20-year low in Japanese visitors seen
Fewer flights and hotel rooms, rising fuel surcharges, generational and economic changes contribute
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Hawaii's struggling Japanese visitor market is likely to reach its lowest point in nearly 20 years this year, officials forecast.
Fewer flights and hotel rooms, rising fuel surcharges and other costs as well as generational and economic changes in the market have all been blamed for the downward trajectory, which could decrease the visitor count to around 1.2 million. That is a million-visitor reduction or a 45 percent drop from 1997, the market's peak year.
But increasingly, Japanese visitors -- who spend more here per visit and per day than those from any other nation -- are reporting dissatisfaction with their experience in Hawaii and saying they want to visit other destinations that they perceive will give them greater yield for their yen.
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Top Hawaii tourism officials forecast yesterday that Hawaii's struggling Japanese market is likely to hit a nearly two-decade low in 2008.
Japanese arrivals are projected to dip to around 1.2 million for 2008, a roughly 11 percent drop from the approximately 1.3 million or so arrivals expected to be recorded for 2007, said David Uchiyama, director of marketing for the Hawaii Tourism Authority.
"Hopefully we'll be flat, but I think we'll end up somewhere in the 1.2 million range," Uchiyama told attendees at Hawaii Tourism Japan's annual meeting.
Japan remains the country of origin for Hawaii's highest-spending tourists and the state's No. 2 visitor market.
But the projected dip represents a 45.9 percent decrease from the peak 2.2 million Japan visitors that Hawaii saw in 1997. Hawaii's Japanese market could end 2008 down about 1 million visitors from its peak year.
"It is a big issue for Hawaii how to secure visitors from Japan," said Seiji Naya, University of Hawaii honorary professor and senior special adviser, in a lecture published by the East-West Center last spring and circulated throughout the market.
Rising fuel surcharges, fewer flights and hotel rooms have all been blamed for the downward trends. Hawaii's visitor industry will start 2008 having to surmount a $1,000 fuel surcharge per family of four and a 10 percent reduction in flights.
Generational and economic trends in Japan have also been cited as factors for the continued decline, as has the emergence of new destinations.
However, low visitor satisfaction is a primary reason that Japanese visitors are choosing to spend their time and money in other destinations, and that is an issue Hawaii must address, said Hawaii Tourism Japan Executive Director Takashi Ichikura.
"We are seeing huge gaps in post-arrival satisfaction levels from the Japanese according to DBEDT's 2007 Visitor Satisfaction report," Ichikura said, adding that there is a significant difference in satisfaction levels between visitors from Japan and those from other markets.
In the latest satisfaction survey, only 50 percent of Japanese visitors were satisfied with their trip to Hawaii, he said. And, more than 70 percent of those who said that they were not likely to revisit Hawaii would prefer to go somewhere else, Ichikura said.
"The Japanese are not very satisfied with their Hawaii experiences," he said. "At HTJ we are very concerned about this, and we urge our partners' public relations and sales people to review your products and services to see if you are meeting Japanese expectations."
As such, HTJ's 2008 marketing campaign, "Feel Hawaii with your body and soul, so much more Hawaii," seeks to communicate that Hawaii offers value for the price that customers pay. The campaign spotlights eight different facets of a trip to Hawaii, ranging from adventure, culture, aloha spirit, sports, romance/wedding to relaxation and history, so that Japan's broad visitor mix will see that the islands offer something for all ages.
HTJ also has made drastic changes to its Web site and explored partnerships with companies such as Japanese cellular phone provider NTT DoCoMo, which can offer new advertising formats such as streaming ads to cell phones.
"We can't let fuel surcharges and competition from other destinations get in the way of our most important message, which is that Hawaii is the perfect destination for Japanese visitors of all ages and classes," said Dave Erdman, president and chief executive officer of PacRim Marketing Group.
A bright spot in the Japanese market has been the continued increase in expenditures, which were up through November. However, increased cost without improved delivery in Hawaii will result in deficits, Ichikura said.
According to the latest visitor satisfaction study, 17.3 percent more Japanese visitors said that the trip's value did not meet their expectations, he said. As a result, some segments of the market have suffered, Ichikura said.
"Due to rising costs, unfortunately many wedding couples have shifted toward traveling to cheaper destinations like Okinawa and Southeast Asia," he said.
In the future, the cost-and-value equation will become even more important as the gap between the rich and poor in Japan continues to widen, Ichikura said. Japan's younger generation will have less disposable income for overseas trips, he said.
"In order to stop the decline in the number of Japanese visitors, Hawaii tourism industry must work harder now," Naya said.
