Terrie's Take 951 (Tourism Edition) - Japan Travel -- Several Pivots Later and Many Lessons Learned
terrie at mailman.japaninc.com
Sun Jul 1 23:27:56 JST 2018
* * * * * * * * 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, July 01, 2018, Issue No. 951
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+++ Japan Travel -- Several Pivots Later and Many Lessons Learned
Some thoughts in today's Take about pivoting and how to survive the
process. In Japan Travel's case, even the original business itself was a
The www.japantravel.com website and Japan Travel KK company were both
started in December, 2013, but the idea and test version of the site
came in mid-2011, shortly after the devastating 3/11 Tohoku earthquake.
Some readers will recall our test site going by the URL
www.japantourist.jp. The central idea behind it was that we as a group
of long-term resident foreigners in Japan, wanted to do something to
help the country after the Fukushima nuclear accident (which scared away
more than 500,000 foreign residents). It wasn't just about reassuring
those who had fled that most of the country was still perfectly safe,
but also to reach out to first-time visitors and let them know that,
yes, Fukushima was bad, but pretty much everywhere else was
radiation-free. We used to take scintillator readings every morning, and
compare the background radiation levels in Tokyo with those in Hong
Kong. (Hint: HK's levels were higher.)
http://bit.ly/2yZr6SH [SCMP:: Safecast.org says HK radiation levels
higher than Tokyo.]
Like many others in the original www.japantourist.jp community, the
nuclear accident affected me personally by creating a perfect storm for
my then-paper publishing business - whereby almost all my readers and
sponsors left the country in one massive wave. For many of my best
customers, expat families and those in the financial sector, the
departure was permanent, as Singapore and Hong Kong happily gave them
and their companies alternative residence.
In the business vacuum that followed, I realized that for the first time
in a long time I was being gifted with one of those life-changing
opportunities to choose my future path - a personal pivot. My decision
was to take a stand and stay in Japan, but to create a new business
model (crowdsourcing) that would promote Japan and its merits, and most
importantly, in a way that I could work with the many others who thought
like me and who wanted to make our combined voices heard.
Thus was borne the idea of a crowd-sourced user generated content (UGC)
site that served as a deep travel Wiki for foreigners thinking of coming
to Japan. Our first site, www.japantourist.jp, was launched in November
2011 with a press conference that drew a rather modest audience of just
2 magazines and 3 online sites. Despite the lack of media interest, the
timing for www.japantourist.jp as a unified passion-driven community was
perfect, and in the following 2 years we grew to a community of
thousands, with our multilingual contributors producing hundreds of
articles and photo stories a month.
In fact, things were going so well that by the end of 2013, with the
concurrent change of government and PM Abe's measures to mend the
economy by forcing down the yen and opening up visa issuances to Chinese
nationals, it was obvious that we should incorporate and turn the travel
community experiment into an actual company. We took many risks
monkeying with the business at that point - changing the company name,
changing the domain name and in the process killing off our existing
brandname recognition, and completely rebuilding the technology platform
to be more scalable and flexible. For myself, this was the peak of the
start-up experience and I became more convinced than ever that we really
could become THE leading inbound travel media site for Japan.
But fate had some diversions in store first...
As we quickly found out, there is a huge gap between an online social
effort that we all believed in, and actually building a company that
could earn enough revenue to pay people's salaries. Mid-2014 brought
with it some serious decisions to be made about budget, hiring staff,
filling roles that would make the business work (sales staff, engineers,
managers, etc.), and I took a step out over a mental abyss, committing
funds from friends and family to make it happen. Our business model at
the time was pretty simple: get lots of page views, sell lots of
advertising, and keep growing.
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By late that year, however, it was obvious that although the platform
and the site were performing, the business itself wasn't getting the
revenue we expected. We were learning the hard way that although inbound
travel was indeed a hot business sector, most companies already in
travel were busy and the last thing they needed was ads. On the other
hand, the many peripheral companies looking on with envy were being
extremely cautious about joining the party, not least of which because
they were language-challenged, were bereft of business planners and
managers who understood the needs of foreign travelers, and because they
didn't have the marketing clout to compete with the global travel
brands. Think of the Expedia's, the Trip Advisors, and such like.
