Japan Travel

* * * * * * * * TERRIE’S (TOURISM) TAKE – BY TERRIE LLOYD * * * * * *
A bi-weekly focused look at the tourism sector in Japan, by Terrie
Lloyd, a long-term technology and media entrepreneur living in Japan.

Tourism Sector Edition Sunday, Aug 12, 2018, Issue No. 957

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+++ Why Taiwanese Bicycle Maker Giant is Cleaning Up in the Japanese Market

I’ve always found it strange that in a country which has fought for
global market share in almost every manufactured product segment, Japan
has happily ceded its market presence in the bicycle business to other
Asian economies, most notably Taiwan and China. This is not to say that
Japan has no bicycle manufacturers, but those that have survived are
either trying to become “two-wheeled electric car” makers or are simply
focusing on bike parts (e.g, Shimano and their bicycle groupsets).

In 2017, the top three exporters of bicycles in the world were: China,
with sales of US$3.1bn (35.2% market share), Taiwan with US$1.3bn
(15.1%), and the Netherlands with US$807.6m (9%). Japan was number 22,
with sales of just US$45.4m, giving it a meager 0.5% global market
share. Compared to the completed-bicycle manufacturing sector, though,
Shimano is a noteworthy exception. Their 2017 net sales of gear shifting
and other bicycle mechanisms, most of which were exports, was US$2.4bn –
not a bad effort for a parts company.

The completed-bicycle sector’s puny standing wasn’t always so and in
fact in the late 1800’s, Japan was already proving its manufacturing
prowess overseas. A Chicago Tribune 1895 article stated, “Japan seems to
be the ideal land in which to purchase bicycles – good wheels are sold
over there, and at wholesale at $12 each.” This at a time when U.S.
bicycles cost around $50.

Unfortunately those early Japanese manufacturers never made it to the
USA or other markets, mainly because at the turn of the 19th century the
domestic market was rapidly industrializing and families could afford to
buy durable products. Bicycle usage thus boomed in the domestic market,
and of course they were made to fit the population. The first few
attempts at export found very few takers other than children, because
the bike frames were simply too small. Later, after the War and
automobile manufacturing had caught on, bicycles became considered a
poor person’s vehicle – meaning that most of the local manufacturers
lost interest in making them. Today only Panasonic, Yamaha, and
Bridgestone have any real presence in the market, and most of their
output revolves around high-end electric bikes.

So you’d think that the bicycle business is dead in Japan, but not so.
Instead of the local players making good here, it has taken a Taiwanese
firm, the world’s largest bicycle manufacturer, Giant, to show the
locals how to revitalize the market. And the way they are doing it is
really interesting.

[Continued below…]

——— Japan Travel Corporate Travel Services ———-

Japan Travel’s Type-2 licensed travel agency business is one Japan’s few
independent foreign-owned inbound DMCs. One of our specialties is
looking after corporate groups of 10-300 people. To date we have
assisted in the successful holding of training events, incentive travel,
conferences, off-sites, and team bonding programs. We have looked after
the full gamut of services, such as: international air travel, hotels,
local travel, event logistics and venues, entertainment,
micro-management of dietary needs, and special needs customers.

We are highly motivated and are happy to work in a variety of roles
tailored to suit your needs: as a full-fledged corporate travel agency
partner, as a logistics partner for a particular issue, or as a source
of innovative experiences and venues. Looking after hard-to-please
high-tech groups is our specialty!

For corporate travel assistance, contact us at: tours@japantravel.com.
Or visit our pages at: http://japantravel.co.jp/en/about/travel-agency/

[…Article continues]

Whereas over the 50 years since WWII the bicycle sector has been driven
by children and teens (and the families buying for them), in the last 20
years, the growth has come from adult health and fitness, and more
recently from adventure seekers. The health and fitness aspect has been
the engine for the exponential growth of road bikes, and can be easily
traced to baby boomers who have become commercially successful and who
have wanted to recapture some of the experiences of their youth. This
has been a fortuitous trend for Shimano, the parts maker, which
specializes in supplying high-end road bike manufacturers. It has also
been the main growth engine for Giant in Taiwan.

With the advent of carbon bikes and lightweight aluminum frames,
technology and performance as consumer considerations have also come to
the fore, and this has stimulated an even newer segment in the market,
which comprises young (mostly guy) riders looking for mountain and trail
bikes to use on rugged, risky downhill courses. In between these two
extremes (of road and trail), you have several other categories of
bicycles known as cross bikes and gravel bikes. And then of course there
are electrics for those baby boomers who “boomed” a bit too much.

