Japan Market Update - August 2006 Edition

Hi ,

Hope you are having a great summer!

Summer is a peak overseas travel time for the Japanese. Family travel is most popular during this time period as Japanese elementary to high school students generally have off from July 20 until the first week of September.

The Obon season begins the second week of August, and often coincides with corporate holidays. Employees are encouraged to take summer vacations, which many companies and government agencies authorize until the end of September. September is generally a positive month for Japanese overseas travel due to multiple holidays, including September 18, 22, and 23.

Below, we have noted some summer-specific trends and also have taken a look at some overall retail and consumer trends of potential interest or importance to your business or marketing approaches.

Warmest regards,
Dave Erdman
derdman@pacrimmarketing.com

*Japan Market News
-----Travel: Positive outlook for Hawaii's Japan market
-----Travel: "Family" and "resorts" key to summer travel
-----Travel: Japan may lift ban on casinos
-----Travel: JTB's "island for two"
-----Business: Coke tries to put the fizz back in Japan
-----Business: Takashimaya to partner with upscale grocery store
-----Fashion: Feminine styles top fashion ranking
-----Fashion: Yukata goes mainstream
-----Technology: iPod dominates portable players in Japan
-----Science: Japanese citrus may prevent "economy class syndrome"
*Culture Corner
*Media of the Month
*Upcoming Magazine Deadlines
*Important Dates

TRAVEL: POSITIVE OUTLOOK FOR HAWAII'S JAPAN MARKET

Higher per capita spending and increased air capacity suggest market is "not as weak" as expected
According to Hawaii Tourism Japan, total spending by Japanese visitors was 99.7 percent of last year's levels, despite the fact that arrivals for the first five months this year were down almost 8 percent. That means per-person-per-day spending has increased, in fact about 9.6 percent to $269. And while downsized air capacity has been largely blamed for Hawaii's arrival woes, Northwest Airline replaced the DC 10-30 jet flying Tokyo to Honolulu, with a larger B747-400 aircraft. The change, which took place mid-July, will add approximately 4,000 seats per month to Japan's tight airlift supply. However, there's no end in sight for record fuel surcharges; according to All Nippon Airways, roundtrip fuel surcharges are now 16,000 yen (approx. $132), or more than triple from January 2005. Though rising incrementally this summer, ANA's roundtrip surcharge for trips to Guam is 7,800 yen ($64); 3,400 yen ($29) for Hong Kong; and 2,600 yen ($22) for China and Korea.
(Sources: Pacific Business News 7/17/06; ANA Group 7/19/06)
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TRAVEL: "FAMILY" AND "RESORTS" KEY TO SUMMER TRAVEL

JTB survey shows overseas resorts and family travel still popular during summer season
Hawaii and Guam are still among the top five overseas destinations for the summer, according to a recent survey by travel agency Japan Travel Bureau. A sweeping 97 percent of respondents said they wanted to travel with family this summer. Women (45 percent) did the bulk of the planning, although men (39 percent) were also active in the decision process. As for influential factors in planning their trips, the convenience of tour schedules (38 percent) was followed by lodging choices (23 percent) and low prices (18 percent). Notably among senior respondents, women in their 70s preferred the atmosphere of the location; those in their 60s prioritized personal contact with nature and local people.
(Source: Travel Journal International 7/26/06)
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TRAVEL: JAPAN MAY LIFT BAN ON CASINOS

Harrah's, Sands could operate in Japan if government issues licenses for gaming resorts
The Japanese government may step in to help revive the nation's stagnant gaming industry by lifting a ban on casinos, which would allow global casino operators such as Las Vegas Sands Corp. and Harrah's Entertainment Inc. to operate in Japan. The government may initially issue two to three casino licenses estimated to each cost around the Las Vegas Sands' recent $3 billion investment in Singapore. Casino operators are interested in Japan primarily because of its gross domestic product per capita of $39,195 - the highest in Asia - and for its well-established gaming culture, including legalized betting on horse racing, "keirin" pace-cycling races, and motor boat races. Japan's most ubiquitous gaming institution - pachinko - has actually seen a revenue decline in recent years, causing many pachinko "parlors" to close shop.
(Source: Bloomberg 7/24/06)
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TRAVEL: JTB'S "ISLAND FOR TWO"

Exclusive tour package at private island will target Japanese honeymooners and high-rollers
JTB will soon offer a week-long Maldives tour package that includes four nights on an exclusively reserved island on the Indian Ocean. The 8-million-yen (approx. $70,000) package for two people covers accommodations in one of four luxury cottages, access to a deluxe motor cruiser, a private spa, and a staff of 30 including a personal chef and a diving instructor. The tour accepts up to 15 customers, for an additional charge of 980,000 yen ($8,600) per person. Private island stays are already popular among the rich and famous in the U.S., such as the Musha Cay island in the Bahamas, where accommodations start at around $25,000 per night and similarly includes a 30-person staff.
(Sources: Mainichi News 7/28/06; unusualvillarentals.com)
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BUSINESS: COKE TRIES TO PUT THE FIZZ BACK IN JAPAN

