Back in 1978, on 25 November, pioneering Japanese group, Yellow Magic Orchestra released their influential, eponymous, debut full-length. The album and group are widely credited with being very influential on the development of several music genres, including ambient, chiptune, electro, hip hop, house, J-pop, synthpop, and techno, to name a few.
The band (also known as YMO) were also on influence on another Japanese scene that emerged around the dawn of the 21st Century, picopop (or ピコポップ). Bands and performers such as EeL, Hi-Posi, Motocompo, Plus-tech Squeeze Box, Sonic Coaster Pop, and Strawberry Machine updated the shibuya-kei (渋谷系) style popularized in the 1990s by Cibo Matto, Cornelius, Flipper's Guitar, Pizzicato Five, and Original Love by adding some good, old fashioned, electro elements with a sensibility that often recalls YMO.
Capsule in shibuya-kei mode --> Capsule in picopop mode
Shibuya-kei had initially drawn largely on bossa nova, jazz, lounge, and yé-yé. In the late 1990s and early 2000s it began to evolve into "picopop" for for the "piko" sounds of classic game sound effects and scores. Some acts, like Capsule (カプセル), began their careers making shibuya-kei before thoroughly transitioning into picopop. Others, like Yukari Fresh Colorful System, combine elements of both closely associated scenes.
Usagi Chang (Little Bunny) Records is the label most associated with pico pop although Motocompo's Shibuya-based label, Poplot and Columbia Nippon's J-Pop branch, Heat Wave, also released popular picopop albums. In the past few years, abcdefg* have released (and re-released) picopop recordings.
The amount of electro elements vary from performer to performer and often song to song. Perhaps the sometimes ridiculously twee, kawaii, visual aspect is almost as important as the music. Judge for yourself by sampling the following picopop videos and happy birthday Yellow Magic Orchestra!
Plus-Tech Squeeze Box
Macdonald Duck Eclair
Hazel Nuts Chocolate
naivepop or petitfool
Laugh & Peace
Other artists to check out for those so inclined include: Coltemonikha, Misswonda, EeL, Sonic Coast Pop, Nagisa Cosmetic, and Copter4016882. Ja!
Update: In 2013 American singer from San Gabriel, Joanna Wang, released an album (Galaxy Crisis: The Strangest Midnight Broadcast) that marks a stylistic shift into Picopop -- probably one of the first Americans to work in the genre.