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Cultivating Culture and Wellness: Tree of Life's journey in aromatherapy and lifestyle evolution

Interview - January 28, 2024

In a compelling discussion with Tadashi Shigenaga, President of Tree of Life Co., Ltd., the interview unveils the company's generational evolution from a post-WWII photo studio to pioneering Western-style plates and, ultimately, delving into aromatherapy oils and herbs. Emphasizing culture over mere functionality, Shigenaga outlines the firm's strategy, navigating Japan's aging population by targeting diverse markets and embracing organic trends. Tree of Life's ethos of "mottainai," cherishing resources, permeates its practices, from naturally dyed uniforms to AI-driven personalized scents. Shigenaga envisions his legacy as a leader fostering growth, urging the next generation to innovate beyond past successes, and ensuring Tree of Life's ongoing impact on global wellness.

TADASHI SHIGENAGA, PRESIDENT OF TREE OF LIFE CO., LTD.
TADASHI SHIGENAGA | PRESIDENT OF TREE OF LIFE CO., LTD.

If we could start with a brief introduction to Tree of Life. What is your company’s core competency and what do you believe to be the key advantages that set you apart from your competition? Additionally, could you walk us through some of the key milestones throughout your company’s history that have shaped Tree of Life to be the company it is today?

To explain our company’s philosophy it is important to trace back our company’s history. My grandfather is the company's founder and I’m the third generation president. It was just after WWII that he opened a photo studio in Harajuku, and nearby there was an American residential area called Washington Heights, and he visited the houses to take photos of the American families living there. My father also helped out as a school child, but my father decided not to become a photographer, instead starting his own business. Learning about Western lifestyles through photoshoots he felt that Western cuisine has the potential to penetrate the Japanese market. My father, as a pioneer, wanted to create Western-style plates with the idea that once the cuisine gets popular there will be plates for it in Japan. His business encompasses design to mass production and this is how my father evolved the company.

This leads to my generation's business of aromatherapy oils and herbs. These three businesses seem very diverse but there is a core commonality which is that we do development, production, and sales solely by ourselves. As a Western porcelain designer and manufacturer, my father often had opportunities to visit the US. I also went with my father and encountered potpourri; a mixture of dried petals and spices placed in a bowl or small sack to perfume clothing or a room made by hippies. With the hippie culture, it is about the natural ingredients being taken into the body for health purposes. We were able to encounter and learn about potpourri in the US for the first time.

We learned that hippies often host music festivals and concerts that call for anti-war, peace, and love, with the use of herbs in aromatherapy. Hippie culture honored and worshiped natural beauty and natural essences, and by utilizing these natural elements they could become more healthy. I encountered hippie culture right before I turned 20 years old. I think I became interested in herbs at an early age because when I was 12 years old I was hospitalized for a heavy kidney disease, staying in hospital for three years. I wasn’t able to do any sports and a Western doctor told me that my disease was incurable. However, my mother discovered Chinese medicine, and by taking herbal medicine I was able to recuperate fully within two years. At 20 years old I had the experience of receiving natural remedy care, and when I came across potpourri I realized it would be a very important product for the well-being of humans. 

After my first encounter with potpourri, I contemplated how to introduce this concept to Japanese people. First, we started with lessons on how to make potpourri, with these lessons targeting children rather than adults, especially elementary-aged girls. We taught them how to make this fragrance potpourri and this became our first successful experience. This I think comes down to the fact that rather than develop a product first, instead we tried to introduce the culture to these elementary school girls so that they could make their fragrances by combining different types of dried herbs. We held a potpourri competition in Japan and that became very popular. In particular, there were many interesting ideas for presentation and that has created a boom for potpourri among elementary school girls.

Finding applications for potpourri was the first step, and then the next step was herbal tea. The initial purpose of this was to consume herbs as a tea to intake the herbs, but after drinking tea there is always a residue of tea leaves left over. We’ve had this concept of mottainai which describes how unfortunate it is for something to go to waste. We did not want to throw away this resource so what we did was take these leaves and cover them with a cloth. This is then placed in a bath as a new application creating an herbal bath. This bath herb method became very popular, but we did start getting complaints from owners of white bathtubs that were left with stains on their tubs because of the herbs. We dealt with the complaints but it gave us the idea of herb dyeing we felt that we could use this to stain fabrics or other materials using herbs as the natural ingredient for color dyeing.

The next step was to not only push dry herbs as our core ingredients but to develop 100% all-natural essential oils. That idea led to our current lineup of aromatherapy oils. We evolved by first finding an application and then doing product development. We’ve followed this process to reach the point we are today where we have over 2,600 different types of items on offer.

Around the mid-1990s, we were recognized as a company in Japan that was key in creating culture. We’ve taken the lead in developing and promoting herbal life in Japan. To showcase all of the experiences we’ve accumulated we established a facility in Saitama in 1996. The facility is 12,000 square meters in size with all sorts of things such as a herb garden, a shop, an educational school, a restaurant, and a bakery. There are many experiences there that you can enjoy through our products.

