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Yakult’s research activities: The inheritance and practice of Shirota-ism

• Osamu Chonan 0

Research Management Center, Yakult Central Institute, 5-11 Izumi, Kunitachi-shi, Tokyo, 186-8650, Japan

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Yakult's business activities began with founder Dr Minoru Shirota’s pursuit to build a body that is resilient to disease. The origins for Dr Shirota’s beliefs are in the philosophy of Shirota-ism, which encompasses the concepts of preventive medicine, the idea that a healthy intestinal tract leads to a long life, and to offer products at a price that everyone can afford. Shirota-ism has withstood the test of time and continues in the research and development activities at the Yakult Central Institute.

Figure 1: Analysis of intestinal epithelial cells with a confocal laser scanning microscope. The induction of Th17 cells by segmented filamentous bacteria was visualized using a technique called immunofluorescence.

Here we describe our efforts to address the ultimate challenge: to understand the significance of gut microbiota in maintaining human health and to share the results of our probiotic studies.

From the intestinal tract to the entire body

The Yakult Central Institute fulfils its aim to support the foundation of probiotic research by scientifically verifying the effect that microbes inhabiting the intestine have on the human body from both clinical andnon-clinical perspectives. The human intestinal tract contains approximately 1,000 different species of bacteria that form the gut microbiota. Gut microbiota have a variety of physiological effects on the host. Research on gut microbiota has rapidly developed on an international scale in recent years. The influences of gut microbiota on the host are not limited to intestinal diseases, but can also have an effect on cancer and mental health. The Yakult Central Institute uses a variety of methods, including the latest gene sequencing analysis and technology to isolate intestinal bacteria. The research is helping Yakult scientists to discover how the type and composition of intestinal bacteria are connected to the onset of illness and to elucidate the functions of gut microbiota, including the effects on the health of the host, from the perspective of preventive medicine.

Advanced research capabilities

Through our research on gut microbiota we have shown that Bifidobacterium longum is passed on from mother to newborn during vaginal delivery 1 . We also demonstrated that segmented filamentous bacteria (intestinal bacteria present in a wide range of mammals) are involved in the induction of Th17 cells, which are helper T cells that play an important part in the cellular immune response 2 (Fig. 1). Additionally, Yakult Central Institute has established a system that enables precise and extensive analysis of gut microbiota called YIF-SCAN ® 3 . Based on genetic sequences that are unique to each species of intestinal bacteria, YIF-SCAN ® selectively quantifies the bacteria, enabling us to rapidly identify a wide range of bacteria, from highly populous bacteria to those that are relatively few in number.

Proprietary probiotics

The idea of using microorganisms such as Lactobacilli and Bifidobacterium as probiotics to contribute to human health has gathered increasing attention in recent years. The concept is identical to the ideas of ‘preventive medicine’ and ‘a healthy intestinal tract leads to a long life’ that were advocated by the company’s founder, Dr Shirota. The Yakult Central Institute has focused on the potential of microorganisms since it was founded and continues its tireless research to develop products aimed at contributing to people’s health. Among the probiotics investigated at the institute are Lactobacillus casei strain Shirota and Bifidobacterium breve strain Yakult, and through safety studies and long-term consumption trials we have confirmed that these probiotics survive digestive juices such as gastric fluid, reach the intestines alive, and produce beneficial effects 4 , 5 .

F igure 2: Lactobacillus casei strain Shirota (stained green) incorporated in a macrophage (the cytoplasm is stained red and the nucleus is stained blue). Findings suggested that the macrophage is key to the immune regulation of L. casei strain Shirota.

Cancer and infectious diseases

Research has shown that lactic acid bacteria can be beneficial to human health. The probiotic L. casei strain Shirota is one example and ingestion of this strain has been shown to regulate immunity in the body, including through the maintenance and restoration of natural killer activity, which plays a vital part in innate immunity 6 (Fig. 2). Some reductions in the risk of bladder 7 , colon 8 and breast cancer 9 have been reported. L. casei strain Shirota is also known to be effective in reducing the incidence and mitigating the symptoms of various infectious diseases, such as gastroenteritis caused by acute infantile diarrhoea 10 , upper respiratory tract infection 11 and norovirus 12 .

Leveraging the power of probiotics

The results of research activities at Yakult Central Institute are applied to fields beyond product development. One example of our research accomplishments is synbiotic therapy, which is utilized in medicine. Synbiotics is a combination of probiotics and prebiotics, which functions to help increase the number of beneficial bacteria in the intestines. Synbiotic therapy is being used in medical institutions, and there are numerous reports of its usefulness in preventing postoperative infection, assisting the recovery of immune functions and improving nutritional conditions. The therapy has been particularly helpful in this respect for gastroenterological surgery, where there is a high risk of microbial infection 13 .

