From on-demand helicopters to private superyachts, the spending power of ultra-rich travelers could be the key to revitalizing regional areas in Japan to give the country a much-needed boost in its post-pandemic economic recovery.
Luxury travelers looking to explore areas beyond the classic tourist destinations of Tokyo, Kyoto and Osaka offer an opportunity for lesser-known destinations to showcase their unique culture, according to those in the industry.
“The most crucial aspect of regional revitalization is figuring out how to effectively encourage (the wealthy) to spend money, and there are only two ways to do that. One is through tourism, and the other is by leveraging each prefecture’s strengths,” said Shintaro Masuda, founder and CEO of Blank Marketing & Management Ltd.
The Mie Prefecture-based venture company is the developer of an app called Airc, which enables on-demand helicopter flights between various locations in Japan, almost like booking an Uber.
Those wanting to skip the Tokyo traffic and get to Mt Fuji in 30 minutes, for example, could open the app and book a private helicopter from Tokyo to Kawaguchiko. The app takes care of all the arrangements, including transfer from the customer’s current location to the heliport.
Blank Marketing & Management is also developing a platform slated for release next summer that will streamline the hassle of sorting out accommodation, booking restaurants and arranging activities through an interactive chat system.
If a user wants to eat sea urchins, for example, the app will be able to identify the best restaurants across the country, devise a route, and even make all the necessary reservations to get to the chosen location, Masuda said.
“Luxury travelers want to see things they can’t usually see or experience. The app will be able to cater to their desire to experience things spontaneously, like when they come across something on social media,” he added.
The Japan National Tourism Organization defines “high-value travelers” as those who spend a total of 1 million yen ($7,000) or more per visit to Japan.
According to a report by the Ministry of Land, Infrastructure, Transport and Tourism, high-value travelers from six countries — the United States, Britain, France, Germany, Australia, and China — in 2019 accounted for only 1 percent of total inbound visitors to Japan but contributed to 11.5 percent of total travel expenditure.
Noting the value of luxury tourism, the Tokyo metropolitan government has been taking part in various trade shows, such as the flagship ILTM Cannes luxury travel event, and collaborating with local businesses to develop content catering to high-end travelers.
In addition to economic benefits, affluent travelers from overseas also “improve the city’s image through their influence, contributing to the growth of visitors,” said Shigeki Yamaguchi, director for city sales at the metropolitan government.
The Japanese government would like to see annual spending by inbound tourists, which dwindled during the COVID-19 pandemic after hitting 4.8 trillion yen in 2019, to reach 5 trillion yen as early as possible, and has put particular focus on attracting high-net-worth visitors.
In line with this goal, the government eased rules for private jet arrivals on June 1, shortening the required period to apply for landing permission in Japan from at least 10 days prior to arrival to three.
The move follows a regulatory overhaul for arrivals into Japan by private boat travel in 2021, which included removing the requirement that super yachts declare their cargo and the number of crew members on board every time they make a port call, enforcing such measures only when they enter into and depart from the country.
SYL Japan Co, which provides concierge services for super yachts docking in Japan, was instrumental in convincing the government to ease regulations by espousing the economic benefits of foreign-flagged yacht visits.
“It is said that when a ship stays for a day, it contributes between $10,000 to $15,000 to the country’s economy. Therefore, it would be ideal if each ship stays as long as possible,” said Kenta Inaba, president of SYL Japan.
Super yachts also offer a way of increasing spending in more rural areas that may lack forms of accommodation such as luxury hotels and other infrastructure for tourists, supporting the government’s goal of increasing the number of high-end travelers in places off the beaten path.
“Money is already flowing quite substantially in cities like Tokyo, Kyoto and Osaka, but it is a challenge to establish a mechanism for ensuring that it is distributed to other areas effectively,” said Inaba.
But ships, which can dock in lesser known destinations without much difficulty, “are a convenient way of attracting visitors to remote islands and border regions,” he added.
In a bid to improve the appeal of Tokyo’s remote islands, the metropolitan government said it has dispatched staff to study and learn from harbor facilities in the Mediterranean, which are popular destinations for super yachts.
The Japan Tourism Agency, meanwhile, has recently selected 11 regional locations to support in developing products and services for the wealthy.
But there are concerns that, while offering exclusive experiences to customers and economic benefits to locals, luxury tourism could also potentially cause environmental degradation, cultural disruption, and the over-commercialization of destinations.
To mitigate these potential side effects, over a dozen Japanese organizations have joined the Global Sustainable Tourism Council, an international body that manages standards for sustainable travel and tourism.
One of its members, tourism consulting company Tricolage Inc, last year supported a project by the tourism agency, also a member, to develop a sustainable accommodation plan at a luxury forest resort in Yamanashi Prefecture.
“Developing a comprehensive travel experience with local participation in this way can sublimate the experience into a customer experience with added value that is unique to the region,” the company said in a news release after the project was launched.