As Japan gears up for inbound growth – 40m visitors by 2020 – one growing concern is the maintaining of “chowa” (harmony) between tourists and residents as a previously-closed country opens its doors wide to tourism.
After all, across the globe, there is a trend of destinations fighting back against tourism which they say is overwhelming their cities and resources.
- Barcelona is introducing a new law, known as the special urban plan for tourist accommodation, which seeks to limit the number of beds on offer from hotels and tourist apartments. Last year the city’s 1.6 million residents were outnumbered by an estimated 32 million visitors, about half of them day-trippers.
- Iceland’s tourist boom has brought increased wealth to the economy but has placed a strain on a country full of natural resources and a population of just 332,000. In 2016, the amount of tourists from the USA alone was more than the local population with the expected total number of Iceland tourist numbers in 2017 expected to reach 2.3 million.
- Amsterdam, a city of almost 850,000 inhabitants, had 17 million visitors in 2016, up from 12 million five years earlier. It is said the number of visitors could hit 30 million by 2025.
- A new law was passed in February in Singapore which makes it illegal for home owners to rent out entire apartments and rooms for less than six months, unless they have permission from the Urban Redevelopment Authority (URA) to do so. This is a country of 5.3m population, with 16.4m tourists in 2016.
On the day WIT Japan & North Asia was held, the Japanese government enacted a bill to fully allow the operations of “minpaku” private lodging services across Japan. The government hopes to implement the law in January 2018.
Passing of new bill paves way for foreign brands to scale
The bill, clearly aimed at addressing a looming accommodation shortage ahead of the Rugby World Cup in 2019 and Olympics 2020, paves the way for the scaling up of global brands such as Airbnb and HomeAway. Chinese vacations rental unicorn, Tujia, has set up a Japanese subsidiary and has partnered with Relux, the high-end accommodation site recently acquired by KDDI.
For these brands, Japan is their fastest-growing market as it is also for Booking.com which is making a strong play in private accommodation with 650,000 of its 1.2m listings globally listed in this category.
At WIT, Ken Mishima, vice president, ecommerce strategy for i.JTB, said that according to JTB’s own research, there were 700m room nights available in B&B private accommodation. “The international OTAs have captured the market and we have to do more.”
Discussing private accommodation the day the Japanese enacted a bill to fully allow the operations of “minpaku” private lodging services across Japan, from left, Shinichi Tatebayashi, SQUEEZE; Kei Shibata, Venture Republic; Tom Nagata, Airbnb Japan; and Maggie Rauch, Phocuswright.
Sharing data he had prepared for the private accommodation panel at WIT Japan, Kei Shibata, CEO of Venture Republic, whose metasearch site, travel.jp, is the first to partner with Airbnb in Japan, said that Airbnb had generated bookings for 3.7 million tourists in 2016. “That means they have already gained 13.5% of market share in inbound accommodation bookings in 2016. It’s grown more than 2x. Tokyo is now within the top five cities in the world for Airbnb.
“Airbnb alone has already listed 48,000 properties only for Japan. (vs 32,000 listings for all the domestic hotels combined on travel.jp).”
Sharing travel.jp’s actual data from its distribution partnership with Airbnb, Shibata said that on the domestic front, the unit price of bookings in recent month is around US$110. “Tokyo (including Chiba/Tokyo Disney Parks), Hokkaido, Osaka (including Universal Studio Japan), Sapporo and Okinawa are the top 5 searched destinations. Outbound, unit price of bookings in recent month is around US$230. Hawaii, New York, Paris, London, San Francisco and Seoul are among the top 10 searched destinations.
He said that private accommodation is a great fit with Asia for two reasons – Asians tend to travel more with families and groups and a decreasing and aging population is happening in countries like Japan, China and South Korea. “As a result, Japan alone is having 82 million homes which is 13.5% of entire number of housings empty now. How do we want to use this capacity? Use it for Inbound tourism.”
The growing market has given rise to models such as Squeeze, which helps hosts “maximise revenues while minimising resources for the existing operation”, said Shinichi Tatebayashi of SQUEEZE, who spoke at WIT. SQUEEZE’s aim is to “resolve empty room problems in Japan and rediscover and utilise hidden but talented human resources in local communities”.
