Japan Market Update - September 2005 Edition

Hi ,

September will be a very interesting and exciting month in the world of Japanese politics. September 11, 2005, has been designated as an election day for the lower house by Prime Minister Koizumi. Koizumi's reform measures to privatize Japan's postal system were voted down in early August. Koizumi was so frustrated at the vote that he dissolved the lower house and called for an election. Now he is backing candidates who support the privatization and other reform measures, and has tapped celebrity power to run against those who did not support him and his reforms. Included is Takafumi Horie, CEO of an aggressive Japanese Internet company, Livedoor. Horie will run against a staunch opponent to Koizumi in Hiroshima.

Koizumi has staked his future and his support of reform measures on this election, and said he will step down if he cannot move his reforms forward. This gamble by the Prime Minister will decide the future of Japan's reform moves. Koizumi's platform has major business support.

Other stories you will find in our Japan Market Update Report include updates on outbound travel from Japan, the wedding market in Guam, and the big hit in Japan--iTunes and iPod.

September will also host two Japanese holidays which will positively affect overseas Japanese travel. Check the calendar below.

Let us help you get ahead! We can help you and your organization tap into new opportunities as you plan for 2006 marketing efforts.

*Japan Market News
-----Travel: Japan overseas travel may reach 17.5 million
-----Travel: Watabe Wedding takes over two Guam chapels
-----Travel: JAL ends Hawaii, Guam and Saipan routes
-----Business: Wal-mart to open in Japan next year
-----Business: iTunes Japan debuts with a bang
-----Business: Department store sales rise
-----Technology: 3G mobile service tops 19 million
-----Politics: Japanese public to vote on Koizumi's fate
-----Politics: Livedoor CEO makes election run
-----Society: Why Japanese women don't want more kids -- Part one in a series
*Culture Corner
*Media of the Month
*Upcoming Magazine Deadlines
*Important Dates

TRAVEL: JAPAN OVERSEAS TRAVEL MAY REACH 17.5 MILLION

Travel agency research shows Japanese travelers are becoming older and savvier
The JTB Foundation, a research arm of travel giant JTB Corp., announced at the 10th Overseas Travel Movement Symposium in July that the number of Japanese overseas travelers is expected to reach 17.5 million for the 2005 calendar year. It would mark the second-best year in travel since 2000, when 17.82 million Japanese traveled overseas. JTBF also said that the Japanese travel market has the potential to reach 18 million a year, yet that effort is hampered by political strains with China, terrorist activities in Europe, the effect of rising fuel prices on airfare, and the negative implications of Japan Airlines' withdrawal of the Saipan route. JTBF also said seasoned tourists (those who have traveled abroad more than ten times) increased by an astonishing 39 percent last year, and account for 61.4 percent of all Japanese tourists. Additionally, 60 percent of the seasoned travelers are 50 years old and older, representing the strongest segment in the overseas travel market.
(Source: J-Wing Travel 08/01/05)
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TRAVEL: WATABE WEDDING TAKES OVER TWO GUAM CHAPELS

Management changes hands from one Japanese wedding company to another
Newlyweds-to-be will most likely not notice, but effective January 1, 2006, two Guam chapels will switch allegiances and join the more than 150 chapels and wedding sites worldwide operated by Japanese wedding conglomerate Watabe Wedding Corp. St. Leo Chapel and Del'Anello Chapel, currently run by property management company Leopalace 21 Corp., will henceforth be managed by Watabe Wedding. Leopalace 21 has technically leased the two properties, but Watabe will assume all front-line activities including wedding preparations and ceremonies, as well as marketing, advertising, and promoting. Watabe plans to begin selling new wedding packages featuring the two chapels by April next year. Watabe also projects 1,200 weddings at the two chapels for 2006.
(Source: Travel Vision News 8/08/05)
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TRAVEL: JAL ENDS HAWAII, GUAM AND SAIPAN ROUTES

Saipan loses critical tie to Japan despite pleas from officials and travel industry representatives
In an extreme measure to streamline its operations, Japan Airlines announced it will suspend routes for Fukuoka-Honolulu, Nagoya-Guam, Tokyo-Saipan, and Osaka-Saipan effective October 2005. Additionally, flights from Osaka to Honolulu will be reduced from twice to once daily. The news is a big blow to Saipan, which welcomes about 15,000 Japanese tourists monthly, and stands to lose about $80 million a year. Northwest Airlines will now be its only direct tie to Japan, with two daily flights to/from Tokyo, and once to/from Nagoya. In its press release, JAL explained an overhaul of its routes was necessary to combat rising fuel prices, to keep passenger airfare competitive, and to redistribute flights following the decommissioning of three aircrafts this year. JAL will, however, continue its Tokyo-Guam and Osaka-Guam routes. With rival All Nippon Airways only offering one daily service between Osaka and Guam, it is apparent that Continental Airlines will be the biggest player in the Japan-Pacific market. Continental currently flies to Guam from eight Japanese cities, including three daily flights from Tokyo and twice daily from Nagoya.
(Source: JAL Press Release 7/29/05; Pacific Magazine 7/05)
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BUSINESS: WAL-MART TO OPEN IN JAPAN NEXT YEAR

