Yoshio Horigome, president of Alpico Group, discusses the merits of Japan as a tourism destination, and highlights his company’s contribution to opening up lesser-known areas of the country to visitors.
Tourism inflows to Japan are increasing steadily, with arrivals up 25% year on year as at April 2017. With Prime Minister Shinzo Abe identifying tourism as a strategic sector for future economic growth, what challenges remain?
We have been promoting destinations in a fragmented way, focusing on just destinations at a time such as Asakusa, Mt. Fuji, etc. Therefore, I believe what has been missing so far is a comprehensive strategy to publicly promote the whole of Japan as a country. We lack a brand image of Japan as a whole country and we have not been good at presenting it in such a way.
How would you appraise the preparation and capacity of Japan’s tourism infrastructure to host the 2020 Olympic Games?
Japan has always been focusing on sectors such as manufacturing, trade and commerce and services. The country’s prosperity has historically been based on these areas, so we did not realize the potential of tourism until much later compared to other countries. For example, France and Thailand have been investing in tourism for a very long time. Japan, on the other hand, is only now starting to promote its tourism attractions. There still isn’t much knowledge about how to get around, where to stay at, how to get to Nagano, etc. We must emphasize and promote this information as a whole nation, with the private and public sectors working together.
What are the key advantages of Japan over the Southeast Asian countries that are more tourism-oriented?
Japan is a very fascinating country from different perspectives. First and foremost, Japan is blessed with nature. The Japanese safeguard and maintain the country’s beautiful environment. Secondly, there are historical sites and facilities such as castles, shrines, and temples. The modern influence from the West co-exists smoothly with the traditional buildings. Thirdly, Japan is safe and in order. As such, Japan is very diverse. I believe tourists can enjoy this diversity and feel relaxed and to some extent healed.
Nagano is a popular destination due to its proximity to Tokyo and ski resorts. What can the region do to tackle seasonality?
Japan, like many countries, has the distinctive beauty of four seasons. Earlier, when we strategized the promotion of Nagano, our focus was upon showing what distinguishes Nagano from its neighboring prefectures, and that happened to be its ski resorts. The 1998 Winter Olympic Games made Nagano prefecture extremely famous in the world as a place for winter sports and attracted many tourists for skiing. But as a result of the massive promotion of skiing resorts, the beauty of summer and fall are practically unknown.
For the last several years, we’ve been promoting these seasons, and we can see that this message is gaining traction in Southeast Asia, but not quite in the US and Europe. Alpico has been promoting year-round tourism. We started in Thailand, Taiwan and the rest of Southeast Asia. We don’t have the resources to disseminate our message wider into Europe and the US for now, although we need to expand to these regions. We need to work with the local governments in this regard and we have been discussing possible collaborations with them.
We are promoting sightseeing in Matsumoto but also in wider areas by working with neighboring prefectures and local transportation providers. For example, there is the “Mitsuboshi route”. We have discounted tickets for which Alpico works with Keio Bus, Hokuriku Railroad in Toyama prefecture and Nohi in Gifu prefecture. The route covers Shinjuku, Matsumoto, Takayama, Shirakawago, Kanazawa and Toyama.
Another route is called “Shoryudo” or the dragon path and involves even wider areas. The route starts in Nagoya, then to Matsumoto and the central Japan area. This is the way to promote Japan to overseas visitors. We are promoting tourism collaborating with other prefectures, rather than doing it alone because we believe that can attract more visitors.
Please tell us more about the genesis and evolution of Alpico since its foundation as Chikuma Railroad Co. about 100 years ago.
Chikuma Railroad Company was founded in 1920. One of the prefectural assembly members wanted to build a railroad in this area and raised money from the people who shared the vision. The assembly member was the first president whose name was Makoto Kamijo. I’m the eighth president. In 1943, we started the bus company and in 1951 the taxi business. We operate about 500 taxis and buses in this area. In 1966 we started the hotel business. The first one is a Japanese style hotel in Shoho Onsen. In 1968 we started the supermarket business. In 1985 we embarked on vacation home and golf course development. We have one golf course on a hill, at 1,200 meters altitude. In 1988, we started the highway express bus operation.
What are the competitive advantages of the Alpico highland express services?
