Japan Market Update - February 2005 Edition

Happy Valentine's Day ,

This is a busy time of year in Hawaii. Take Valentines Day (weekend), add in the Pro Bowl week events, and you have the perfect mix for a busy month. With all of the activities going on, it is difficult to find a hotel room or an available seat at a fine dining restaurant-good news for the tourism industry.

For business planning and promotions, it helps to know about upcoming events-whether they be sports, cultural, holiday or corporate-and their potential impact on a destination--and your business. Take the Erina Incentive Group from Japan for example. This group won trips to Hawaii as part of an incentive program. All 1800 participants visited Hawaii at the end of January. After Valentine's Day, the Diana Incentive Group, another large group of 1700 women, will visit Hawaii-giving retailers some extra business opportunities during the "off-season".

Not only is Hawaii being impacted positively by corporate incentive groups, but Guam received a boost to its economy when it welcomed over 1000 Amway participants on an incentive trip from Japan in January. In Guam, baseball spring training-for teams like the Yomiuri Giants from Japan and the Korean Samsung Lions-is also helping business and providing good media value for the destination-taking advantage of the extensive media coverage.

This leads to the hot topic of sports marketing. The Honolulu Marathon on Oahu in early December continues to positively impact Hawaii, with participants extending stays in the Islands. (In 2004, Japanese runners made up 61.2% of the entrants, the largest percentage in nine years.)

In addition, last year's 34th Maui Marathon attracted a record total of 2,801 runners due to a stronger Japanese economy and the addition of a half marathon. This event is now held September to attract off-season business(Sept 18, 2005). One of the longest consecutively held annual running events in Hawaii, the Maui Marathon has attracted major sponsors from Japan, including Runner's Inc., a premiere running publication, and Ryutaro Kamioka, a popular TV personality.

While this year's "Aloha Golf Season" began with the Mercedes Championship at Kapalua, Maui, and was followed by the Sony Open and the Turtle Bay Champions Tour http://www.hawaii.gov/tourism/, the LPGA Season opens with the (Seoul Broadcasting Systems) SBS Open at Turtle Bay on Feb. 21-27. This should be another exciting event that brings visitors to Oahu's North Shore for "Golf and Surf." Each event offers television opportunities for destination marketing.

Next month's Japan Market Update Report will include more information on sports tourism, and some efforts that are working well in Guam and Saipan as well as in Hawaii.

Below is the coming Japanese holidays thru May 2005. To view/print all the Japanese holidays for 2005, visit our Web at http://pacrimmarketing.com/info/index.html .

Included below for you is the spring/summer media line up. For the whole year schedule for all destinations, click: ( http://pacrimmarketing.com/ad/adsched.html ) We are here to help you open more doors to the Japanese consumer -- let me know how we can assist you!

Warmest regards,
Dave Erdman
derdman@pacrimmarketing.com

*Japan Market News
-----Travel: Honolulu Marathon to bank another successful year
-----Travel: Visas may be required (again!) to enter the U.S.
-----Travel: Japanese overseas travelers to reach 17.4 million in 2005
-----Fashion: Celebrity appeal and casual comfort rule Tokyo's fashion ranking
-----Business: Not just any "sweets for my sweetie" in Japan
-----Business: Japan's fiscal policy minister bullish on recoveryV
-----Business: Matsui, Ichiro, and Yong-sama rule TV ads
-----Technology: New iPod may leave competitors in the dust
-----Technology: Calculating the abstract value of Web equity
*Culture Corner
*Media of the Month
*Upcoming Magazine Deadlines
*Important Dates