Figure 3: Dr Minoru Shirota (1899–1982).

Yakult DNA: Dr Minoru Shirota and Shirota-ism

In 1930, Dr Minoru Shirota (Fig. 3) of the department of microbiology at the school of medicine at Kyoto Imperial University, Japan, showed forthe first time that the reinforced culture of a lactic acid bacterium was beneficial for human health. The bacterium was named L. casei strain Shirota after taking the name of Shirota.

When Shirota began researching the therapeutic uses of Lactobacilli in preventive medicine, microbiological research in the field of medicine was in its early days. Successful identification of the Shirota strain was 23 years after the Russian scientist Ilya Mechnikov, who was jointly awarded the 1908 Nobel prize in physiology or medicine with Paul Ehrlich for their work on immunity, announced yoghurt’s eternal life agenda 14 . Because of his research and achievements, Dr Shirota could be described as a pioneer of preventive medicine.

Shirota established the ideas behind his research activity to investigate preventive medicine that would help to maintain healthy intestines and to ensure that products could be sold at a price that everyone could afford. This philosophy is continued as Shirota-ism by the research and development activities at the Yakult Central Institute. The concept of probiotics, meaning symbiosis with microorganisms, is to suppress the growth of harmful bacteria in the intestine by the action of useful microorganisms to maintain intestinal health and prevent the onset of illness.

As the state-of-the-art research institute in the field of probiotics, the Yakult Central Institute is pursuing life sciences to advance and develop its research and contribute to human health.

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Yakult: Success with “Yakult Ladies”

Yakult has built unique operating model with female salesforce called “Yakult Ladies”. Its operating model is effective from wealthy neighborhood in developed countries to slum in developing countries.

Yakult built an effective operating model with its female salesforce called “Yakult Ladies”. The operating model is well aligned with its business model and creates competitive advantage for the company.

What is Yakult?

Yakult is a leading Japanese probiotic beverage company, and is also the name of its core beverage product. Since its first production in 1935 based on the research by Dr. Minoru Shirota, the founder of the company, its operation has expanded globally. As of March 2015, Yakult operates in 33 countries and earns annual revenue of $3 billion with sales volume per day exceeding 30 million.

Pathways to Just Digital Future

Business Model

Yakult’s business model is producing healthy probiotic beverages with investment in R&D and selling them to local households all over the world. The value Yakult provides to customers is shown in the following company’s principle called “Shirota-ism”:

• Preventive medicine
• A price anyone can afford
• A healthy intestinal tract leads to a longer life.

Effective operating model with Yakult Ladies

Yakult’s success over 80 years can be attributed to the alignment of its business model and unique operating model based on its female salesforce “Yakult Ladies”. There are 80,000 Yakult Ladies all over the world, including 40,000 in Japan. The roles of Yakult Ladies in its operating model are summarized as follows:

Creating trust in Yakult among customers

Since its inception, it was among the biggest challenge for Yakult to convince customers to believe in the value of its beverages. People had negative image when they first learned about Yakult as a beverage which contains bacteria. Therefore, it was critical for Yakult to create conversation with customers so that they believed that the bacteria in Yakult had actually positive impact on their health and worth paying extra money to have that benefit.

In order to capture the value of its product, Yakult built home delivery sales channel and deployed Yakult Ladies for the channel. Yakult hired local women as Yakult Ladies who could understand local culture, communicate well with local house holds, and also keep schedules. Their communication ability was essential for Yakult’s operating model because Yakult Ladies had to explain well to customers about the healthy benefit of Yakult. Customers trusted Yakult Ladies because these sales ladies were from their regions, frequently visited customers, and were able to talk about not only their business, but also issues related to local communities.

Today, the customer base of Yakult ranges from the rich in developed countries to the poor living in the slum in developing countries. Yakult Ladies are effective, especially to the latter customer segment. These customers learn about the value of probiotic beverage not from school or media, but from Yakult Ladies. In addition, the customers in poor neighborhoods trust local Yakult Ladies because they have strong ties with people from their communities.

The trust Yakult Ladies gain from customers is important not only for selling products, but also creating barriers for entry. Even if other companies succeeded in producing similar probiotic beverages, it is hard for them to win customers’ trust over Yakult once Yakult establishes the sales channel in a region with local Yakult Ladies.

