red Bull Japan Co., Ltd.
www.redbull.jp