According to various news outlets, including Bloomberg, tourist spending on beauty in Japan has seen sales of Shiseido’s skin and hair care products soaring, driven by a drop in the value of the yen and the subsequent influx of visitors, particularly from China.
The beauty company’s share prices hit record highs of over 2,500 yen during the surge that saw its prices leap as much as 20%, and remain above average - though susceptible to the currently volatile Nikkei stock exchange.
Japan’s economic fortunes have looked bleak of late, to the point that the Organization for Economic Cooperation and Development (OECD) recently shifted its prediction of stable growth for the country, to a forecast of an economic slowdown.
After three successive year-on-year jumps in tourism levels, in the final quarter of last year, the number of visitors to Japan dropped, and it seemed consumer spending as a result of tourism would take a hit.
According to the Japan National Tourism Organization, visitors from China reached an all-time high last August, with nearly 600,000 visitors to Japan, but that figure had slipped month-on-month to a reported low of 363,000 in November.
Indeed, until the end of January, Shiseido had seen its sales drop 8%, according to the Asian Review; however, the beauty brand’s recent share hike suggests this trend has now turned.
Tourism bright spot
It seems that tourism is proving a silver-lining to Japan’s gloomy economic conditions, with beauty tourism particularly out in front.
The weakness of the yen is proving an attractive prospect to visiting Chinese consumers, suggesting that although the general economic climate in Japan is set for a struggle, tourist-favourite markets like beauty and personal care may continue to see growth.
“A decline the value of the yen relative to other currencies and rising wealth in China has fueled an increase inbound travel to Japan,” a recent Bloomberg report confirmed.