Japan Market Update - May 2003 Edition

Aloha ,

Hawaii began the year with an increased number of travelers from Japan and a positive first quarter. This spring the travel industry was blown a double punch by the war and the SARS virus. The relatively quick end to the war gave many in the industry optimistic expectations for a quick recovery, but the SARS situation has been extremely problematic--even for travel from Japan, where no cases have been recorded. Now with over 5,000 reported cases of SARS in Asia and Canada, many Japanese are hesitant to go to the airport for fear of catching the disease.

With information on how SARS is spread and how to control it still a mystery, Japanese continue to be cautious. Most are waiting for more information and a decrease or burn-out of SARS cases to travel overseas, even domestically.

Travel during Golden Week (April 29 to May 5) was also impacted by war and SARS, and one more key factor-- a poor line-up of holidays this year. Last year's Golden Week travel numbers were fairly positive due to the schedule that combined holidays and weekends and made it easier for Japanese to take time off of work and expand their vacations. This year the line-up did not offer that situation, and many Japanese opted to postpone trips.

On a positive note, Hawaii faired better than China, where travel from Japan plunged nearly 80%. Hawaii, Guam, Oceania, and the Continental U.S. did better than most travel destinations during the war. In fact, Hawaii is now beating most other destinations for travel and is one of the leading destinations for Japan-based tour operator campaign programs.

Hawaii's rebound opportunity is due to the effort and momentum the visitor industry is putting behind the destination to stimulate short and long term demand. The Hawaii Visitors & Conventions Bureau launched a major recovery campaign on May 6 and in a show of confidence, JAL will resume most flight schedules to Hawaii this summer.

While we at PacRim Marketing predict travel numbers to remain soft for May and June, we are optimistic that travel from Japan to Hawaii will show signs of rebounding later in the summer and over the long run. We expect to see greater support from the Japan market post SARS. Hawaii may stand to gain market share of outbound Japanese visitors who lose interest in traveling to SARS affected countries.

I hope this information helps you with your market planning. Please call if you have any questions or if we can assist you with your marketing and media strategy recovery programs and efforts.

Best Regards,

*Japan Market News
-----JTB to promote beach resorts for summer campaign
-----Lingle's Japan mission still on for July
-----Wedding market continues to remain strong
-----Senior travelers led the way in 2002
-----JAL Group to hike domestic airfares
-----Center to attract Japanese students to Hawaii
-----Gucci Group acquires property in Ginza
-----Supermarket sales continue to slide
-----Home improvement sales continue to slide
-----Drugstore's diversity is a welcome addition to shopping complexes
-----Separation of sexes proving a hit
-----Women continue to wait for marriage
*Culture Corner
*Media of the Month
*Upcoming Magazine Deadlines
*Important Dates

JTB TO PROMOTE BEACH RESORTS FOR SUMMER CAMPAIGN

JTB will be launching a sales promotion to help revive demand in travel. It plans to activate the market for a busy summer season due to the quick war with Iraq and the high potentiality of the travel market. Hiromi Tagawa, managing director of JTB, stated that his company is attempting to attain revenue of 30 million yen higher than the initial target set in the 1st quarter of this year. In order to meet this goal in overseas travel, JTB will be heavily promoting beach resorts such as Hawaii and Micronesia in their sales activities. (The Travel Vision 5/6/03) Back to top

LINGLE'S JAPAN MISSION STILL ON FOR JULY

A tourism mission to Japan, lead by Hawaii's Governor Linda Lingle, will go on as planned in July. In a show of support of the mission, the Hawaii Tourism Authority plans to launch a $2 million nationwide promotional blitz. This campaign will begin on May 6 and would include targeting the senior market in Japan. To coincide with the mission, HTA will start newspaper advertisements , from July to September, focusing on the summer travel season. (Travel Journal International 4/28/03) Back to top

