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Dave Erdman Featured in Japan Entrepreneur Report
 Dave Erdman was featured in Japan Entrepreneur Report (a monthly Email newsletter) on outbound travel opportunity. Click here or on the link below in bold to read article.
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Japan Entrepreneur Report No. 22 August 2004
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- Billion dollar beach
- Dave Erdman on outbound travel opportunity
- Trust in failure
- Action plan
- Bits and bytes
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Billion dollar beach
Where can you find, within a single square mile, a stable population of
20,000 well-heeled, free-spending Japanese tourists--a cohesive community
replaced and replenished every four days with eager new visitors--
together spending, on average, U.S. $5 million per day?
There's only one such place in all the world: Waikiki.
A beach earning more than a billion dollars a year has to deliver the
goods, and Waikiki--and the rest of Hawaii--performs, year in and year
out.
There's a simple reason: value. No other location can match Hawaii's
pure vacation appeal to tourists from Japan. What other destination
combines perfect year-round weather and pristine natural beauty--the
antithesis of sweltering summers in gunmetal gray Tokyo--with a cultural
and linguistic heritage that instantly puts visitors at ease?
Hawaii is a long-standing favorite, but in recent years Japanese
travelers have set their sites beyond the billion dollar beach to closer
destinations, including Taiwan, Korea, Southeast Asia and China. And
where outbound visitors venture, concentrated spending power and
entrepreneurial opportunity follows.
This month we examine how one entrepreneur seized the outbound travel
market opportunity, building a solid Japan-based business from Honolulu.
Readers living in destinations newly discovered by visitors from Japan:
Take note.
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Dave Erdman on outbound travel opportunity
Japanese travelers aren't the only ones enamored with Hawaii. Many
longtime expatriate residents of Japan find themselves drawn to the
islands' gorgeous mix of climate, beauty and Asian cultural elements.
That attraction has made Hawaii a kind of halfway house for expatriates
returning to the U.S. from Asia. I stopped by for a few years myself
before making it back to the mainland.
That's when I first met Dave Erdman. He made a similar journey, but
stayed on in Hawaii to become one of the world's top hands-on experts on
Japanese outbound tourism. Following are excerpts from a telephone chat
Dave and I enjoyed earlier this month.
- You've been involved in the outbound Japanese tourist market for more
than 25 years.
I started my travel career with a hotel here in Hawaii, then spent ten
years at Tropical Rent-a-Car Systems, Inc. After that, I started my own
company, PacRim Marketing, which provides database marketing, direct
marketing, public relations and related services to a wide range of
companies in the hospitality and tourism sectors. Early on we became the
Hawaii advertising representative for Chikyu no Arukikata, or
Globetrotter, Japan's largest travel guide publisher. They have more than
200 books covering destinations worldwide. Now we're celebrating our 15th
year in business and our fifth year running Hawaii-Arukikata.com, a
companion site to the paper guide.
- The Web site is quite successful...
Yes. We have 15,000 unique visitors every day and 3,500 pages of content
updated daily. We're generating more than $200,000 in hotel and activity
reservation revenues per month, and have solid advertising, advertorial,
cobranding and market research revenue streams as well. One key to the
site's success is JpRes, the reservation engine we developed that
provides a Japanese interface and e-mail responses to visitors, and
English language output to the vendor. This can be completely automated,
though most of our customers choose our operator mediation service,
because half of all Japanese consumers reserving online make special
requests that require human response. Our research shows that 50 percent
of all Japanese consumers will leave a hotel reservation Web site when
presented with an English-only reservation form.
- Do you plan to offer this service outside of Hawaii or in other
languages?
Yes. We will have 65 hotels in Hawaii online by the end of next month,
and Guam and Saipan are next. Then we'll offer JpRes for New York, Las
Vegas, and the West Coast, and eventually for Asian markets. JpRes can be
easily adapted to Chinese, Korean and other languages.
