The Nooks and Niches of Japan: Part 2

Examining Japan's retail landscape as an analog version of the Creator Economy

When I was a child, my mother used to let me accompany her on a special errand to an engraving store in Los Angeles’ San Pedro harbor. Every year, for their wedding anniversary, my parents exchanged Waterford crystal champagne flutes, engraving their names and the year on the bases of the glasses. I found this tradition to be a romantic and sentimental ritual. The tiny engraving store – nestled between a candy shop and a fish market – was filled with crystal, silver, and bronze artifacts waiting for the engraver to etch meaning and memories into their surfaces with delicate craftsmanship.

Years later, in February 2024, I found myself in Los Angeles seeking a similar engraving experience for my wedding band. This quest led me to Engraving by Emil, a hidden gem on the second floor of a 1980’s commercial building next to a dental office in Beverly Hills. Stepping into this brick-and-mortar business felt like a nostalgic journey—a reminder of the fading essence of personalized craftsmanship in today’s digital age. Reflecting on the decline of such businesses in the U.S., I couldn't help but wonder about the fate of our artisans and craftspeople, with real estate pressures and evolving consumer habits posing significant challenges. 

In stark contrast, while traveling in Japan earlier this spring, I noticed that its retail landscape is filled with hyper-specific mom & pop shops that do one thing and do it well. They seem to serve as an analog version of the digital creator economy that I’ve been immersed in for the last decade. For those unfamiliar with the term, the creator economy is a growing field of people who make money by leveraging their creative talents using digital platforms to connect with their audiences. What started out as influencers creating ads for brands has evolved into an entire ecosystem that essentially treats individuals with internet audiences as small – and sometimes very large – businesses. This creator economy overview written by venture capital firm SignalFire is a bit outdated but still excellent if you’re interested in learning more. 

Brick and mortar retail predates the creator economy, and Japan’s niche businesses developed within the retail landscape across major cities such as Kyoto, Tokyo, and Osaka in ways that are independent of the fracturing of targeting and messaging seen on social media. Nevertheless, I believe there is opportunity for niche digital businesses to draw upon aspects of the brick and mortar businesses that I fell in love with in Japan.  

In Japan, these shops were not mere storefronts but cultural treasures. After my husband and I ate our way through Kyoto’s Nishiki Market, a seemingly endless arcade with a large portion dedicated to food stalls serving small bites of wagyu beef, gyozas, barbecued eel, and fried octopus balls, we ventured into the retail section of the arcade to do some shopping. As we wove in and out of clothing shops, we noticed two women dressed in floral kimonos with their locks twisted into elaborate hairdos walking into a mysterious cafe. Intrigued, we followed them into the cafe and were immediately transported into a retro cream soda shop. The maximalist decor and scale of Shin-Setsu’s Cream Soda Cafe created an atmosphere that was both a calming respite from the bustling arcade and a 1970’s fever dream that felt exciting and invigorating. The salmon pink walls were covered with pop art, and the shelves were lined with fruit-themed magazines, kitsch, and displays of every available soda float flavor.

Later that evening, we decided to go to Bar Ixey for cocktails. Located on the third floor of a commercial building near the Shirakawa River in Gion, Bar Ixey specializes in what they call “perfume drinks” - serving a collection of both globally imported and homemade herbal liqueurs made from hundreds of different types of flowers and plants. Although the interior of the six-person capacity bar was warm and intimate, I felt intimidated by the countless unrecognizable bottles of liquor lined up on the shelves behind the bar. Luckily for me, the extraordinarily knowledgeable owner and bartender, Hiroaki Oda, graciously took the time to explain the contents of any bottle that piqued our curiosity and – depending on how it sounded – he mixed together a drink incorporating the exotic new ingredient. For the folks who didn’t ask about specific bottles, I noticed that Oda would simply ask what they like to drink and customize a version of a traditional cocktail with one of his niche liquors. It’s not surprising that, while he is surrounded by intoxicating aromas such as fig leaf, rose, moss, and sandalwood, Oda likens making cocktails to writing haikus—drawing inspiration from natural beauty as well as literature.

The next day, while I was doing my laundry in the basement of my hotel in Kyoto, I met a couple that had just spent two weeks in Tokyo. Since I was headed there the next day, I asked them if they had one recommendation that I couldn’t miss. Without hesitation, they told me I had to go to Shirohige’s Cream Puff Factory in Tokyo’s Setagaya neighborhood. This bakery is renowned for crafting cream puffs shaped like Totoro, a beloved character from Hayao Miyazaki’s My Neighbor Totoro. For context, Miyazaki is often considered Japan’s Walt Disney, and Totoro, residing in the hollow of an enormous camphor tree, is iconic. Interestingly, Shirohige’s is the only spot with official permission from Studio Ghibli to create Totoro-themed treats.