We were of course aware of the competitive threat of the big foreign
online brands when we first started out. Our solution was to offer
significantly deeper and more complete local information - thanks to our
nationwide resident community - and attract users looking beyond the
usual attractions. Indeed, that audience did find us and today we
receive more than a million unique visitors a month on our various
media. But back then, even with a strong web site, we were caught in a
fledgling market where the biggest potential sponsors were themselves
neophytes. Not a situation conducive to financial security..!.
Another thing we didn't count on was the reluctance of the local online
travel firms to enter the inbound sector. We had expected that we would
become a natural ally and partner, providing both content and traffic as
they ramped up their services. But instead of fighting the foreign
brands, many of these local players preferred to roll over and give up.
To be fair this was probably a reasonable response, since back in
2014-2015 it wasn't all that clear that the inbound travel sector was
going to grow quite as explosively as it did.
I very much remember a visit with Ikkyu, one of the largest Japanese
online travel players, where the manager quickly shut down our proposal
of working together (we wanted access to their domestic travel
inventory) with the statement that he had no plans to compete in the
inbound sector because the situation was already too overwhelming and
they were too far behind the foreign brands. This same admission of
defeat was re-played repeatedly as we visited with Yahoo, 4travel.com,
and various others.
By mid-2015 it was obvious that we needed to pivot, and soon. This was a
difficult choice to make, because not only did we have to divert
financial and human resources to a new direction that was unproven, but
also that we had to cut back on the existing media advertising business
to do so. With the sword cutting both ways, we wanted to hedge our bets
by leveraging the one thing that really differentiated us - our
contributor community, which by that time had grown to almost 20,000
people. About 10% of them lived in Japan, and the others were in
countries around the world that spoke one of the 13 languages that we
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Where: Alishan Organic Center
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Luckily some brainstorming gave us the first part of our pivot, which
was the re-application of our community. Instead of chasing advertising
dollars (although we still sell ads online) we started selling UCG
content authoring services to local governments and large corporations.
Our massive numbers and ability to cover the entire country hit a chord
with the many local government tourism bureaus who were just starting to
think about how to draw traffic away from Tokyo-Kyoto-Osaka. This was
also the time when Low-Cost Carrier airlines (LCCs) really started
hitting their stride and who were encouraging repeat travelers to
explore more of Japan outside the golden triangle.
The second part of our pivot came from the simple logic that if we
couldn't make money from advertisers we should offer services to those
who do have the budget - the tourists themselves. It was for this reason
that we did another fundraise, and with that money went out and bought
ourselves a Type 2 travel agency license, along with the
regulatory-required staff to operate that agency. This was a big leap in
faith, but again, the timing was right and this business has since grown
A Travel Agency license? Isn't the bulk of Free Independent Traveler
(FIT) travel now booked online? Yes, but as we have discovered, there is
still a very healthy number of travelers who need personal consulting
help for their trips. Think wealthy travelers looking for unique
experiences, and lots of groups, such as: large families, special
interest groups, sports groups, school groups, company incentive travel
groups, special needs groups, etc.
The good news is that both pivot efforts have been successful, and Japan
Travel KK is now in a good place. But in the back of my mind, while I'm
grateful for the stability that we have found through our "niche" lines
of business, I nonetheless want to grow the company to the original
vision of being a change maker and trusted leader online. Just where do
we get the leverage to do that? Well, in the absence of millions of
dollars of funding and engineering wonders, and despite the many
business adjustments made so far, sometimes you have to be true to your
original passion - and so we will continue developing our contributor
Japan Travel has had at least 3 pivots to get to this point, and each as
been an evolutionary step in survival. The lessons learned are that the
learning never stops, especially in this very crowded and competitive
sector. As Steve Jobs famously said, "...about half of what separates
the successful entrepreneurs from the non-successful ones is pure
So for this reason, Japan Travel last month revisited its beginnings by
hiring its first full-time community manager (versus a part-time one)
since I personally stepped down from that role several years ago and got
distracted with funding, engineering, and establishing the resources
that came after the first pivot. Our new community manager, Sebastien
Duval, has the explicit mandate of not only managing the current
community but also rolling out a new vision called "Community V2.0"
which opens up our systems and newly-acquired agency know-how to
individuals and partners who want to provide services to the travel
sector but who don't have the resources to do so.
In other words, more risk, more learning, and more opportunities - I'll
report more on our progress in coming weeks.
...The information janitors/
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+++ ABOUT US
Written by: Terrie Lloyd (terrie.lloyd at japaninc.com)
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