TT-832 (Tourism Edition) -- Why Niseko is a Model for Other Tourism

* * * * * * * * 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.
(http://www.terrielloyd.com)

Tourism Sector Edition Sunday, Dec 13, 2015, Issue No. 832

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+++ Why Niseko is a Model for Other Tourism Developments

The UK's second largest daily newspaper, the Daily Mail, ran an
enthusiastic travel article on its December 12th web page about the
virtues of skiing at Niseko, in Hokkaido. The journalist, Ted Thornhill,
obviously had such a good time skiing there that he commented on the
quality of the powder no less than eight times. Other adjectives he
used, in good British daily news tradition, were "magnificent",
"amazing", "striking", "eye-popping", "eye-catching", and even
"ridiculous" (used in the positive UK way)... well you do get the
feeling that Mr. Thornhill enjoyed his trip.

Hopefully that means some of the Daily Mail's almost 4m readers will be
prompted to explore more online about Hokkaido powder over the next few
weeks and eventually make their way there.

You can read his article in all its tabloid glory here:

http://dailym.ai/1Y6SFz4

It's not news that foreign journalists are writing nice things about
Japanese locations. Although it is highly possible that his trip was
paid for by the tourism authorities here in Japan -- something that
isn't unusual because other countries do the same. Rather, what caught
our attention about this story is the way that Mr. Thornhill wrote it so
that his readers could relate to Niseko without knowing the place, by
referencing the things that mattered to him (and thus presumably to his
readers as well).

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Tabloids around the world survive by understanding their readers
intimately and entertaining them. The Daily Mail's readership is largely
middle class and more than 50% female. This means many of them probably
either already ski in France, or have friends who do, and they do like
their comforts while on holiday. Mr. Thornhill surely knows this, and so
he writes with frequent reference to familiar locations like the Espace
Killy region in France, and how although the number of runs in Niseko
are limited they are none-the-less comparable.

It's no accident Thornhill chose this French region as his reference
point, because the area was ranked in 2012 as one of the top three ski
destinations for Britons by www.skiclub.co.uk. The Ski Club is Britain's
largest ski organization, with about 29,000 members, and its site is
somewhat of a skiers' bible which provides copious information about
skiing destinations around the world. Interestingly, it currently ranks
Niseko as a 4-star location, the same as the Tignes area that Thornhill
was comparing it to. So, in this regard, even though his sponsors may
not realize it, Thornhill is doing Niseko a huge favor by making the
comparison.

Just as important are his many references (and some great photos) to the
upmarket accommodation he used, as well as the food and nightlife in
Niseko and nearby Hirafu. Although I'm not sure whether he thought it
was a good thing, he mentions several times how popular both locations
are with the Australians -- which at least reassures readers in the UK
that the place can't be too alien if Aussies are enjoying it. After all,
they know how to have a good time... :-)

This one article could be turned into a marketing lesson for Japanese
tourism authorities, because it shows very clearly the hot buttons an
experienced opinion-leader (in this case, a tabloid journalist) presses
to engage his audience. These hot buttons will of course be different
for each culture and society, but to win in the global market the trick
for Japan is to understand that there are also some constants -- such as
visual wow factor, actual quality of the activity (skiing), convenience,
and creature comforts.

An important lesson for the Japan Tourism Agency, and the bureaucrats
who control its budget, is that making world-class ski resorts is not
achieved by slapping some paint on decrepit buildings of the type you
usually find in Japan's ramshackle ski towns and resorts, and making a
pretty brochure. Instead, you need serious investment in facilities and
a policy to beautify the entire area. It beats us why the government,
with its huge budgets for subsidies to soon-to-be-obsolete rice farmers
and concrete ugliness along the nation's coastline, can't figure that out.

In Italy some 20 years ago, the country decided to prioritize
agritourism by helping those farmers wanting to attract more guests by
making property improvements, by providing easy loans and tax benefits.
As a result, Italy now has about 7% of its inbound tourists staying at
farms, allowing farmers to stay on their land and for their families to
have decent lives. Japan could do the same if it wanted, instead of just
dumping short-term subsidy money into their bank accounts. We referred
to this back in August 2014 in Terrie's Take 769.

http://bit.ly/1SVzkKJ

Using Niseko as a role model, apart from the fact that the location
received substantial amounts of investment, another key factor in its
success was that the development was mostly led by a group of foreigners
(Australians) rather than local Japanese. This foreign vision of
creating a little ski utopia in Japan was critical in creating
facilities which are today world-class and yet still accessible to small
investors, and where the original planners are still involved. Usually
resort developers are white-shirted beancounters based in Tokyo, so the
resulting facilities are either gutted by cost-cutting measures, or
garish monstrosities. So our advice is to get some professionally-minded
foreign investors in on each project at the start -- people who want to
keep using the place long after it's developed and who will therefore
try harder to make the result work.

Going back to the lessons to be drawn from this article, as the Japanese
government considers how to attract tourists to other locations around
the country, they need to understand that citizens other than the
newly-rich of China will come to Japan IF they can have a world-class
experience. People will enjoy the exotic nature of Japan so long as they
can also be pampered by all senses, not just by mouth. This means going
beyond food, and making the destinations aesthetically (or dramatically)
pleasing, properly upgrading them for convenience with technology, and
pitching them as social melting pots (language, facilities, access,
etc.) so as to attract other internationalized guests that foreign
visitors can socialize with. I realize this last point could be
difficult in resorts that have entrenched old-fashioned Japanese
oji-sans running them.

Niseko manages to do all of the above because it was almost a greenfield
project, and some of the original builders and their friends continue to
invest and use the place. This could be a blueprint for locations
stretching from the languishing ski fields of Honshu all the way down to
the islands of Okinawa. How this philosophy could be encapsulated in
government legislation and policy could be the subject of another
Terrie's Take, but certainly they could start with tax exemptions
(especially inheritance tax) and visa preferences for foreigners
building second homes in designated resort locations in Japan.

Another more challenging but even more interesting stimulus would be for
the government to designate certain Japanese banks to work closely with
foreign banks (who have foreign customer data) to offer foreign
investors low-interest home loans on 30%-down mortgages for resort
properties. Such a program would likely kick off a land rush in
currently-depressed resort areas all over the country, and contribute
magnificently to the government's inflation goals.

************
This is my last Terrie's Take of this year (although I will put out a
short Christmas notice next week). I will be back on deck with the New
Year's edition on January 10th, 2016. In the meantime, I wish everyone,
irrespective of their religion, a Merry Christmas and a Happy New Year.
Thank you so much for reading the Take. I sincerely appreciate it.

...The information janitors/

-----------------------------------------------------------

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***********************************************************

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