Struggling Seiyu will start opening superstores and closing unprofitable outlets
Seiyu Ltd. will begin opening megastores under the Wal-Mart brand next year, aiming to turn around its slumping business, according to press reports. Top shareholder Wal-Mart Stores Inc. is expected to turn Seiyu into a subsidiary as early as this year, after which it plans to develop new stores that combine discount outlets and supermarkets. So far, Wal-mart's bargain mantra "Everyday Low Prices" doesn't seem to have caught on with Japanese consumers, just as industry analysts predicted earlier in the Seiyu-Wal-Mart partnership. In fact, Seiyu continues to struggle with rising operational costs and computer system issues, and expects its fourth year of losses this fiscal year. But according to Nihon Keizai Shimbun, Japan's Business Daily, Wal-Mart still plans on pumping 50 billion yen ($467 million) into the business over a five-year period, apparently not giving up on a turnaround.
(Sources: Nihon Keizai Shimbun 07/05/05; Yahoo! Asia News 8/17/05)
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BUSINESS: ITUNES JAPAN DEBUTS WITH A BANG

Apple's iTunes Music store sells one million songs in first four days
Japan's music fans heralded the much-anticipated debut of the iTunes online store, downloading over one million songs within the first 96 hours. Songs are prices at 150 to 200 yen (approx. $1.40 to $1.87), and include exclusive tracks by favorite international artists such as Jack Johnson and U2. True music to their years, Japanese customers can also download original iTunes tracks by many of the nation's top-selling artists. As of August, the best-selling song was by Japanese group Def Tech, and the best-selling album was by Japan's Ulfuls. The new iTunes store also features a free, browse-ready directory of over 6,000 podcasts -- online "radio" broadcasts -- including local and minor stations as well as global stations such as CNN and Disney.
(Sources: Apple News Release 8/8/05; www.apple.com/jp/itunes; Japan Today 8/9/05)
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BUSINESS: DEPARTMENT STORE SALES RISE

Short-sleeve dress shirts help boost store sales above 2001 levels
It's yet to be seen if Japan's first nationwide "Cool Biz" casual-dress campaign is cutting energy spending this summer, but it sure has padded the bottom line for Tokyo department stores. Overall store sales in Tokyo rose 1.2 percent in July to 184.6 billion yen (approx. $1.7 billion), boosted by a 6.3 percent rise in men's clothing sales. Not surprisingly, casual wear, short-sleeved shirts, and light-weight jackets were among the best-selling items. Overall sales of clothing, the largest product segment, rose 4 percent, up for the first time in almost a year and a half, despite a 9.5 percent slump in children's clothing sales.
(Source: Kyodo News 8/15/05) Back to top

TECHNOLOGY: 3G MOBILE SERVICE TOPS 19 MILLION

NTT falls behind as KDDI wins mobile service war
Japan's telecommunications giant KDDI Corp. announced the number of subscriptions to its third-generation mobile phone service topped 19 million in July, three years since its launch in April 2002. The nation's telecom leader, NTT DoCoMo Inc. has battled competition from KDDI since NTT's 3G launch in October 2001 as the first company in the world to offer the video-capable mobile service. From the get-go, NTT suffered glitches to its mobile service and had amassed only 1.1 million subscribers by June 2002 against KDDI's 1.4 million in just 2 months. KDDI's "au" brand of third-generation mobile service operates on devices manufactured by electronics leaders such as Toshiba and Sanyo. Not just a cell phone anymore, these high-tech phones can display and record TV shows, run Java ª applications, send and receive "movie mail" messages, and even navigate users through city streets.
(Sources: Wireless Business and Technology 8/15/05; Kyodo news 8/15/05)
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POLITICS: JAPANESE PUBLIC TO VOTE ON KOIZUMI'S FATE

PM calls for emergency elections after he loses bid for postal reform
Japan's political climate is boiling over this summer. In early August, Prime Minister Junichiro Koizumi's postal reform bills were rejected by the Diet's upper house members, after which Koizumi called for snap elections on September 11th as a means to make the Japanese public decide the fate of the biggest agenda of his political career. Koizumi said he would resign if his Liberal Democratic Party fails to win a majority. Under Koizumi's bills, Japan Post would have been split into four business units: mail delivery, savings, life insurance, and post office network. The two financial spin offs -- savings and life insurance combined -- would have created the biggest, private financial network in the world, rivaling U.S.-based Citigroup. Koizumi has argued that the banking arm, currently with $3 trillion in holdings, would not only generate $4.4 billion in taxes in its first fiscal year if privatized, but would revitalize the economy by attracting foreign investments. Japan Post has been criticized for symbolizing Japan's "bloated bureaucracy," with its surplus often used to fund what critics call wasteful public projects. Koizumi's opponents say privatization will cut postal service to certain rural areas, and cause unnecessary layoffs.
(Sources: Reuters Japan 8/29/05; www.cnn.com 8/8/05)
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POLITICS: LIVEDOOR CEO MAKES ELECTION RUN