Shifting fixed cost to variable cost

Yakult Ladies are paid on commission. Also, with home delivery channel, there is less need for capital investments to market its products. Therefore, in this operating model, Yakult essentially converted some of fixed cost to variable cost. Having flexible cost structure is important especially for entering into new markets. It takes time for Yakult to hire and train its salesforce, raise awareness among customers about the healthy benefit of its product, and scale up the business. The cost structure of the sales channel with Yakult Ladies is well designed for lowering the cost of new market entry and also sustaining the business until it becomes profitable.

The operating model with Yakult Ladies might seem old fashioned in the age of digital marketing. However, Yakult Ladies continue to be essential for Yakult’s business. Yakult’s success over decades makes it a good example of how creative operating model can contribute to the sustainable competitive advantage of a company.

http://www.ft.com/intl/cms/s/0/e8e517c8-5387-11e3-9250-00144feabdc0.html#axzz3tV0qLLSq

http://www.yakult.co.jp/english/ir/management/pdf/ar2015.pdf

http://www.sugawaraonline.com/BOP/2009-11-17%20English%20Working%20Paper.pdf

http://synapse-diary.com/?p=248

https://www.youtube.com/watch?v=Okvv-dp9dKg

https://idznie.wordpress.com/2014/06/20/yakult-lady/

http://www.bloomberg.com/bw/articles/2012-09-27/for-probiotic-drinks-asia-is-the-place

Student comments on Yakult: Success with “Yakult Ladies”

Haha this is awesome. I love Yakult and Yakult ladies is ingenious!

Really interesting! I’d never heard of Yakult before – do you think the fact that they have an all female salesforce is important? Are there cultural reasons why women would be more effective in this type of operating model than men?

Thank you for your comment! I think a part of reason for the effectiveness of female salesforce would be that women on average care more about the health condition of their family, so female salesforce can more easily connect to the concern of house wives who make purchase decisions for this kind of product.

Dai, very interesting write-up. I remember yakult as a kid in Mexico and never knowing it was healthy! As you pointed out, I like how they leverage variable costs and relationships to create deep footholds in markets where their salesforce can be successful. I think I envisioned this as working better in rural areas than urban ones, but you said Japan has 40,000 yakult ladies…I assume they’re effective? Is yakult well dispersed globally or have they focused on developed countries?

Thanks for your comment! At least in Japan, Yakult Ladies are regarded as the symbol of Yakult and function as the key differentiating factor from their competitors. Yakult’s business is globally dispersed, and their business model is considered one of the early success case for marketing BOP consumers in developing countries.

Really well-constructed Daisuke!

You mentioned the Yakult Ladies approach as raising the barrier to entry for competitors, but can we maybe look at things from another perspective? If one of the main issues for lower-end consumers is education about the product, could Yakult Ladies be doing the education work for other competitors who can now use more traditional distribution channels for more cost-effective delivery methods? Do you find that the trust factor (which Yakult Ladies definitely have as an advantage) can influence purchasing decisions for this category of product?

I ask this question because my sister is adopting a slightly similar approach marketing a new skin care product in Jordan, and I am looking to help her optimize her go-to-market strategy! Will she basically end up doing all the education work for competitors, or will she build a trustworthiness advantage over the inevitable competition?

Thanks for your comment! Your point is very interesting, and it might be true that Yakult is doing the education for other competitors, too. I don’t know how it works outside of Japan, but there are plenty of similar products which look and taste like Yakult in Japan. However, people continue buying Yakult! I think the trust has significant influence for the purchase decisions because people cannot actually see how the bacteria is working in their digestion system. In the case of skin care product, this might be different. People can see the effect by themselves, and easily understand whether similar but cheaper products are as effective as the product your sister is trying to sell.

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A global campaign video aimed at raising the value of the Yakult Brand

Yakult releases “the rhythm in all of us”.

Yakult Honsha Co., Ltd. (President: Hiroshi Narita) today announced that the company would release “The Rhythm in All of Us” (a 30 second version and a 60 second version), a global campaign video conveying the passion of Yakult, on February 4, 2022.

The video illustrates the Yakult Group’s aspiration to, as stated in its long-term vision Yakult Group Global Vision 2030, “evolve into a healthcare company that continues contributing to people’s health around the world.” The video, which also conveys the passion of Yakult to people around the world, can be viewed on a dedicated page on Yakult Honsha’s website and will also be aired as a TV commercial in the countries and regions where Yakult is sold.

Yakult Science

Objective of the video

In recent times the world has seen substantial changes to the natural rhythms of health, culture, economy, lifestyle, and everything in between. Yakult aims to “evolve into a healthcare company that continues contributing to people’s health around the world,” and we would like to support these rhythms with our strength in microorganism research, which we have continued since our founding in 1935.

