What Is “Neo Izakaya,” Popular in Tokyo as an Instagrammable Spot?

Izakaya is a pub where anyone can casually enjoy beer or sake with snacks within the budget of 3,000 to 4,000 JPY (approx. 22 to 30 USD). Outside Japan, many izakaya used to be designed for local Japanese communities, but recently high-end and stylish places, such as ZUMA, saw a unique development overseas by adjusting the basic concept of izakaya to local non-Japanese people and began to gain popularity.

Meanwhile in Japan, a new style of izakaya called “Neo Izakaya” (also known as modern izakaya) has come to attract the attention of young generations in the last few years.

1. Izakaya Business Struggling amid the COVID-19 Pandemic

Traditionally, izakaya evolved as a social gathering place where business people dropped by after work with colleagues and enjoyed drinks together. However, the COVID-19 pandemic starting in 2020 made many Japanese people avoid having a large gathering. Due to the change in people’s lifestyle, large-scale izakaya with a number of seats closed one after another. It is said that the izakaya market shrank by about 40% in 2022, compared to the pre-pandemic days.

2. Changes in Japanese Izakaya Before COVID

There is no doubt that the pandemic seriously damaged the izakaya industry, but the market itself had seen its peak in the 1990s and had been already gradually shrinking in the last two decades, partly because young people are drinking less.

Under the circumstances, those who are involved in the izakaya business had been looking for ways to survive with a new business model even before the pandemic.

One of the famous business models that became popular in the 2000s is standing bars, called tachinomiya. With no tables, it can be opened in a narrower space and cut down fixed costs, such as rent and utility bills. Table turnover rate increases in this style of bar as well. The lower customer spend than usual izakaya (1,000 to 3,000 JPY, approx. 7 to 22 USD) appealed well to customers and standing bars caused a sensation. “Senbero” became a popular word: it is a shortened phrase meaning you only spend 1,000 JPY (“sen-yen”) to get drunk (“berobero”). Downtown Tokyo, such as Tateishi and Akabane, have a lot of casual standing bars frequented by local customers.

Similarly, table-sharing izakaya appeared after 2010. In the past, it did happen that customers got acquainted with others sitting near you at izakaya. Yet, this new business invites those who are looking for a romantic partner to share the table so that they drink together on their first “date” (free of charge for women, men are charged hourly). This new setting was welcomed by youth and became very popular.

3. Neo Izakaya Gaining Attention after the COVID

Now, the last few years have seen the rise of Neo Izakaya, a new model emerging in metropolitan areas, like Tokyo. Completely detached from the conventional images, such as red paper lanterns, draft beer, yakitori, and businesspeople with a tie, these new stores feature instagrammable glasses for drinks or stylish interior designs and give off a welcoming atmosphere for women and young people.

The interior designs and drinks were developed to appeal to the Instagram users, and when customers post them on social media, new customers visit the store. In this way, this model of izakaya is rapidly increasing, such as Neo Tokyo in Sangenjaya, Meiko Shibuya in Shibuya, and Pronto Kissakaba across several bustling areas in Tokyo.

These places focus on original cocktails that look appealing on Instagram. The menu includes cream soda cocktail, milk highball, and chili tomato highball, items that would potentially go viral on social media. Food menu ranges from typical dishes, such as fried chicken, niku dofu (tofu with beef), and menchi katsu (deep-fried ground meat), to original dishes influenced by Italian, French, and Chinese cuisines.

The average customer spend is 4,000 to 6,000 JPY (approx. 30 to 44 USD) in many Neo Izakaya and a little higher than traditional izakaya (3,000 to 4,000 JPY, approx. 22 to 30 USD). Nevertheless, they are supported by youth who are alert to trends in uptown areas like Shibuya, Ebisu, and Sangenjaya. This business seems to have room to grow much more.

Neo izakaya does not seem to exist outside Japan yet, but the strategies to create drink and food menus as well as the marketing tips on social media can be insightful for many Japanese restaurants abroad.

If you are considering opening a new style of izakaya, contact Washoku Agent, as we are also well versed with the latest food trend in Japan!

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If you have a problem in recruiting Japanese chefs, feel free to contact us Washoku Agent!