The ears look like clip-on decorations—they were supposedly made with what's called "sukige" (すき毛), which is fake hair that's sometimes used for more volume. These were then colored yellow and black. The look is completed with face paint and a yellow suit.
In the image below, via Twitpic, you can see the model before he morphed into Pikachu.
Japanese fashion magazines, while interesting, sometimes cook up fashion ideas which never catch on and are truly baffling. As the number of readers for print mags declines, these stunts are sometimes used to stoke interest—or wtf.
For example, here are some outrageous female hairstyles from Japanese magazines that thankfully never caught on.