WEDDING MARKET CONTINUES TO REMAIN STRONG

For the first time the State of Hawaii is compiling data to determine the strength of the Hawaii wedding market. Through the first 3 months of the year, 51,288 of Hawaii's 1.6 million visitors came to Hawaii to get married. Foreign visitors, mostly from Japan, accounted for 39,943, while the US Mainland totaled 11,345 visitors. More than 75% of all the weddings in Hawaii are Japanese visitors. Tourism officials also mentioned that couples who get married in Hawaii tend to be affluent, spend their honeymoon in Hawaii, and return later for vacations or anniversaries. (Honolulu Star-Bulletin 5/6/03) Back to top

SENIOR TRAVELERS LED THE WAY IN 2002

Senior travelers proved to be the saving grace for the outbound market in 2002 as they posted the highest increase among all sectors according to the latest statistics released by the Ministry of Justice in early April. The MOJ said that the senior market (ages 60~69 and 70~above combined) sent 2,532,650 overseas travelers last year, an increase of 7.35%, underscoring the growing importance of this market as many have a higher level of disposal incomes and more free time than their younger counterparts. Overseas travelers in their 60's increased 6.89% to 1,915,978 while those 70 and above recorded an 8.85% jump to 616,672. More encouraging than the numbers is the fact that the share of seniors continues to edge upward, to 15.32% from 14.54% a year earlier. (Travel Journal International 4/28/03) Back to top

JAL GROUP TO HIKE DOMESTIC AIR FARES BY 11% IN JULY

Japan Airlines has received approval from antimonopoly authorities to increase regular domestic air fares by about 11% in July. As for international air fares, JAL Group implemented a 3% hike on April 15 in line with a decision made by the International Air Transport Association in March for its member airlines around the world. (Yahoo! News Asia 4/25/03) Back to top

CENTER TO ATTRACT JAPANESE STUDENTS TO HAWAII

A new partnership between Hawaii universities and an exchange center in Osaka is expected to bring in thousands of Japanese students to Hawaii. A.N. Group, which operates cultural learning centers in Japan, opened the Hawaii Exchange Center in Osaka with a goal of recruiting 1,000 students to attend various college campuses in Hawaii. Before the center was established, many potential students needed to apply to these colleges by themselves. Now students contact the center and they can do everything in Japan. The company also plans to open a cultural learning center in the Azeka Place Shopping Center in Kihei, Maui on June 1, and offer Hawaiian and Japanese cultural classes and Japanese language for children and adults. (Pacific Business News 4/28/03) Back to top

GUCCI GROUP ACQUIRES PROPERTY IN GINZA, TOKYO FOR JAPAN FLAGSHIP STORE

Gucci will be opening a flagship store in the Spring of 2005 that will be large enough to also house Gucci's Japanese headquarters. Currently Gucci has seven freestanding stores and 37 shops inside other retail outlets in Japan. About one-fifth of Gucci Group's annual sales are from Japan. (Pacific Business News 4/7/03) Back to top

SUPERMARKET SALES CONTINUE TO SLIDE

According to the Japan Chain Store Association, sales at supermarkets declined in 2002 by 2.1% compared to 2001 figures. This marks the sixth consecutive year of a decline in sales. However, their food sales have remained stable as it increased by 0.7%. (Japan Economic Newspaper 1/23/03) Back to top

HOME IMPROVEMENT CENTERS CONTINUE TO EXPAND IN RETAIL SLUMP

Despite the sluggish economy, home improvement centers continue to expand across Japan. By using timely responses to the changing consumer lifestyle, they have been able to maintain an increase in sales while department stores have consistently seen their sales drop. The Ministry of Economy, Trade and Industry said that sales of home improvement stores has increased by 27.9% from 1999 figures, while department stores have fell 17.4% in the same time period. (Nikkei Weekly 3/31/03) Back to top

