Already a Bloomberg.com user?
Sign in with the same account.
By Ian Rowley After trudging through Tokyo Station trying to find his track for what seemed like hours, Allen Doyel knew for sure that he wasn't in Kansas anymore. "Finally, I got on the right train, but got off at the wrong stop and wandered around some more," says the 25-year-old law student from Lawrence, Kan. Lucky for Doyel, the Japanese are nothing if not courteous. "In the end, I pointed at a map and a guy took me four blocks out of his way to help me to the hotel."
With its combination of breathtaking scenery, vibrant cities, great food, and unique culture, Japan should be a top draw for international travelers. But when it comes to tourism, the world's second-largest economy is a notorious underperformer. Japan hosted just 7.3 million visitors last year—and nearly 30% of those went there for business. In fact, the Land of the Rising Sun ranks a lowly No. 30 in terms of visitors globally, says the World Tourism Organization.
Now, Japan faces a golden opportunity to work its way up the league tables. Global interest in all things Japanese has been piqued by sushi, anime, manga comics, and movies such as Sofia Coppola's Lost in Translation and Clint Eastwood's Letters from Iwo Jima. And while the yen has appreciated in recent weeks, it's hovering near a 22-year, inflation-adjusted low against the dollar, while the euro, sterling, and other currencies have been soaring. So for Americans a vacation in Japan can now add up to less than a holiday in Europe. In Tokyo, you can jump on the metro for just a buck, compared with $8 for a rush-hour ride on London's Tube. And a Starbucks tall latte will set you back $3.10, vs. $4.72 in Paris.
Problem is, Japan isn't really profiting from these trends. One reason is historical: With its export-driven economy, the country has never needed to woo visitors as a source of foreign exchange. Tourism accounts for just 2% of gross domestic product in Japan, compared with 11% in Spain. While the number of visitors from other Asian countries has been rising, Americans and Europeans are getting scarcer. That's perhaps in part due to a problem that Doyel faced: The language barrier is close to impenetrable, and many streets in Tokyo don't have signs—even in Japanese, let alone English.FORGETTABLE SLOGANGovernment efforts to promote the country's charms have been halfhearted at best. In 2003, then-Prime Minister Junichiro Koizumi launched a scheme to double tourism to 10 million by 2010. But Japan's $30 million budget last year was less than half what Hawaii alone spent on tourism marketing in 2006. And many critics say the ads are ineffective. Early spots featured Koizumi (would more Americans visit France if President Nicolas Sarkozy asked them to?). And then there's the forgettable slogan: Yokoso! Japan—even though few foreigners know that "Yokoso" means welcome in Japanese. "A catchphrase that targets foreign tourists should be self-explanatory," says Isao Shiozawa, president of Osaka University of Tourism. "Otherwise, it's nonsense."
Japan's big travel companies, meanwhile, are more focused on domestic travelers than international visitors. JTB and HIS, the top two agencies, get less than 2% of their sales from foreigners. Today, there's easier money to be made providing vacations for Japan's baby boomers, who are starting to retire and have cash to spend. "If hotel owners can fill rooms with people that speak the same language and whose tastes they know, there's no need to take on all the extra work finding out what an American or English person likes to eat," says Neil Riley, who runs Japan Worldwide, a travel agency that specializes in ski packages pitched at Westerners.
American visitors seem to be especially tough customers. Their numbers actually fell 1.8%, to 403,300, in the first half of 2007. But those who do make the trip rarely go home dissatisfied. Overnighting at a Buddhist temple, taking in a sumo wrestling match, and a side trip to Kyoto are among Doyel's highlights. If only Japan were better at spreading the word. Says Doyel: "I haven't seen any advertising in the U.S. showing you all the neat stuff here." With Hiroko Tashiro in Tokyo