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Japan Market Profile

Though one of Visit California’s oldest markets, Japanese travelers are largely focused inward on rediscovering their own country thanks to improved tourism product and infrastructure in preparation for the Tokyo 2020 Olympics. Still, all of the country’s largest 25 tour operators carry significantly more influence given the language barrier, and all package and sell California.


MAJOR TAKEAWAYS

  • Outbound travel has grown with cheaper tour package prices, eliminated fuel surcharges and a stronger yen
  • Solitary travel is a rising trend, especially among men and women over 60
  • Once-in-a-lifetime and luxury experiences are gaining popularity among travelers over 50
     

     
  • Japanese continue to seek locations offering magnificent scenic views, or zekkei
  • Healthy, wealthy elder members of the population are eager to relive their youth
  • Women in their 20s are the largest segment of female travelers, trendsetting in their choice of travel destinations and travel styles
 

Japan Profile

559,000
In Person Trips, 2017
$1.196 Billion
Visitor Spending, 2017

Market Conditions

GDP Annual Growth Rate

GDP Annual Growth Rate is estimated to grow 1.7 percent in 2017 and continue at a similar level in 2018. In the long term, the GDP Annual Growth Rate in Japan is projected to trend around 1.7 percent through 2020.

Exchange Rate

  • 1 Japanese Yen Equals 0.0088 U.S. Dollar
  • The government favors a weaker Japanese yen to encourage exports and improve profits at major corporations.
  • The yen is seen as a safe haven currency for traders around the world and strengthened periodically during 2017 as a result of tensions and uncertainties in North Asia.
  • The yen traded in the 110-112 yen range for the majority of 2017.

Travel & Planning Methodologies

AIRLIFT

  • 117 weekly nonstop flights
  • 29,319 weekly nonstop seats
  • Nonstop flights from six airlines to four gateway cities: San Francisco, Los Angeles, San Diego and San Jose
  • ANA added a third daily Tokyo to Los Angeles flight in October 2017.

BOOKING

  • Planning time frame: 2-6 months
  • Booking time frame: 1-3 months
  • 30 percent book package or group tours; the remaining 70 percent arrange air/hotel via retail travel agencies, online travel agencies and directly with airlines
  • All of the largest 25 tour operators package California; strong growth in escorted group tours for seniors showcasing California’s natural beauty
     

Market Barriers & Risk Factors


Competitive Landscape


Other Market Insights

MARKET

  • Outbound travel has grown.
    • Outbound travel was up 5.6 percent in 2016 and continues up 5 percent in 2017. Almost one million more Japanese traveled abroad in 2016 than in 2015.

PRODUCT EXPERIENCE

  • Majority of Japanese desire international travel.
    • 56 percent of Japanese indicate a desire to travel overseas.
  • Young women are back.
    • Travel by young women in their teens and twenties was up 13 percent in 2016 and continues strong in 2017.
    • Women are once again setting trends driven by a desire to find products, foods and experiences unique to the destination.
  • Solitary travel is firmly established.
    • Solitary travel is popular among all ages, but especially among men and women over 60 who are happy to travel even without a companion.
    • People traveling alone account for 20 percent of the total market.
  • Once-in-a-lifetime and luxury experiences are growing.
    • Once-in-a-lifetime trips and luxury travel experiences are gaining popularity among travelers over 50 and Japan’s fast-growing high-net-worth segment, which is up 56 percent since 2010.
  • Visually dramatic views are a travel motivator.
    • Japanese of all ages are continuing to seek locations offering magnificent scenic views or zekkei.
    • Interest in traveling for “Instagram-worthy” views/ shots, especially among young women, is driving creation of new products.
  • There is continued passion for varied and rich culinary experiences, shopping and historic/cultural attractions.

AUDIENCE

  • Older members of the population are eager to relive their youth.
    • 33 million Japanese are over 65 and now outnumber those aged 14 or younger by two to one.
    • Seniors are healthy, wealthy and increasingly eager to relive their youth, including taking part in activities such as surfing, biking, hiking and motorcycle riding.
  • Women in their 20s are the largest segment of female travelers.
    • Women in their 20s accounted for 1.74 million outbound travelers in 2016; while this segment is only half the size of its peak in the 1990s, it remains the largest market segment among women travelers.
    • Young women continue to be trendsetters in their choice of travel destinations and travel styles.

 


Sources

  • International Monetary Fund
  • Tradingeconomics.com
  • Cabinet Office, Japan
  • xe.com
  • DIIO
  • U.S. Department of Commerce
  • Tourism Economics
  • CIC Research, Inc.
  • JTB Report on Overseas Travel 2017
  • Japan National Tourism Organization

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