Trends in China’s Outbound Market to Japan （Vol.1）

“Mt. Fuji” “Shopping” and “Group Tourist Visa”–these are the 2008’s three symbolic keywords for China’s outbound tourism to Japan.

Although Southeast Asia still remains as China’s primary outbound travel market, Japan was one of the destinations that showed the highest growth rate in 2007, according to the interviews conducted by JTM to major travel companies in China. Currently, most of the sales of China’s travel product featuring Japan are so-called “Golden Route Tours”. Packages usually link Osaka and Tokyo, including visits to Kyoto, Mt. Fuji, Hakone and Tokyo Disneyland. The price range per person stays within 100,000 JPY, which is considered reasonable for Chinese tourists.

“Compared with other destinations in Asia, Japan’s potential is high for repeating visitors”, comments almost every product development staff that JTM interviewed. “Diverse and a good balanced range of travel attractions are the key”, they add, “Such as shopping, hot springs, traditional culture including food, entertainment and landscape”. There is much interest to cultivate new destinations in Japan.

In the meantime, however, the existing requirements to obtain a group tourist visa have been a large obstacle to boost the number of tourists originated in China to Japan. Therefore, further expansion of FITs and diversification of consumers’ preference and distribution channels might still take time.

Still small in number, the repeating Chinese travelers do show a steady growth today, observe tourism experts in China. The largest travel purpose is “Shopping”. From electric appliances to daily supplements, repeating travelers buy a variety of things now in Japan, including designer items, medicine and clothes.

Previously, wealthy Chinese used to choose Hong Kong for shopping travel destination. However, due to widely distributed copied products in Hong Kong they began shifting their shopping destination to Japan. There are three major reasons for wealthy Chinese to select Japan. Wealthy Chinese are: 1. Quality-conscious for originality, high quality and safety, 2: Price-conscious admitting that it is more reasonable to buy luxury brand items in Japan, 3: Brand-conscious to get hard-to-buy products back home. Today, it is not unusual to find wealthy Chinese spending more than 1 million yen during a shopping trip.

Another factor that fuels up shopping trips from China to Japan is the rapid spread of credit card. The number of issued cards in China is estimated to have reached approximately 60 million by the end of 2007. Urban areas like Shanghai and Beijing, in particular, the percentage of credit card holders among young business people employed by big companies and between ages of 20 to early 30s, has continuously been growing. The fact is changing their convenience in shopping overseas.

Now, the question lies what would be the next movements in China’s outbound market segment following the shopping-centered wealthy Chinese?

(To be continued)