Travel: Honolulu Marathon to bank another successful year

Participation, economic impact, future interest growing
Registrar figures showed that Japanese entrants for the 32nd Honolulu Marathon held last December increased by 3.6 percent compared to 2003, to 15,723. As a result, the economic impact is also likely to surpass the $86.8 million generated by the previous marathon. Marathon officials say participants usually travel with one to three friends and family members, which means that out-of-state visitors reached possibly 50,000 to 100,000 during the marathon weekend. Visitors packed Honolulu restaurants and hotels during the days surrounding the event, while most participants shopped and enjoyed other recreational activities after the marathon, says Honolulu Marathon President Jim Barahal. Meanwhile, the 2004 marathon coverage reached a wider Japanese audience, up 7 percent from a year prior to 2.4 million households. As interest and actual participation grow, so will the scale of future marathons. In addition to pre-race events, Barahal plans to promote the Living Aloha Expo again next year, which generated 30,000 visitors at the Honolulu Convention Center. Marathon participants, locals, and visitor browsed 140 booths set up by local businesses and official sponsors such as Nike, Japan Airlines, Amino-Value, Konami, and DC Card.
(Sources: www.honolulumarathon.org; The Honolulu Advertiser 12/18/04; Pacific Business News 12/17/04)
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Travel: Visas may be required (again!) to enter the U.S.

U.S. border control snag may necessitate visas to visit favorite destinations like Hawaii and Guam
Japanese citizens who obtain a new passport or renew an existing one during an approximate six-month period after October 26, 2005, may temporarily need visas to enter the United States. October 26th is the deadline imposed by the U.S. Department of Homeland Security for foreign nations to issue machine-readable passports that contain biometric identification of the passport holder. Japan is currently about six months behind the deadline for implementing the biometric passports, as are most other countries. If Japan does not meet the deadline, or if the deadline is not extended, Japanese citizens with passports issued after October 26th will need to obtain a visa at either the U.S. Embassy in Tokyo, or the consulate offices in Osaka or Okinawa. Japan has been one of 27 countries included in the U.S. Visa Waiver Program (VWP), which allows citizens of those countries to enter the U.S. for up to 90 days (15 days for Guam) without a visa, when traveling for pleasure or business purposes. VWP has been regarded highly as a traveler-friendly protocol making U.S. tourism, and last-minute travel, appealing to the estimated 4.5 million Japanese tourists who enter the U.S. annually.
(Source: Weekly Diamond Magazine 1/15/05; U.S. Embassy of Japan)
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Travel: Japanese overseas travelers to reach 17.4 million in 2005

JTB reports tsunami disaster likely will not impact Japanese outbound travel
According to a recent travel forecast for 2005, Japan Travel Bureau predicts the number of Japanese overseas travelers will increase by 3.6 percent to 17.4 million. An increasing number of mature market (50+) and business travelers will likely expand outbound travel. JTB also reported that the number of travel per year will increase slightly to 2.70 times compared to the previous year's 2.64. Average consumption during overseas travel is expected to ebb 1.3 percent to 306,200 yen (approx. $3,000), offset by an anticipated 2.2 percent increase in overall consumption at 5.3 trillion yen (approx. $51 billion). Although the tsunami disaster's negative impact on travel has been highly speculated, JTB expects the effect will be minimal; Southern Asia accounts for just 2 percent of outbound Japanese travel, according to JTB.
(Source: J-Wing Travel 1/11/05)
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Fashion: Celebrity appeal and casual comfort rule Tokyo's fashion ranking

High-end fashion mag lists the season's hottest "must-haves"

BeyoncŽ and Lindsey Lohan's favorite handbag was ranked the no.1 must-have item by Figaro Magazine Japon, the Japanese counterpart to France's Madame Figaro magazine. The "Luxe Trigger" bag (61,950 yen; $575) by New York designer Botkier reigned as the hottest item of the season, selling out at Tokyo's top six boutiques within days of hitting the shelves last November and December. Selling out in similar fashion are vintage Disney T-shirts and tanktops, which sell for 7,875 yen (approx. $76). Here's the top-five list:

1. Luxe Trigger bag by Botkier
2. Vintage T-shirt by Disney
3. Knit poncho by ChloŽ
4. Stretch denim by True Religion
5. Cashmere and beads scarf by Chan Luu

(Sources: Figaro Japon 12/20/04; Elle Japan Fashion News 1/16/05)
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Business: Not just any "sweets for my sweetie" in Japan