In 1995 we had a good experience with Sri Lanka and the way of life there. In fact, in 1995 we opened the Tree of Life Hotel in Kandy, Sri Lanka. The strength of our company is creating culture, and I feel we lead in the innovation of new culture. With the creation of new products and applications, we also create locations where people can gather and experience our products. I think that thanks to our customers we’ve been able to establish a training school system where our customers can learn in detail about the culture and herbal way of life. They then send that message out to other people, who then become customers. It is a cycle of cultural creation. Not only has this increased our customers but also it has increased the number of people wanting to work for us.

Thanks to our passionate staff who have extensive knowledge of herbs they have been able to pass our knowledge on to customers, who then pass that knowledge on to their friends, thus enlarging the aromatherapy and herbal population in Japan. Our company creed is to “become one,” meaning we currently want to only pursue one idea to its fullest. We can keep that position but that is thanks to our innovation in the space. I have high expectations for the next generation of Tree of Life to continue innovating.

 

Japanese lifestyle and cosmetic industries suffered in recent decades due to ultra low cost of regional production in countries like China. Despite this, Japanese cosmetic manufacturers remain leaders in highly functional and specialized products such as fragrances or cosmetic additives. What are the strengths and weaknesses of Japanese lifestyle and cosmetic industries today?

There are two contrasting concepts in play here, one is culture, and the other is civilization. The lifestyle industry is affected by both culture and civilization. The stark difference between the concepts is that civilization's purpose is to make people’s lives more comfortable, and more efficient, and reduce costs. Culture on the other hand provides happiness to people’s lives. Japanese people innately have strength in cultural creation. Seeing the current trend of inbound visitors, they are not here to experience the civilization of Japan but rather to experience the cultures of Japan and the deep mindset behind Japanese cultures. Japanese people must realize the importance of treasuring and enriching the culture that we have accumulated from the past.

Global society is changing now. Before it was the pursuit of more convenient lives, but now it is more about the pursuit of happiness and environmental sustainability. Not only is functionality important, but also branding, quality, and mindset.

 

Japan is known to have a very aging population. It is predicted that by 2050 the population will drop below 100 million people, and this raises two main issues. The first is a shortage of labor and the second is the shrinking domestic market. As a lifestyle company, which other countries or regions do you feel you need to bring your products and philosophy to ensure long-term business success?

This aging population was inevitable but what I think is a key difference in Japan in particular is the fact that senior people here are proactive in society and take part in labor work. It comes down to society and companies providing the right occupations and opportunities for them to play a role. If senior people can act in a supporting role for the next generation then I think it will make a good balance for Japanese society in general. Overall the population may decline but the working generation in theory may not. 

In terms of the market size, I don’t think it is necessarily shrinking from our perspective. We are currently enlarging our sales channels through e-commerce, with a particular focus on targeting Generation-Z who are in their 20s. There are also more active seniors in their 60s and 70s, and we can exploit their interests in our products. Overall by opening up our sales channels, we can cater to a wide range of generations.

In 2020 we reviewed our company purpose, and since we’ve set our purpose to be about wellness and wellbeing, this is taking into account the wide range of customers we have.



Diversification to a more balanced lifestyle using more natural-based products rather than chemical ones is growing and becoming a larger trend. As each day goes by the market is expected to grow; 10% annually on a worldwide basis, attaining a market valuation of USD 10 billion by 2027. Even in Japan, it is expected to represent a 5% share and around USD 400 million by that time. How do you envision yourself and your firm taking advantage of this growth both domestically as well as internationally?

We are aware of this market growth and as the market gets bigger more companies enter the market. We have over 40 years of accumulated experience in this industry and we want to take this opportunity to help out those newcomers that enter the market with our B2B business. On top of B2C, we have currently strengthened our B2B business so that we can help and support companies that want to start up organic or natural ingredient-related businesses.

There are many ways to support companies, for example, by providing our own branded products or ingredients, and to that end we have direct contact with a farm. This enables us to swiftly provide raw materials to companies so that they may create natural products. We also offer OEM solutions so that companies can brand our products with their name and sell them. Tree of Life offers recipes for aroma and herbal tea blends in addition to our education and training schemes. Our firm even has consultation services for companies that are looking to strengthen themselves and leverage our 40 years of experience. By combining our strengths we are sure that we can help create so many new opportunities for companies in the space, while at the same time growing our network of like-minded companies globally.

Enlarging the aromatherapy and lifestyle market together with other companies is also furthering our goal of contributing back to countries where we procured materials, for example, the US. Across the globe, we have a network of material procurement, and by producing value-added products that are then shipped back, local markets are then able to promote incentives while also creating a new market for providing companies like ourselves with these raw materials. Contributing twice as much as what they are contributing to us is our target right now.

We have a huge amount of gratitude towards countries like the US and France that have provided us with fragrances such as lavender for example, and those fragrances have allowed us to produce products that have been highly evaluated by users. By creating products that are highly valued and then sending them back we are showing our gratitude to these raw material providers.