DRUGSTORE'S DIVERSITY IS A WELCOME ADDITION TO SHOPPING COMPLEXES

Another growing segment is drugstores that have expanded their services and goods into cosmetics, hair care products and health goods. Due to their outstanding pulling power, drugstores are often invited to become core tenant of shopping complexes. (Nikkei Weekly 3/31/03) Back to top

SEPARATION OF SEXES PROVING A HIT

Over the last few years, businesses in the service sector such as hotels, railway operators, and video game arcades have been offering new services designed exclusively for women which are off-limits to men. Some hotels have chosen to offer "Ladies packages", while Keio Electric Railway Co. has been running women only train cars every weeknight on nine trains leaving Tokyo's Shinjuku station after 11:00 pm. Many companies have been eager to engage in this new service while shutting out men because of the enormous spending power of Japanese women. Also, women tend to have more refined sensibilities. Therefore, services approved by women are generally regarded as high quality. (Nikkei Weekly 4/14/03) Back to top

WOMEN CONTINUE TO WAIT FOR MARRIAGE

The growing number of working single women in their late 20's and 30's continues to grow as more women choose to remain single. Women between the ages of 25 and 29 who are unmarried has more than doubled over the last two decades, reaching 54% in 2000. Also, the percentage of single women aged 30-34 has risen to 26% from 9% during the same period. (Nikkei Weekly 4/14/03) Back to top

KODOMO-NO-HI (CHILDREN'S DAY)

Originally known as Boy's Day, it is now a celebration of all children. Much like Girl's Day (Hinamatsuri), dolls for boys are put on display in homes. The dolls are patterned after warriors and heroes. Carp are another symbol of Children's Day. They represent strength (known to swim up waterfalls), and success in life. An ancient practice of bathing with flag plant leaves is also observed on this day; it is said to have medicinal values. It is also important on this day to make offerings of Japanese confections: rice dumplings wrapped in bamboo leaves and rice cakes wrapped in oak leaves.

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ALOHA AIRLINES JAPANESE IN-FLIGHT MAGAZINE

With nearly 1 out of 3 Japanese tourists to Hawaii visiting a neighbor island, the Japanese edition of Aloha Airlines Spirit of Aloha in-flight magazine is read by thousands of travelers each day. Every morning approximately 1,300 copies of the magazine are inserted into every seat pocket on all Aloha Airlines and Island Air inter-island flights. The magazine can either be placed back into the seat pocket after it is read or the passenger may take it with them to refer to during their trip.

Aloha Airlines also aggressively seeks Japanese tour agencies. In fact, most JTB and Japan Airline tours are booked with Aloha. The airline holds annual meetings with travel agents in all major cities in Japan and distributes Spirit of Aloha to the agents. The magazine is also available at the HVCB Tokyo and Osaka offices, Aloha Airlines Japan offices, and at the annual World Travel Fair in Yokohama.

You can use Spirit of Aloha to reach your target market before they arrive at their destination. If you want to take advantage of the summer influx of Japanese visitors you have to act now! Please click here for more details.

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SARS & War Recovery: Want to be a part of these books? Click here for our Media Request Form or us.

Space Deadlines:

Aloha Express - September Quarterly - July 1, 2003
Nouveau - Ala Moana Center Selection - September/Fall issue - July 10, 2003
Chikyu no Arukikata - Maui Resort - July 15, 2003
Aloha Airlines - Spirit of Aloha - November issue - September 15, 2003

Material Deadlines:

Aloha Express - September Quarterly - August 4, 2003
Nouveau - Ala Moana Center Selection - September/Fall issue - August 10, 2003
Chikyu no Arukikata - Maui Resort - August 1, 2003
Aloha Airlines - Spirit of Aloha - November issue - September 30, 2003

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6/15 Father's Day
7/7 Tanabata (Star Festival)
7/21 Marine Day (Holiday)
8/13-8/15 Obon Season
9/15 Respect for the Aged Day
9/23 Autumnal Equinox Day

Click here to see entire year.

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