Beverage maker fights back lackluster sales with more marketing and a new CEO
From royal milk tea and Coenzyme Q-infused beauty concoctions to Minute Maid orange juice and the classic Coke, Coca-Cola Japan has successfully tailored its myriad of products to consumers' varying tastes and habits, generating about 20 percent of the parent company's annual profit and making Japan its most profitable market. But instead of scoring 6 to 8 percent annual growth in operating profit, the soft-drink colossus faced a 2 percent decline in sales volume in the first quarter, alarming analysts during recent months. Coke Japan's revenue is largely driven by its Georgia brand, the country's most popular canned coffee drink since 1975. An aging Georgia-drinking population was thought to be a cause for sales decline, but new coffee flavors and a marketing campaign aimed at attracting younger consumers backfired, only to alienate existing ones. As a result, Georgia sales have declined for most of the year. Coke suffered another blow in May, when it was forced to recall 2.7 million bottles of soft drinks after a contamination scare involving iron powder. The company has since reshuffled management, replacing a Japanese president with Dan Sayre, an American previously in charge of the central Latin America division. Coke's next priority will be to restore the Georgia brand, which accounts for about a third of Coke's volume in Japan, or half its profit there.
(Sources: post-gazette.com 7/11/06; Financial Times 7/18/06)
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BUSINESS: TAKASHIMAYA TO PARTNER WITH UPSCALE GROCERY STORE

Kinokuniya-Takashimaya tie-up will target high-end clientele
Gourmet supermarket chain Kinokuniya Co. and department store chain Takashimaya Co. have agreed on a business tie-up to introduce a new line of high-end grocery stores. Kinokuniya, Japan's oldest supermarket chain established in 1910, is also a popular purveyor of imported foods and sundries. The first tie-up shop will be a small-scale, 500-sqft. Kinokuniya outlet located in the "depachika" section - the basement-level, food wonderland at most department stores - at the Takashimaya in Shinjuku. By partnering with Kinokuniya, Takashimaya hopes to create an upscale edge against competitors such as Isetan and Seibu department stores, also popular for their massive depachika sections. Takashimaya grossed 13 billion yen (approx. $110 million) for the year as of February 2006, considered weak sales compared to that of competitors.
(Source: Nikkei.net 7/24/06; The Japan Times 7/26/06)
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FASHION: FEMININE STYLES TOP FASHION RANKING

Spring and summer fashions predictably feminine and romantic
An unusually cool and wet transition from winter to spring meant warm-weather clothes took its time to make store shelves, but fashion media Senken newspaper nonetheless spotted the biggest to-be trends of the season. Frills, lace, ribbon, and puff sleeves remain popular, while runway fashion such as the comeback of "traditional," '80s, and marine styles are gradually surfacing in the market. The ranking is as follows:
Cache Coeur (wrap) dress
Frill blouse
Puff sleeves
Short pants
Short sleeve jackets
Layered dress
Bordered knits
Polo shirts
Long trenc
h Bolero tops
Balloon skirt
Wedge sole sandals
Salopettes (overalls)
Belts
Jersey jackets
(Sources: fibre2fashion.com 7/18/06; senken.co.jp)
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FASHION: YUKATA GOES MAINSTREAM

Men and women warm up to going in public with the summer kimono
Once a sight to behold only at bon festivals, fireworks displays and other traditional Japanese summer events, men and women clad in yukata - or a cotton summer kimono - are being spotted in greater numbers than ever, at sporting events such as soccer and baseball games, at social gatherings, and at numerous outdoor parties. Yukata fashion has become the nouveau summer chic, buoyed by the resurging popularity of retro and vintage kimono designs, not to mention brand name support by the likes of Marc Jacobs, who recently lent his talent to create the "designer yukata." High-end garb, such as Jacobs', retail for about 48,300 yen (approx. $420), and a good obi, or sash, costs about 10,000 ($87). Yukata traditionally features summer icons such as morning glories, dragon flies, and chrysanthemums. But unorthodox designs are now in the mix, including replaceable collars, creative obi clasps, and even large corsages to adorn the sash. Men's yukata designs have also flourished, though still dominated by cool, chic black tones. The yukata style has unofficially upgraded the "pair look" - a source of both adoration and ridicule, depending on how tastefully it's done - and a popular manner of dress in Japan where couples wear matching articles of clothing, typically T-shirts and outerwear.
(Source: Trends in Japan 7/7/06)
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TECHNOLOGY: IPOD DOMINATES PORTABLE PLAYERS IN JAPAN