Stores and patrons go all out in preparation for Valentine's Day
Confections are a serious business in Japan, and that never becomes more obvious than during the weeks preceding Valentine's Day. Major department stores like Takashimaya and Isetan are hosting celebrity chocolatiers and patissiers from around the globe to create and promote some of the world's most incredible, delectable, Valentine's Day treats. Takashimaya will dedicate its entire 8th floor exhibition hall for an extravagant Valentine's-theme shopping experience, showcasing 52 brands of chocolates and sweets from eight countries. The hot item this year is "joint project chocolates," like the "Pascal CafŽ & Yasumasa Takagi 2005 Valentine's Collaboration Box," which contains four precious morsels created by these star chocolatiers (1,365 yen, approx. $14). Back by popular demand at Isetan, 16 world-famous chocolatiers will give live demos and seminars to 200 lucky shoppers each day for a week prior to Valentine's Day (Isetan had to set up a lottery system last year). Their creations will go on sale, as will 55 brands of chocolates from nine countries.
(Source: Tokyo Shimbun Shopper 1/12/05, 1/24/05)
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Business: Japan's fiscal policy minister bullish on recovery

Government official predicts Japan will pull out of stagnation by mid-year
Despite media attention on Japan's mediocre economic turnaround, Economic and Fiscal Policy Minister Heizo Takenaka says the nation's financial system will stabilize enough to speed up the recovery. As the nation's fiscal policy expert, Takenaka needs to be openly optimistic. But recent developments also suggest he has good reason to be bullish; the yen remains strong, as Japanese machinery orders jumped 19.9 percent in November, the biggest increase in more than four years. Wholesale price inflation also slowed in December for the first time in 10 months, easing pressure on companies to cut costs to protect profits. Meanwhile, Japanese banks are chipping away at their "bad loans," down to about 34.6 trillion yen (approx. $339 billion), or 17.8 trillion yen less than two years ago.
(Source: Bloomberg News 1/17/05) Back to top

Business: Matsui, Ichiro, and Yong-sama rule TV ads

Last year's cultural icons come out on top in TV commercial impressions
The faces of 2004 -- MLB heroes Matsui and Ichiro, and South Korean actor Bae Yong-joon -- who were featured throughout the year in Japan Market Update, ranked among the top celebrities to grace the commercial airwaves. South Korean heartthrob Bae and his dashing, trademark smile helped Otsuka Pharmaceuticals snag the top TV commercial award for his appearance in an "Oronamin C" nutrient drink ad, which helped boost sales by 10% for July and August. The winningest male celebrity in the 13th annual Nikkei TV Commercial Grand Prix survey was Takuya Kimura of the perennial boy band "Smap," who has ranked among the top ten for the last eight years. Among female stars, Nanako Matsushima was voted the most valuable celebrity for product endorsement. Once famous for her understated beauty and sex appeal, the new mom is now sought after by corporate sponsors for commercials targeting families. Ichiro's image as the leading hitter in the major leagues has been the focal point for Nikko Cordial Securities Inc., which credit him for upgrading the company's corporate image. Matsui was tapped by Japan Airlines and Meiji Yasuda Life Insurance Co., among a few others, for his "congenial" personality.
(Source: The Nikkei Weekly 1/17/05)
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Technology: New iPod may leave competitors in the dust

Apple Japan flexes its marketing muscle with a cheaper iPod smaller than a pack of gum
Just months ago, Sony Corp. declared a kind of "war" against Apple Computers Inc. from dominating the portable music market. But the founders of the original portable music player -- the Walkman -- may find it impossible to compete with Apple's new iPod shuffle, a 22-gram miniature model of the already-tiny iPod mini. Priced at just over 10,000 yen (approx. $99), the shuffle leaves Sony's pricier Network Walkman (the cheapest model costs 2.5 times the shuffle) in virtual dust. Yoshiaki Sato, representative director of Apple Japan, is so confident that Apple will outdistance its rivals, he predicts market share will boost from the current 50 percent to 70-80 percent. If anyone thought the iPod mini was a hit in Japan, Sakito says pre-orders for the shuffle have far surpassed that for the mini. With a Japanese version of the iTunes store scheduled to launch by year-end, 2005 is slated to be a good year for Apple.
(Sources: MacMinute 1/15/05; The Nikkei Weekly 1/17/05)
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Technology: Calculating the abstract value of Web equity