- What happens when a customer enjoys fabulous Japanese service online,
but shows up in, say, a San Francisco hotel where none of the staff
speaks Japanese?
Setting expectations is crucial. The response mails clearly state the
local level of Japanese language ability, if any, so travelers know what
to expect. Japanese travelers love the local ambience and excellent
service and rarely have problems. We offer a telephone-based
interpretation service for those rare occasions involving a complex
communication.
- Give us some universal business truths (UBT) for the outbound Japanese
travel market.
Travel retailing is big business. Shopping is high on almost every
visitor's list of activities, for several reasons. First, they can enjoy
time for shopping they ordinarily lack when not on vacation. Second,
there's a huge range of merchandise not found in Japan, plus items that
are available back home but only at higher prices. Finally, many
travelers need to buy a lot of omiage, or souvenirs, for friends,
relatives and colleagues. The key is to spread the word about your
store's location and merchandise, using an appropriate mix of media
channels: print, guidebooks, television and the Internet.
The Internet is the most powerful force in travel today. It enables
consumers to bypass travel intermediaries if they choose to do so, and is
forcing airlines and other players to reconsider how they distribute
travel product. Traditional travel players in Japan have been way too
slow to embrace the Internet. Many still only answer their phones between
nine and five and are closed weekends. The innovative agencies and
intermediaries meet consumer needs for service and information. Online
reservations offer 24-hour service. Consumers who don't get home until 9
PM need that.
There will be extraordinary opportunities in the outbound travel industry
over the next 12 to 18 months. Outbound Japanese travel to Hawaii peaked
at the height of the recession, with 2.2 million visitors in 1997.
Imagine how outbound travel will explode in a recovering economy.
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Trusting in failure
Ever come up with a snappy UBT only to discover shortly thereafter that a
famous person had already published your words?
It happened to me last month. I was reading a book by a Japanese
entrepreneur boasting that, thanks to his contrarian's approach in a
business where competitors streamed lemming-like in the opposite
direction, he "never failed," before, during, or after Japan's notorious
bubble economy.
"I can't trust anyone who says he's never failed," I told the writer in
an imaginary conversation, pleased with my newly-minted UBT. Conveniently,
I refrained from considering that 1) such a hoary chestnut has probably
been published a thousand times in 30 languages over the last century
alone, and 2) the book writer was a wildly successful businessman with
hard-earned bragging rights.
So it was with a mixture of disappointment and pride that I read, in a
recent article by Fast Retailing CEO Yanai Tadashi (he of Uniqlo fame),
my own UBT and our Quote of the Month:
"I don't trust anyone who says he has never failed."
Trust in failure. We might as well; it seems to encompass 97 percent of
the activity upon which success is ultimately built...
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Action plan
Ever wanted to write a business plan, but never found quite the right
opportunity? Learn how while helping an overseas company crack the Big
Mikan: join the Japan Market Entry Competition. Or, if you're a manager
looking for fresh thinking, consider sponsoring a JMEC team. Interested?
Attend an introductory session September 8 or September 16. See details at www.jmec.gr.jp
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Bits and bytes
Mark Devlin, entrepreneur and publisher of Metropolis, an English
language weekly newspaper with an audited circulation of 30,000, will
speak at the next Entrepreneur Association of Tokyo meeting Tuesday
September 7. See for location and details.
Ramsey Clark, former Attorney General of the United States, launched a
highly entrepreneurial government restructuring initiative this summer
with full-page advertisements in media such as the New York Times. So far
he's attracted nearly half a million supporters. For details see
.
Next month JER gets off its travel kick and back into the information
technology world. Stay tuned for the new fall lineup...
Tim Clark
Senior Fellow
SunBridge Corp.
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Copyright 2002-2004 Tim Clark
Reproduction in whole or in part without express written permission is
prohibited, but feel free to pass along or quote with URL
(www.japanentrepreneur.com)
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