The definite advantage is price. The bus is much cheaper than the Shinkansen or train. Secondly, the bus can take you to the doorstep of the sightseeing spot. If you ride a train you can go as far as Matsumoto station. In contrast, by bus you can get to the destination of Kamikochi directly, for instance. Thirdly, it’s more convenient because you can put all your luggage in a trunk. Also, for some routes you have a tour guide who provides information about the sites and destination on the bus as well as at the sites.
The bus service from Matsumoto to Shinjuku runs every hour and takes 3 hours and 15 minutes.
Considering your growth and diversification strategy, what are today the business sectors with the highest growth potential?
We would like to focus on tourism, specifically hotels. We currently have five hotels and the sixth will be open this fall. We plan to expand into other areas, outside of Nagano. We have few tourists in winter except for skiing, and Nagano is landlocked, so our aim is to look into hotels in a coastal area which people from Nagano might themselves visit.
We have one hotel conveniently located in front of the station. We also have the best city hotel in Matsumoto. Hotel Shoho is set on the hills with all rooms in the Japanese ryokan style. It is located on the hills from where guests can enjoy a beautiful view of Matsumoto city. Hotel Shoho also boasts the biggest size hot spring in the whole of Nagano prefecture. Kamikochi Lemeiesta Hotel is surrounded by majestic nature and guests can enjoy natural hot springs and French cuisine. The onsen water here is 100% clean and pure. People go there for trekking, hiking or just to enjoy nature. It’s a mountain resort hotel. We also have another Japanese style ryokan hotel, Sousen-no yado Suhaku, the only ryokan in Kami Suwa with hot springs coming from two different sources. Lakeside rooms also have a breathtaking view of Suwa Lake.
Could you please give us more details about the “Value up Alpico 2020”?
The year 2020 marks the 100th anniversary of ALPICO Group's existence, which is coincidentally the same year in which Japan will host the Olympics Games. This is therefore an auspicious year for us to implement a new strategy and determine which path the company takes in the future to make another 100 years of breakthroughs. This is how we came up with our mid-term management plan "Value up Alpico 2020", with a mission to go public on the stock exchange and increase the company's recognition and creditworthiness, along with the overall market value of the company.
Another part of the "Value up Alpico 2020" strategy is to reinforce business operations and marketing policies to keep up with the increasing influx of tourists from overseas, especially when the Tokyo Olympics kicks off in 2020. On top of this, we will continue to accelerate our business expansion with M&A activities for the hotel and taxi segments, and strengthen our loyalty program by using a point card system, starting with our retail business then spreading into other services. Lastly, the development of our IT infrastructure to enhance efficient utilization of customer information and achieve better business operational efficiency is another key measure of “Value up Alpico 2020”.
Do you foresee opportunities to strengthen partnerships with American companies or travel agencies in order to attract more American tourists?
We have been focusing on Southeast Asia and East Asia and have done nothing for Europe and the US thus far. But considering the population of the US and the high Japanese presence on the US West Coast, we need to beef up promotional activities in the US, and American agents could have good business opportunities. For example, there are a couple of agencies from Oceania bringing many tourists to Hakuba and the business is very successful. As such there could be good business opportunities for American companies as well.
What is Alpico’s strategy to increase brand awareness?
In order to generate a strong brand image, you must continuously promote the brand in the target market. It is not effective to do promotions here and there sporadically. So in the near future I would like to have an office in the West Coast of the US with permanent staff in order to carry out seamless promotions. In order to be effective, this strategy needs collaboration with Nagano prefectural government.
What is your suggestion for an unforgettable trip to Nagano?
An unforgettable trip here means appreciating the beauty of nature, especially the mountains as high as 3,000 meters that surround Shinshu. Secondly, charming old town streets and countryside. Thirdly, every season presents its own beauty. Soon, October is around the corner, and it’s the season for Momiji. And of course, it’s skiing in winter. You can come for skiing without any gear as you can rent any gear at almost all shops. Fourth: we have pristine water and delicious fruits such as apples and grapes. You can experience harvesting such fruits and enjoy them over our sake and wine. Nagano has many Sake breweries and is known for being a big producer of wine. Finally, guests will have an unforgettable memory of our onsen and Japanese cuisine.