 

Throughout many of our interviews, the idea of collaboration is often stressed as a way of staying competitive globally and understanding overseas markets better. You’ve built a wide and impressive network with farms all around the globe and co-created products with many companies. How important is collaboration in your business model and are you currently searching for new collaboration opportunities with overseas companies?

Partnerships and collaboration play a vital role in our business model and what we want to stress is the idea of having a common purpose, which within our company philosophy is the promotion of wellness and wellbeing. If we could share the same values and have a business partnership in the form of a joint development or OEM contract that would be the ideal partner for us.

 

You are not only focused on the domestic market, and today we’ve already mentioned your hotel in Sri Lanka. Where would you like to continue your international expansion and what kind of strategies would you employ to do so?

Suppose I were to name a specific country that would be Taiwan. About ten years ago we had a retail store in Taiwan, and we ran it for about eight years, but we were too early for that market. Now that the market has matured and there is more international travel from Japan to Taiwan the cultures are becoming quite similar. We want to challenge the Taiwanese market once again.

The US would also be an attractive market, but the approach would not only require a retail location but also an e-commerce approach, so in that case we would need to increase our sales channels to be effective in the region.

 

Can you explain in a little more detail how you’ve been able to integrate this concept of mottainai into everyday products?

This concept traces back to the simple act of showing gratitude to nature. We are fortunate as humans to be blessed with so much of nature’s bounty so we must not waste it. This is the core principle of mottainai.

One of our mottainai activities is to make the best use of the resources we have. We have about 100 retail stores and 400 staff members, and when you see the uniform they wear it is naturally dyed from herbs that couldn’t be used in our teas. Those herbs that couldn’t be used don’t go to waste, and instead, we found an alternative use for them.

Another important aspect of mottainai is to produce only the amount that can be sold completely so that you can always keep it in stock in fresh batches. Oftentimes our products require freshness, so creating the right amount for market demands is important. This concept is the future of mainstream economy based on the idea of creating products at minimum quantity while also creating circulation not only in the economy but in people’s households as well.

 

Scent is a very powerful tool to engrave memories into the minds of people, and in fact, some stores use scent as a branding aspect of their marketing, for example, Abercrombie & Fitch uses a very precise type of fragrance to advertise themselves. What type of effects or emotions are you trying to transmit with the scent of your products? Can you guide us through your thinking process when you develop new types of oils?

First of all, we are using nature’s blessings as ingredients so it is important to fully utilize the combination of natural ingredients to promote the raising and growing of these ingredients to the best degree. It means that the efforts of the farmers who cultivate these natural ingredients are being featured in the quality of our fragrance.

We have in-house fragrance specialists, and daily they blend and combine essential oils to create new and interesting fragrances. This is all made from essential oils that we extract from the natural environment. The functionality of the aroma can be proven, but what is more important in my opinion is the emotional aspect which is hard to measure. The emotional impact of an aroma is measured by the sensitivity of the people experiencing the aroma, which can only be acquired through experience. The in-house fragrance specialists are now able to create based on their sense because of their wealth of experience in the field. That is the type of aroma we provide to our customers.

On the other hand, we are promoting custom-made aromas that are made by the customers themselves. Last year we introduced our My Aroma project which uses AI and other digital tools to create one-of-a-kind smells. The idea is to create a unique smell for each of the 120 million people living in Japan. Creating identity with aroma is something that hasn’t been seen anywhere else in the world.

What is interesting about the aroma business is that it is similar to wine in the fact that the natural materials are grown and the climate and location can affect properties such as the scent every year. These slight differences are something that we provide our customers as part of our unique services.

 

You have a wide variety of aroma-related items including about 200 kinds of essential oils, all promoting the benefits of natural elements. Organic products as a market is growing 11% annually at the moment worldwide and is a key factor in my clients achieving a more balanced lifestyle. What is your opinion of organic types of products?

I can foresee the growth of the organic market, however, having said that it is very important to provide options to both people who want organic and those not interested in organic.

As an example, some people smoke and people don’t, but these people co-exist, so likewise we would like to do the same for people who like organic things and people who aren’t fussed by organic things. Our company’s mission is to promote the goodness of organic things and how organic processes are environmentally friendly. In that sense, promoting and increasing our lineup of organic products is important to our company.

 

Imagine if we came back on the very last day of your presidency and had this interview all over again. What goals or dreams would you like to achieve during your presidency by the time we come back and you are ready to hand the baton onto the next generation of Tree of Life executives?

I would like to be remembered as the kind of president who helped people grow. Growing the people and maintaining as well as passing on a sustainable business is very important business-wise as well as my mission. I want people to remember me as someone who grew the human capacity of our employees.

When I pass the company onto the next generation I would remind them not to be confined by what was done in the past. The success of the past can be restrictive, so it is more important to create new ways, new approaches, and new innovative business ideas.

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