Battery life and storage capacity top areas of improvement desired among users
By now it's old news that the Apple iPod exploded in Japan, and hardly surprising that 50 million iPods - including the original, mini, shuffle, nano -- have sold nationwide. But how do those numbers translate on the streets? According to a random poll of 300 Internet users by Japanese IT research firm Cross Marketing Inc., a good majority of portable player owners were iPod users. Apple topped the rank of MP3 player brands at 29.4 percent, followed by Sony at 20.3 percent and a series of national brands (Panasonic 12.6 percent, Sharp 8.4 percent, Rio 4.9 percent, Toshiba 2.8 percent). Korea's MP3 player powerhouse iRiver held a 7.7 percent share in the Japanese poll, way ahead of the game than Samsung (0.7 percent). The price point for most of the MP3 players was between 10,000 yen and 20,000 yen (approx. $85-$170). An iPod nano with 1GB storage retails for around 17,000 yen ($145), while a 6 GB iPod mini costs around 44,800 yen ($383).
(Sources: japan.internet.com 7/13/06; ja.wikipedia.org)
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SCIENCE: JAPANESE CITRUS MAY PREVENT "ECONOMY CLASS SYNDROME"

Mild-flavored kabosu lime could become ingredient for drinks and other consumables
While as common in the Japanese kitchen as the pungent yuzu and tangier sudachi fruits, it's as of late that the kabosu lime has garnered international attention as a possible defense against "economy class syndrome," a potentially fatal condition medically known as deep-vein thrombosis (DVT). DVT is caused by the formation of blood clots in the lower leg after a person is confined in a small space - such as an aircraft seat - for more than six hours. About 4,000 cases of DVT are documented in Japan annually, including a large percentage of those who experience symptoms of leg pain and respiratory problems (a more severe symptom) during air travel. A research team at Oita University, in conjunction with the Oita prefectural government, are examining the effect of kabosu extract and its strong antioxidants on controlling platelet aggregation. Test tube experiments have so far shown that a component of kabosu extract does, in fact, have a "thinning" effect on human blood. Anticoagulants like these can have reverse health effects, however, because they can cause problems when trying to stop bleeding. The research team will partner with a local pharmaceutical company to develop a prophylactic drink that includes kabosu's blood clot-fighting component.
(Source: The Daily Yomiuri Online 7/25/06)
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HANAFUDA CARD GAME

Hanafuda is a Japanese style card game that was developed over a period of several centuries. The history began with the introduction of Portuguese playing cards in 1549 by a crew of European travelers who landed in Japan. The Western card game caught on quickly, but the game was banned in 1633 when Japan closed off contact with the Western world.

The popularity of the Western card games inspired the invention of new card games. Over time the Japanese government banned such games due to excessive gambling. The laws eventually eased up on the restrictions once the government realized that gambling was inevitable. By this time, the game Hanafuda had been invented through the combination of traditional Japanese and Western style card games. However, the popularity of Hanafuda was not as strong due to decades of governmental repression of such games.

In 1889, a man created a company called Nintendo Koppai that produced and sold Hanafuda cards. Though it took some time, the popularity of Hanafuda grew as the Yakuza ("Japanese mafia") began to play the game in gambling parlors. Presently, the game is commonly played in places like Hawaii, Korea, and Japan.
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Aloha Express Hawaii Gokutabi (Freestyle Travel Hawaii)

Hawaii Gokutabi, or Hawaii Freestyle Travel, is a one-of-a-kind publication designed to make decisions easier for the Japanese traveler. With its primary focus on Japanese hotels, the book features detailed information and photos about a wide range of hotel rooms and suites, views, and the amenities that are available to the reader. Also featured are shopping, dining, and activities.

Hawaii Gokutabi reaches everyone from the sophisticated travelers to the Hawaii-enthusiast repeat travelers, who are looking for details about where to stay and what to do.

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

Click here for our Media Request Form or contact us.

Space Deadlines:

NOW! Chikyu no Arukikata Guam Guidebook
NOW! Chikyu no Arukikata Hawaii with Kids
NOW! Chikyu no Arukikata Hawaii Mook
9/1 Aloha Express November Yearbook
9/1 Nouveau Tumon Sands Plaza
9/15 JAL In-Flight Video
11/1 Aloha Express Hawaii Gokutabi (Freestyle Travel Hawaii)
11/1 Chikyu no Arukikata Excellent Hawaii Mook

Material Deadlines:

NOW! Chikyu no Arukikata Guam with Kids
NOW! Aloha Express September
NOW! Chikyu no Arukikata Romance Hawaii Mook
NOW! Chikyu no Arukikata Maui Resort
9/1 Chikyu no Arukikata Guam Guidebook
9/1 Chikyu no Arukikata Hawaii with Kids
9/1 Chikyu no Arukikata Hawaii Mook

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

09/18 Keirou no Hi - Respect for the Elderly Day
09/23 Shuubun no Hi - Autumnal Equinox Day
10/09 Taiiku no Hi - Sports Day
11/03 Bunka no Hi - Culture Day
11/23 Kinrou Kansha no Hi - Labor Day

Click here to see all Japanese holidays for 2006.
Click here to see all US holidays for 2006.

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