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Chinese ‘Bakugai’ on Spending Craze in Japan

The term for Chinese tourists on spending sprees in Japan: Bakugai

08·25·2015

Chinese ‘Bakugai’ on Spending Craze in Japan

The term for Chinese tourists on spending sprees in Japan: Bakugai

08·25·2015

The tourist walks along the Japanese street. They are already loaded down with bags from a frenzied shopping trip, but outside the department store, they still have the energy to stop and look in the window.

“I want all of these.”

Despite tension between the two countries, the number of Chinese visitors to Japan has been increasing at a tremendous speed. This has even spawned a phenomenon called bakugai (爆買い) in Japanese, which refers to how abundantly–almost ridiculously–Chinese visitors in particular consume money when purchasing Japanese goods.

According to a report on July 19 by the Japanese Tourism Agency, the average amount of money those Chinese visitors spent on each trip was more than 285,000 JPY (about 2,400 USD) per person, which is tremendously high compared with the average of all the foreign visitors, which stands at 177,428 JPY.

It’s not just impressive spending on an individual level, the sheer number of Chinese visitors is staggering. From January to July this year 2.7 million Chinese made the trip, almost double the amount from 2014’s January to July period.

It was the most from any country and represented approximately one-quarter of all the foreign visitors. The total expense that Chinese visitors spent in this first half of the year even reached 635 billion JPY (5.3 billion USD).

This goes some way toward explaining why the term “Bakugai” has sprung up from barely any mention, to suddenly become a buzzword.

The statistics below show how many times the word “Bakugai” was used in Japan’s main newspapers each year.

bakugai 1

The graph shows how many times the term “Bakugai” was used in major newspapers each year from 2008 to 2015 [business.nikkeibp.co.jp]

Naturally, China’s booming economy has been the key reason for this “Bakugai” phenomenon. Another is no doubt the trust that Chinese people place in Japanese products after a series of product-safety scandals in China.

Loosened visa requirements no doubt factor into the equation as well.  In addition, Japan has introduced a new tax-free system for foreign consumers, and is trying to further improve the service. With a weak Japanese Yen recently, Japan now presents an attractive shopping prospect.

But will recent stock market jitters in China affect the situation?

Shigeto Kubo, the commissioner of the  Japan Tourism Agency, explained at press conference on August 19 the current situation: “Since various factors decide the whole situation of Japanese visitors, it is difficult to mention the direct influence of the current stock market situation; nevertheless, at present, no remarkable influence on China’s Japanese visiting tours can be seen.”

China’s next holiday season in October (国庆节) may give us an insight into how the country’s stock situation is affecting the number of Chinese visitors in Japan. However, it doesn’t seem likely that this shopping trend will grind to a halt.

Now let’s look at what they are so eager to buy in Japan.

Chinese visitors often purchase what they call the ‘Four big treasury’ (四大宝) items, which simply means some must-buy items when visiting Japan. These include electric rice-cookers, smart-toilets, kitchen knives, and thermoses. Apparently, they buy these items because of their quality and longevity, which are believed to be better than comparable Chinese models.

Most are purchased for the buyers themselves, but there are also significant numbers of items purchased for family and friends.

Interestingly enough, they often choose souvenirs from goods that are not particularly popular among Japanese people; moreover, they tend to purchase a ridiculous amount of those items.

Part of this can no doubt be chalked up to the differences in items discussed on Chinese social media vs Japanese.

Traditionally, Chinese people do really care for their reputation and honor within their community, and therefore, bringing back decent souvenirs is a key mission on any trip.

Also, a common source of inspiration for Chinese buyers is social media and the reviews on it, often written by those who already traveled to Japan.  Thus, they tend to buy what is regarded as great among Chinese community, not Japanese.

Some of the most representative items are Japanese over-the-counter (OTC) medicines, introduced to them on social media by Chinese peers as the “12 God’s Medicines (神薬12)”. These include Eve Quick (headache medication), Cooling Gel Sheet, and Sakamu-care (liquid bandage). One of those OTC companies reported sales between April and July as being five times higher than during the same period in the preceding year.

The increasing number of visitors directly profits Japanese companies including airlines and hotels. At the same time, it also gives an opportunity for some clever Chinese to make money.

There have been some Japanese media reports of Chinese visitors buying everything on a shelf at a shopping store, but sometimes coming back to the store later and asking to return all of them, most of which are apparently damaged. These people, pretending to be visitors, are alleged to have made a switch, so they can sell the real, expensive brand items off in China later.

IN addition, a Chinese student studying at a Japan’s master program started a service to purchase Japanese products for those living in China. By sending those items to clients, she earns an agent fee through social media payment platforms.

On the one hand, the Japanese government and each company welcome and encourage those Chinese visitors for the economic profits they bring to Japan, but on the other hand, some express their negative feelings toward the manner of those Chinese visitors too.

According to a media report last month, excessive shopping at Narita airport’s duty free shopping area by Chinese shoppers caused 30% of flights from the airport to China to be delayed.

Also, a Chinese youth working in Japan said in a media interview that seeing Chinese people go on buying binges makes him feel ashamed, because they seem to forget the value of money, that Chinese would really appreciate when they were poor.

No one can tell how long this Bakugai madness will last or where it leads those Chinese buyers.

 

This might be where it all began