While I don’t typically gravitate towards cream puffs, the fact that my husband and I couldn’t get tickets to the Ghibli museum or theme park made the decision to trek an hour from our hotel to the bakery an easy one. After meandering down a residential street, we found a standalone cottage with a wooden sign that read Shirohige’s Bakery. We walked into the cottage entryway and up narrow wooden stairs covered in forest green carpet. I peeked over my shoulder and could see four bakers pulling the light brown Totoro-shaped cream puffs shells out of the oven and methodically filling them with strawberry, chocolate, and custard-flavored filling. We sat down at a table on the second floor of the cottage and noticed the assemblage of objects on the shelves: stuffed animals and figurines from Miyazaki films, glass Campari bottles from the 1970’s, victorian-style tea cups, jazz records, and more. Food and atmosphere play a big role in Miyazaki’s films, and eating a specific dish in a whimsical setting made the experience an unforgettable one.

The role of atmosphere, community connections, craftsmanship, and personalized experiences in these niche businesses serve as a stark contrast to the high-end “general stores” (selling the same overpriced tinned fish, candles, and ceramics), big box retailers, and banal coffee shops that proliferate the stretch of Sunset Blvd in my neighborhood of Silver Lake, L.A. Silver Lake, once filled with charming independently owned and operated shops, has morphed into a late capitalist endless sea of sameness. 

We are, however, seeing creativity and specificity in spades on the Internet. While I strongly believe that nothing (sorry Zuck) will replace the sensory experience of smelling an herbal liqueur infused cocktail, meeting tourists while waiting in line to eat a cream puff in the shape of an amorphous bear-like spirit, or tasting cream soda in a cafe drenched in bright colors and mismatched patterns, I do believe there are some things that digital businesses can learn from their analog predecessors. 

Double Down on Niche Interests 

Niche interests tend to do very well on social media (I say this with a heavy heart as a generalist). For instance, when I was hatching chickens for my parents while living with them during the pandemic, I became obsessed with YouTube videos and forums that taught me everything I needed to know about bringing these feathery creatures into the world. 

If I had taken things one step further, I could have become a digital creator in the niche of backyard hens like Kate Richards. What I love about this account is that she’s not simply documenting her chickens— she has a very specific visual identity that immerses her viewers into her vibrant and kooky world of colorful cocktails and backyard hens. In a way, the attention to style and atmosphere makes it feel similar to the in-person experience of the Cream Soda Cafe in Kyoto. You can find everything from baking to nail art to flower arranging to WarHammer experts creating content surrounding their interests and hobbies (and businesses based on the content).

Highlight Unique Offerings and Showcasing Craftsmanship 

There are also niche product and service-based businesses that have social media presence to promote their work. My good friends Gallagher Hannan and David Erickson run Boxco Studio, a custom cabinetry company specializing in modern plywood kitchen cabinets. Although I’m not in the market for custom kitchen cabinets, I love following their Instagram account. Their videos and images clearly tell a story of a small-business of dedicated artisans who use their design expertise, love of color, and excellent craftsmanship to build new or transform existing kitchens into joyful spaces where their clients will make memories for years to come. 

There is a difference, of course, between a niche business like Boxco marketing itself on social media channels versus a creator making content as art or entertainment that you consume but can’t always purchase. One of my favorite artists that we used to work with when I was at Twitter is Jason Seif. He has perfected the craft of painting recreations of old Persian rugs on canvases and objects. Many years ago, we hired him to create this advertisement for Nike. Since then, he has gone on to show his work in galleries all over the world and was featured on the cover of GQ Middle East. Just like the Totoro cream puff bakers, Boxco Studio and Jason Seif do one thing, and they do it very well—making it easier to carve out a niche in the enormous and highly competitive markets. 

Community and Personalization   

I loved the way that the bartender from Bar Ixey drew in and educated his customers using personalization. This made me feel like I was being taken care of and listened to, which all human beings love. 

Speaking of personalized experiences, my friend Priya Parker is a facilitator, writer and strategic advisor who specializes in creating meaningful gatherings. Whether it’s thousand-person conferences, political rallies, baby showers, weddings, business meetings, or funerals, Priya applies a framework detailed in her fabulous book The Art of Gathering that can make any gathering of people a transformational experience. To me, what stands out is her engagement with her community through platforms like Instagram and her newsletter. Priya actively seeks feedback and stories from her audience, making them feel heard and involved. This personal touch enhances the quality and relevance of the content and strategic advice she shares, making it genuinely useful and specific to her audience's needs.

My journey through Japan's vibrant niche businesses and unique experiences highlighted the value of immersive atmosphere, personalized craftsmanship, and community engagement. These elements not only differentiate small businesses from their larger, generic counterparts, but also provide a blueprint for digital creators and businesses seeking to stand out in a crowded digital landscape. By embracing niche interests, highlighting unique offerings, and fostering community connections, both physical and digital enterprises can create lasting impressions and meaningful interactions that resonate with their audiences. As we navigate the evolving dynamics of retail and digital economies and stave off the existential threats of and/or evolve with A.I., it's helpful to remember what makes these experiences feel more human — personalization, craftsmanship, and a heavy dose of creativity that transcends transactions and transforms moments into memories.