By conveying this passion to people around the world through the video, the Yakult Group aims to raise the value of the Yakult brand globally.

Overview of the video

Based on the concept “Life has rhythm,” the video dynamically combines images and music to express the passion of Yakult in a way which transcends language and culture.

In the video, a Yakult researcher peers at lactic acid bacteria though a microscope, and looking closer she sees the scenes of bountiful nature, the hustle and bustle of people going about their daily lives, and the continuation of life represented by a mother and her baby. The video takes these everyday wonders and synchronizes their rhythms, expressing what Yakult aspires to through its research in microorganisms.

Languages in which the video is available

Japanese, English, Mandarin, Cantonese, Thai, Indonesian, Vietnamese, Hindi, Arabic, Burmese, Portuguese, and Spanish

Video release

Dedicated webpage

The video will be released along with a making of video on a dedicated webpage. Release date : February 4 Link: https://www.yakult.co.jp/globalmovie/

TV commercial broadcast

Broadcast as a TV commercial is scheduled to begin as follows. Japan: February 5 Outside Japan: It is scheduled to roll out from February 5 onwards. (The schedule will differ depending on the country and region.)

Creating a more sustainable future.

Empowering wellness for people and planet..

*Classified as Lacticaseibacillus paracasei strain Shirota since April 2020

“THE GOAL OF THE YAKULT GROUP HAS, AND WILL ALWAYS BE, TO MAKE THE PLANET AND THE PEOPLE LIVING ON IT, HEALTHY AND HAPPY.”

At Yakult, we believe that in order for people to be healthy, everything around them must also be healthy. That’s because our health and that of the Earth are interwoven. And in the last few years, as climate change has progressed and human rights issues have come to the forefront, it’s more important than ever for us as a company to take measures toward becoming more sustainable.

But becoming sustainable is more than a trend for us. It’s a commitment. A commitment to improving every aspect of our business, so that it truly impacts the planet’s health, and yours. That’s why we have identified six of the most important environmental and social issues to focus on as we journey toward a more sustainable future: climate change, plastic containers and packaging, and water from an environmental standpoint, and innovation, value co-creation with communities, and supply chain management from a social issues perspective.

All of the measures we are implementing now will guide us to achieving our Yakult Group Global Vision of evolving into a healthcare company by the year 2030, and continuing to contribute to the health of people around the world.

We have set three goals to help us achieve this vision: “delivering good health to as many people as possible around the world,” “offering customers new value that matches their needs” and “realizing a society in which people and the planet co-exist.”

From our first day in business in 1935 until this very day, we’ve been committed to the contribution for the health of people. And that commitment has never floundered. But as the world has changed, so have our methods for it. We’re using innovative, state of the art approaches to maker our planet and our business practices sustainable. Because the goal of the Yakult Group has, and will always be, to make the planet and the people living on it, healthy and happy.

• Supply chain management
• Sustainability

Supply chain management Materiality

Our approach.

In all of our business activities we must fulfill our social responsibilities as a corporate citizen by complying with laws, respecting human rights, considering the global environment and managing information securely.

To support the stable production and sale of products beneficial for health and activities toward a sustainable society, we have also made sustainable procurement a key theme within our CSR activities.

As sustainable procurement requires collective action with our business partners, we will communicate proactively and work together with partners, mitigating risks and considering social and environmental impact throughout the supply chain and improving the sustainability of society.

Keeping an eye on global trends and responding to change

At the 26th UN Climate Change Conference of the Parties (COP26) held in Glasgow, UK, in November 2021, the Glasgow Climate Pact and the Glasgow Leaders’ Declaration on Forests and Land Use were formulated, which called on companies to take action to reduce greenhouse gas emissions in their supply chains and conserve forests in order to combat climate change and protect biodiversity.

Meanwhile, problems related to procurement have been increasing due to the rising price of raw materials resulting from international turbulence and a sharp decline in the yen’s value. The realization of the social impact that supply chains have, as well as the attention they garner, and the expectations for them have never been greater.

We at the Yakult Group will re-examine our supply chain management and strive to make our supply chain and the Yakult business more resilient by fundamentally enhancing environmental and social sustainability.

Enhancing sustainability across the supply chain

As one example of the efforts made to realize the Yakult Group Environmental Vision, which details plans for a value chain with zero environmental impact, we converted all the energy purchased for our domestic dairy and pharmaceutical production sites to renewable energy in April 2022. Our cosmetics plant also switched to renewable energy in July of the same year, completing the switchover at all domestic plants. This will lead to an annual reduction of around 34,800 tons of greenhouse gas emissions.