Top-ranked Toyota rakes in 98.5 billion yen in Internet-related sales and "Web presence" value
Web consulting firm Japan Brand Strategy, Inc. quantified the Web equity of Japan's top 250 companies, producing a straightforward ranking that revealed the Internet's powerful influence on the nation's most famous brick-and-mortar businesses. In a nutshell, Japan Brand Strategy added three components: 1) net sales resulting from products sold online; 2) net sales of products sold at retail outlets as a result of online advertising or marketing; and 3) the perceived value of improved product knowledge and brand presence as a result of online advertising or marketing. The simple formula, albeit the abstract components, put Toyota at the top of the list at 98.5 billion yen (approx. $956 million) in total Web presence value. Consumers don't buy cars online, but the success of Toyota's online advertising and marketing is perceived to have had the strongest impact -- worth 69.3 billion yen (approx. $672 million) -- on dealership sales in 2004. Meanwhile Toyota's online store, GAZOO, which sells car accessories and seasonal gifts, added just 3.3 billion yen ($32 million) to the value. Companies like ANA (3) and JAL (4) relied on direct online sales for an average of 55 billion yen ($533 million) of their Web equity. Toyota's lesson is that successful online brand presence and product knowledge -- not just B2C transactions -- can stretch the bottom line. Here's a top-ten listing (all figures in yen):

(Sources: Weekly Diamond Magazine 1/8/05; www.japanbrand.jp)


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Why does the new school year in Japan begin in April?

In 1872, Japan modeled its school system after the French school system, which began in April. During the Taisho period (1912-26), the government adjusted the school system to begin in September to imitate the Western calendar.

The September starting date, however, proved to be inconvenient, as the corporate fiscal year in Japan begins in April and is a time when businesses hire new employees from the universities and start new programs and activities.

In addition, cherry blossom season is in April and signifies a good time to begin something new. To the Japanese, whose traditions celebrate the changing seasons, it felt unnatural that something should begin in September with the cold winter on the way.

Therefore, after a short period of trying the Western school schedule, the school year was reverted back to the original system used in Japan, starting in April.

Based on Japan's current school year schedule, many students travel during late March for their spring break before the next school year begins. College students have up to four weeks of vacation--which for seniors represents a "last chance" travel opportunity before beginning work at a corporation.

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Here is a great opportunity to increase your exposure to the Japanese market visiting Honolulu. The Globetrotter June Honolulu Mook issue is currently accepting advertising reservations for the upcoming issue.

Read primarily by Japanese visitors who enjoy shopping and dining on their vacation (woman ages 20 -- 40), the Globe Trotter Mook contains information about various activities on Oahu and is designated by Ala Moana Center and Royal Hawaiian Shopping Center, two very popular visitor destinations.

The Mook is sold in all major book stores throughout Japan, making it an easy way to reach the Japanese travel market.

Don't let this important opportunity pass you by. If you are interested in finding out more about advertising in this publication please contact Lynelle Lingaton at llingaton@pacrimmarketing.com

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Click here for our Media Request Form or contact us.

Space Deadlines:

2/15/05 Chikyu No Arukikata -- Hawaii Guidebook
2/15/05 Chikyu No Arukikata -- Family Guidebook
3/1/05 Chikyu No Arukikata -- Guam Mook
3/5/05 Chikyu No Arukikata -- Honolulu Mook
3/10/05 Nouveau -- Nouveau Tumon Sands
4/10/05Nouveau -- Ala Moana

Material Deadlines:

2/10/05 Nouveau -- Spring 2005
3/1/05 Chikyu No Arukikata -- Hawaii Guidebook
3/4/05 Chikyu No Arukikata -- Family Guidebook
4/1/05 Chikyu No Arukikata -- Guam Mook
4/1/05 Chikyu No Arukikata -- Honolulu Mook
4/10/05 Nouveau -- Nouveau Tumon Sands
5/10/05Nouveau -- Ala Moana

It is not too late to call us (808-949-4592 or Toll Free 1-800-338-4502) to find out more about these upcoming media releases as we strive to find the best media available for you.

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Upcoming Holidays in Japan

2/11 Kenkoku Kinenbi -- National Foundation Day
3/21 Shunbun no Hi -- Vernal Equinox Day
4/29 Midori no Hi -- Green Day
4/29 Golden Week Begins (ends May 5)
5/3 Kenpo Kinenbi -- Constitutional Memorial Day
5/5 Kodomo no Hi -- Children's Day
5/10 Haha no Hi -- Mother's Day

Click here to see entire 2005 year.

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