Editor’s Note: Sadly, the store discussed here closed prematurely due to space leasing issues. I’ll update this article again if they manage to re-open.
I’m fascinated lately by the ways that Japanese businesses are changing their business plans to attract customers and build loyalty.
I wrote last year, for example, about how some places in Tokyo were looking at subscription models for food and booze to encourage repeat business. And last year, TechCrunch Japan reported on a new service, GuBit, that lets you pay a mere ¥980 a month (around USD $9), for which you can get a single drink every day for free at over 500 participating restaurants. The idea, of course, is that you’ll overstay your welcome and pour even more of your hard-earned cash into that business’ coffers.
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But now a new restaurant in Tokyo’s Chiyoda Ward has announced it’ll take an even more innovative approach. The Essence of Japanese Sake (日本酒の本質; nihonshu no honshitsu) is a new izakaya-style restaurant started by the company Forbul, and run by sake enthusiast and entrepreneur Hirano Seiya (平野 晟也).
Izakayas are bars that emphasize small plates of a large variety of dishes served with alcohol, such as sake, beer, or whiskey. Some izakayas take particular pride in their choice of sake, and offer a curated, rotating selection. Essence of Japanese Sake is also placing great emphasis on its sake curation skills. But it’s doing so with a twist: it’s telling diners that they can eat and drink all they want, and decide what to pay when they’re done.
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Essence’s menu appears it will be a little more sparse than many izakaya: food will consist primarily of 10 types of pickled vegetables (漬物; tsukemono), rice and juurokukoku (a mix with 16 different types of rice, grains and beans), miso soup, and tea. However, patrons will be able to ask for unlimited refills. But the real star of the shop is its sake, which customers are also invited to indulge in until they drop. The site says that its goal is to pick sake that pairs excellently with the food it’s serving.
The Philosophy Behind “Name Your Own Price”
Why offer a name-your-own-price service? Hirano writes that he wants to remove the distortion caused by price, so that people can enjoy an individual sake on its own merits.
ワインを使った面白い実験があります。同じワインを同じグラスに入れ、別々の値段をつけて愛好家に飲み比べてもらいます。一つは10ドル、もう一つは90ドルという値札をつけました。すると、高い値札をつけた方が満足度が高かったそうです。これを「名声価格」と呼びます。
There was an interesting experiment done with wine. People poured wine into the same glass, gave the wines different prices, and asked wine lovers to compare them. One was 10 dollars, another was priced at 90 dollars. The result was that the wine tagged as more expensive earned a higher degree of satisfaction. We call this “Prestige Pricing.”
A related reason, perhaps, is that the owner confesses, “We are absolute amateurs with zero experience in the food industry.” But Hirano touts this is a benefit. “By instituting a ‘Pay Your Own Price’ model, we can operate such that we don’t fall short of your expectations, and you pay a price you’re satisfied with.”
While all that is fascinating in itself, the restaurant is doing one more thing that’s innovative. Hirano says that he’ll make all of the data the restaurant receives on how much people volunteered to pay for their meals open to the public. This could provide some valuable insight into exactly how well such a model might work as a business model – something that I’m sure many other restauranteurs will be fascinated to dig through.
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The Catch(es)
Now, some of you may be asking, “Wait…what’s the catch?” Well, there are two. Actually, three if you don’t speak Japanese.
First, Essence of Japanese Sake will only be open twice a month. The dates vary, and customers are urged to follow the restaurant’s LINE account for availability dates. Reservations are required, so you’ll want to get your name down as days become available.
Second, this is an experiment…and one that could easily fail. If the restaurant falls into the red during its first three months, says Hirano, they’ll shut it down. So if you’re in Japan already, don’t dawdle!
Third, going to Essence will require some knowledge of Japanese…at least initially. I asked Hirano via email whether they are considering changing that, and he replied that that’s definitely on their radar. “Later, we’ll want to implement support for foreign language menus, and service that caters to foreign visitors.”
Long-time readers of Unseen Japan know how much I love good sake. While I’m very hyped to try Essence, I’m worried I might not get the chance. Our next trip back to Japan isn’t until October, which is the restaurant’s self-stated cut-off mark for profitability. I’m praying for a 商売繁盛 (shoubai hanjou; prosperous business) that keeps this concept running for a very long time…or, at least, long enough for me to sample what Hirano and crew have to offer.