We will continue to consider and implement actions to reduce our environmental impact, but we cannot achieve our Group’s goal of net zero GHG emissions without collaborating with our suppliers. In addition, human rights issues such as forced labor, child labor, discrimination and inhumane treatment in the supply chain are also important themes to be resolved. In order to address these issues, we believe it is very important use the CSR procurement survey and Supplier CSR Guidelines in communication with suppliers.

In October 2021, we held a briefing on our CSR Procurement Policy for our suppliers, with around 400 participants from 158 companies. This was a very meaningful opportunity to explain once again our CSR Procurement Policy and guidelines, share awareness of issues with our suppliers, and confirm our efforts to solve them.

Further promoting supply chain management

We will continue to improve the level of our own initiatives for CSR procurement, while implementing various approaches to enhance sustainability together with our suppliers. Specifically, we will consider and implement specific actions that include developing CSR procurement surveys for suppliers in Japan and overseas, utilizing international platforms, and establishing targets for raw material procurement. On the basis of these efforts, we will respond to the demands of society to build a sustainable supply chain, as a corporate group with global operations.

Akifumi Doi Director and Senior Managing Executive Officer Divisional General Manager of Production Division

Related SDGs

Working with our suppliers to promote sustainable procurement.

The Yakult Group works with suppliers to promote sustainable procurement throughout the supply chain based on the Yakult Group CSR Procurement Policy, established in 2018, and the Yakult Group Supplier CSR Guidelines, established in 2020.

In fiscal 2021, approximately 400 people from 158 suppliers participated in our first CSR Procurement Policy briefing, held to provide them with information on sustainable procurement and promote their understanding of our CSR procurement policies and future plans. The event resulted in a shared recognition of various issues among our suppliers.

Yakult Group Supplier CSR Guidelines

Based on the CSR Procurement Policy, the Yakult Group Supplier CSR Guidelines were formulated in July 2020 in order to effectively promote sustainable procurement within the Group and help create a sustainable society. The guidelines are a collection of requirements regarding responsible procurement activities for all our business partners in Japan and overseas, including new business partners.

For each requirement in the guidelines, we check the status of our efforts through surveys and audits, and if any problems are found, we take appropriate measures for improvement.

Together with using these guidelines, the entire Yakult Group will continue striving to promote sustainable procurement.

Translations of the Yakult Group CSR Procurement Policy

• Chinese (Traditional Characters)
• Chinese (Simplified Characters)

Deforestation and Conversion Free (DCF) Commitment to Responsible Sourcing

The planet's environment is at risk due to global warming, environmental pollution, loss of biodiversity and depletion of natural resources. Based on the Commitment, we will pursue our business activities while considering the planet's environment and the lives and human rights of the people supported by the environment, and to create a society where people and the planet can coexist forever.

We have identified raw materials at risk of deforestation in our supply chain and are committed to promoting sustainable procurement of these materials, setting out our basic policy, initiatives and targets.

• Click here for the full text of the Commitment (PDF).

The explainer video related to Yakult's Deforestation Free Commitment

Initiatives and Targets/KPIs

We identify pulp and paper, palm oil, soy and dairy products (e.g. skim milk powder) as raw materials with a high-risk of deforestation, set Targets and KPIs for their sustainable procurement, and promote responsible procurement in our supply chain.

*The quantitative Targets and KPIs will be reviewed and updated as appropriate to improve ongoing efforts in the Commitment.

Progress report on the DCF Commitment

The Yakult Group is taking initiatives to verify Deforestation and Conversion Free in its supply chain.

• Click here for the progress report (PDF).

Main initiatives

Raising sustainable procurement awareness.

We are also conducting sustainable procurement promotion meetings and sustainable procurement workshops for our employees involved in raw material procurement and manufacturing consignment.

In fiscal 2021, training on sustainable procurement was provided to a total of 72 persons responsible for or involved with CSR procurement promotion at the Yakult Group’s overseas offices, as well as officers and employees of the department in charge of overseas offices at Yakult Honsha.

Supporting communities with local employment and sourcing

To contribute to the sustainable development of the countries and regions where we operate, we conduct our global business with a local focus based on local production and sales using raw materials that can be stably procured and satisfy our product quality and safety standards.

Yakult currently operates in 40 countries and regions including Japan, with 29 overseas companies. We have established sales offices and production plants with deep ties to local communities, and actively hire local employees.

Includes imported raw materials that receive final processing in Japan

For details, see “Supply chain management” of the Sustainability Report

Sustainability Report: Supply chain management