These segments have created hundreds of thousands of financially
well-off adult consumers wanting not only high-end bicycles but also
high-end experiences to go with them. Giant has intelligently plugged
into this segment’s psyche, introducing new hybrid bikes every year (to
get the upgrade cycle going) and creating tours and support in iconic
locations around the world where their customers can enjoy their own
personal adventures. As you would expect, Giant has placed its first
bets locally in Taiwan, but thereafter it has focused on Japan, where it
now has 33 stores – more than Y’s Road, the largest Japanese road bike
specialty chain.

And not just stores. If you review where the company is placing their
outlets, they are mostly focused outside the major urban centers (with
the exception of Tokyo) and instead are situated along popular riding
courses around the country. For example, there are two stores at either
end of Japan’s No. 1 cycling route, the Shimanami Kaido, and another
store in the middle of nowhere to service riders circumnavigating Lake
Biwa in Shiga (just northeast of Kyoto). Actually, I’ve been to that
store to help a friend fix a broken shifter cable during a 550km tour we
did in March this year – it’s very well stocked and with a knowledgeable
mechanic. There is even a Giant store in Nogata, Kyushu, a
“least-famous” mining town in Fukuoka-ken that has one redeeming factor
– it connects riders to Fukuoka.

[Continued below…]

———– Access Your Own Personal Tea Master ———–

Tyas Sosen is a Belgian born Japanese tea professional. As a certified
Nihoncha Instructor, and accredited Tea Ceremony Instructor, he devotes
his life to maintaining the authentic Japanese tradition of tea, while
making its beauty accessible to the world. Through his latest project –
a Kickstarter campaign for the only dedicated artisan Japanese tea
subscription, entitled [The Tea Crane – Your Personal Artisan Japanese
Tea Sommelier] – Sosen aims to bring awareness to the deeper joys that
authentic craft-teas can provide, and to shed light on the struggles of
artisan producers.

Contemporary industrial tea manufacturing mainly relies on artificial
methods. The industry uses mass-production and exploitation for the sake
of capitalization and monopolization. Sosen favors the natural variation
of tea, which offers a greater diversity of authentic teas that improve
our health, and quality of life, which is why he wishes to acknowledge,
honor and support small, independent, local Japanese-tea farmers.

To join in on Sosen’s Kickstarter campaign: http://bit.ly/TTCSJP2018

[…Article continues]

There are of course no official numbers as to how many people take
Giant’s Japan tours or do their own trips on Giant bicycles, but I was
told several months ago that the company was responsible directly and
indirectly for more than 10,000 foreign tourist-cyclists riding in
Japan, in particular the Shimanami Kaido route between Shikoku and
Honshu. If this number is true, it makes Giant the LARGEST cycling tours
operator in Japan by a factor of 10, which is pretty impressive.

When I think about Giant’s ability to read and develop Japan as an
adventure destination, I feel both excitement and frustration.
Excitement because with its amazing network of paved roads and an aging
society reducing the number of drivers, Japan has huge potential to
become an international cycling mecca (with convenience stores every
10~20km for water and snacks). Frustration because this is a sector that
Japanese firms should be leading the way in – if only they could get
their noses out of their manufacturing boxes and think about what makes
consumers buy their products.

Indeed, tourists are the ideal target for these manufacturers to
lend/hire their products out to, as Giant does with its national bicycle
rental business, because if a customer uses your product and falls in
love with it, chances are they’ll to on to buy one to take home with
them. Duh…?!!! I tried several years ago to point out this logic to
the nation’s top camera manufacturers, visiting them one by one. To a
company they told me to “get lost”. They make products not running an
activities business, so why should they be interested in renting them out?

Yeah, and so foreign companies like Giant have excellent prospects in
Japan, both because of the huge number of tourists looking for new
adventures, and because their competitors are too blinkered to make the
marketing-sales connection. Also, because of the historical factors in
any case there is no domestic cycling industry to protect, so there are
very few rules to hobble creativity.


Lastly, we are taking off next week for the annual Obon Holiday (which
starts tomorrow). We will be back with our next Take on August 26th.

…The information janitors/


— Japantravel.bike fully operational – rent one today —

The www.japantravel.bike One-Day Rental Cycle Pass service is now
offered on more than 6,000 power-assisted bicycles all over Tokyo, and
500 in Osaka and Nara. The service is developed on top of the DOCOMO
BIKESHARE bicycle rental platform, and offers an updated smartphone
interface, which provides international tourists easy access, a fast
payment system, and multilingual customer support. Passes start at a
flat rate of JPY 1,500 plus consumption tax for a basic rental at the
bike port (more for pre-bookings), and renters can use the bicycle or
any replacement, for up to 24 hours (from 00:01 to 23:59 each day). 580+
bicycle ports across the three cities allow convenient rental and return
to any port within the area.

JapanTravel.Bike is coming soon to other major cities in Japan.

To rent one: www.japantravel.bike


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Written by: Terrie Lloyd (terrie.lloyd@japaninc.com)

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