Media mogul hopes to support Koizumi in postal privatization drive
Takafumi Horie, CEO of Livedoor Co., one of Japan's leading Internet content providers, will run on the ruling LDP ticket in the upcoming general election on September 11. As an independent, he is set to challenge former LDP policy chief Shizuka Kamei, one of the party's leading rebels who drove the effort to get Koizumi's reform bill rejected last month. "There is a possibility I could have a significant influence and get a sense of being able to change Japan," Horie told reporters. Considered a "mover and shaker" within the media industry, and known for his ambitious business tactics, the 32-year-old Horie made headlines earlier this year during his aggressive takeover of Nippon Broadcast Systems.
(Sources: Japan Today 8/20/05; Reuters Japan 8/29/05)
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SOCIETY: WHY JAPANESE WOMEN DON'T WANT MORE KIDS -- PART ONE IN A SERIES

"Japan's census data shows that in 1950, women bore an average of 4.4 children over her lifetime. Two generations later, in 2002, that number has fallen to 1.3 children. As Japan's birthrate plummets and the nation's social security system enters crisis mode, we take a look at the problem from the point-of-view of the average Japanese woman. In this excerpt, the underlying issue is of women feeling fulfilled with raising a single child.
"The more we value our children, the fewer children we have." It's a commentary by sociologist Masahiro Yamada, and the paradox endorsed by an increasing number of Japanese mothers. These women adore their children, and enjoy caring for them, but because their satisfaction of raising their only child is so great, they don't feel a desire to change the family dynamic. "Why bother," says a 30-year-old mother who works from home, "My daughter is so adorable to me right now, I want to spend all the time that I can with her." Another mom, who initially wanted three children right after marriage, says raising her daughter has given her enough fulfillment for the time being. Like most parents, she wants only the best for her daughter, so when her third-grader asked for a chance to attend a private middle school that has air conditioning, she complied. "It may sound silly, but my daughter has been weak since she was young, and the summer heat is physically hard on her." So for this family, preparing their daughter for private school will mean spending thousands of dollars on cram schools and prep classes for the next three years.

Many members of the public scorn parents who dote too heavily on their only child. But are they really getting spoiled? Not so, argues Yumiko Sugiyama, author of "Raising Children in Only-child Times" who says an only-child thrives, both socially and intellectually. She says an only-child is given more attention and is often allowed more opportunities to pursue extracurricular activities that may not be possible in a multi-child household.

In the end, the decision to have more than one child is up to the parents to decide. But as more parents defy the pressures of society -- and even the government's -- to bear more children, more social experts such as Yamada and Sugiyama are speaking out in support of Japan's changing family landscape. Parents are simply becoming more responsible, they say, and ultimately what's important is not to merely increase the child population, but to "raise more happy children."
(Source: japan.internet.com 7/25/05)
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RAMEN

Ramen, originally called La Mian in China, has become firmly assimilated into Japanese culture. Mostly sold at counter shops, food stalls, and train stations, ramen is extremely popular for being tasty yet inexpensive. The dish is also commonly made at home, due in part to its quick and easy preparation.

Most ramen noodles are made from four basic ingredients: wheat flour, salt, water, and kansui (a type of water that gives the noodles its yellowish color and particular flavor). If kansui is not available, eggs are used as a substitute. The noodles come in a variety of shapes and lengths. They can be fat, thin, wavy, or straight. There are also generally four types of Ramen Soup: Miso (bean paste), Shio (salt), Shoyu (soy sauce), and Tonkotsu (pork broth).

Every prefecture in Japan has its own special variation of this well-liked food, such as corn-butter ramen in Hokkaido and tonkotsu ramen in Kyushu. Instant ramen was invented in 1958 and, in a Japanese survey, was credited to be the greatest Japanese invention in the 20th century. Many varieties of this invention, where you just add hot water to a pre-packaged bowl, are available in supermarkets and convenience stores and are a staple food amongst college students.

(Source: Japan-zone.com and wikipedia.com)
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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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Space Deadlines:

NOW! Chikyu no Arukikata Guam Guidebook
NOW! Chikyu no Arukikata Hawaii Mook
NOW! Aloha Express November: Yearbook
NOW! Nouveau Tumon Sands Winter 2005
NOW! Chikyu no Arukikata Hawaii Guidebook II
NOW! Nouveau Hawaii Winter 2005

Material Deadlines:

9/2/05 Chikyu no Arukikata Guam Guidebook
9/2/05 Chikyu no Arukikata Hawaii Mook
9/9/05 Aloha Express November: Yearbook
9/16/05 Nouveau Tumon Sands Winter 2005
9/30/05 Chikyu no Arukikata Hawaii Guidebook II
10/14/05 Nouveau Hawaii Winter 2005

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

9/19 Keirou no Hi -- Respect for the Elderly Day
9/23 Shuubun no Hi-- Automnal Equinox Day
10/10 Taiiku no Hi -- Sports Day
11/23 Kinrou Kansha no Hi -- Labor Day
12/23 Tennou Tanjoubi -- Emperor's Birthday

Click here to see entire 2005 year.

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