Need to disperse tourism to other regions
One key benefit of the new bill is clearly the potential dispersal of tourism beyond the main destinations and spread tourism benefits to other regions of Japan.
Yumiko Toeda, Revic: Japanese hotels need to invest in talent to cater to a new generation of travellers.
At WIT, Yumiko Toeda, senior director of the Tourism Revitalisation Mother Fund at Revic, welcomed the move, saying there was a need to take pressure off the most-visited places.
The former CEO of Granvista Hotels & Resorts, who now runs the fund that’s aimed at revitalising less developed regions of the country through strategic investments, said models such as Airbnb were meeting a need of today’s consumers. She said that it was necessary for hotels in Japan to invest in developing talent to cater to a changing generation of travellers, as they fan out across the country.
HomeAway, for instance, has tied up with the region of Setouchi to list historic properties in the area and has launched a marketing campaign across Asia, with a strong social component via the #gethomeawayinsetouchi hashtag and a microsite promoting the region and the properties,” according to Tnooz.
“Social media sending people to the same places”
During the panel on “How to maintain ‘chowa’ (harmony) in destinations”, panelists Ashley Harvey, Associate Officer, CJTPA (Central Japan DMO); Teddy Lee, CEO, Rose Hotel Yokohama; Aya Aso, Founder & ex-CEO, AGORA Hospitalities and Hidemi Hasegawa, Kaikake Onsen, agreed the problem wasn’t that acute yet in Japan but there was definitely a need to disperse tourism beyond the main areas and to anticipate issues that could arise.
They were asked to choose their top concern as most likely to impact “chowa” from this list – the sharing economy, growing volumes of Chinese tourists, lack of respect for traditions and cultures and social media sending everyone to the same places.
Aso said her concern was that social media was sending tourists to the same places, sharing an anecdote of how “Slam Dunk”, a manga movie brought loads of Taiwanese travellers to Kamakura and “locals didn’t know what was happening but suddenly their town was full of tourists looking for this railway station”.
The “Slam Dunk” manga movie which sent Taiwanese travellers to look for the same spot in Kamakura.
Harvey said regional destinations had to step up their marketing and better use digital channels to promote attractions beyond the obvious to broaden tourists’ perceptions and help with the dispersal.
He also said that ryokans had to be more flexible to accommodate foreign travellers’ schedules and not to have too rigid dining schedules for instance.
“This strict adherence to dining times can be difficult for independent travellers who like flexibility,” said Harvey.
To which Hasegawa, the okami of her family-owned Kaikake Onsen ryokan, said that foreign travellers should respect Japanese traditions “and do what the Japanese do”. Situated in Yuzawa in the Niigata region, her ryokan is located within the Kagura Ski Resort – during the peak winter months, she gets about 50% foreign guests.
Lee, whose town is known for its huge Chinatown, said Yokohama was not being overwhelmed by Chinese tourists. “In fact, we want more. Come,” he said.
One advantage of tourism to smaller towns is keeping certain traditions alive such as “shimasen” (Japanese guitar) and “geisha” performances.
Most of these traditions are dying out, said Aso, because young Japanese were not appreciating them as much. “Teddy (Lee) and I make it a point every new year’s eve to go to such a traditional establishment and support them. I think tourists, if they know about these places and respect their ways, would be a good way of keeping these arts alive.”
In the opening session, Peach’s CEO, Shinichi Inoue, when asked what his airline could do to educate travellers on how to behave in Japan – 70% of the airline’s business comes from inbound – said, “There’s no need to educate them. They educate themselves on social media, they share with friends on what to do and what not to do.”
When the panel was asked what destinations they felt did a good job of preserving “chowa”, Harvey picked Venice “because it seems in the evenings when everyone has left, you have the whole city to yourself and that seems a good balance”.
Lee picked Salzburg in Austria and both Aso and Hasegawa picked Italy for its ability to disperse tourism and have a diversity of experiences between urban and rural. And yes, when in Rome, do what the Romans do.
Discussing how to maintain “chowa” in Japan as inbound increases, from left, Teddy Lee, Rose Hotel Yokohama;; Ashley Harvey, CJTPA (Central Japan DMO); Aya Aso and Hidemi Hasegawa, Kaikake Onsen
