Wanderlust reignited: Is Japan’s economy on the mend?

From online flea markets to pet insurance to drone deliveries, the services Rakuten offers in Japan are nothing if not diverse. Many of Rakuten’s businesses are leaders in their respective industries, so it’s little wonder that pundits look to Rakuten to gain a broader picture of Japan’s overall economy.

Last month, Rakuten’s data gurus pooled their knowledge to reveal some of the major consumption trends we can expect to see in summer 2022 and beyond. Data was collected from a range of Rakuten services, including online shopping mall Rakuten Ichiba, reservations portal Rakuten Travel, and a number of other e-commerce businesses such as Rakuten’s free parental support membership program Rakuten Mama-wari, and music streaming app Rakuten Music.

So where does Japan stand as the global economy looks to move on from the rough and tumble of the pandemic?

Scratching Japan’s itchy feet

One significant barometer of the health of Japan’s economy is its travel industry. Travel restrictions and a general wariness of the pandemic saw many would-be travelers elect to stay home over the summers of 2020 and 2021. This year, however, data from Rakuten Travel indicates that Japan’s pent-up wanderlust seems to have reached its limit.

Compared to 2021, overall travel reservations are up 70% for the months of July and August 2022. The younger cohort seems to have the strongest urge to travel—reservations jumped around 100% for travelers in their 20s, and grew as much as 130% for those traveling with children or in groups of three or more. The older generations aren’t staying home either: Those 60 and above also topped the overall average, reserving 80% more than the previous year.

It seems that Rakuten Travelers are also seeking more adventure than before, forgoing convenience and familiarity to take trips further away from home. The rate of travelers traveling long-distance this summer is 12.4 percentage points higher than the first six months of the year, while around 54% of travelers are picking destinations they’ve never visited before—up from just 49% in 2019.

The most popular domestic destinations also happen to be Japan’s two most remote prefectures—Hokkaido in the far north, followed by Okinawa in the far south. Compared to pre-pandemic levels, Rakuten Travel has also seen an uptick in wanderers seeking out unforgettable experiences such as the Awa Dance Festival in Tokushima Prefecture. Even golfers are being more adventurous: Golf reservation platform Rakuten GORA recorded around 50% more golfers opting for overnight trips over day trips.

While adventure is the dish of choice for many returning travelers, it’s not the only alluring item on the menu: Luxury accommodation reservations grew 30% on 2019, with search terms such as ‘suite’, ‘top floor’, ‘club floor’ and ‘lounge’ entering the rankings. The share of reservations with hotel dinner included rose by around seven percentage points.

Online shoppers gear up for the outdoors

The e-commerce data from Rakuten Ichiba echoed these adventurous trends, as Japanese shoppers gear up for a summer spent in the great outdoors.

Compared to summer 2021, revenue for swimwear increased by 60%, yukata (summer kimono) by 30%, swim rings by 60% and firecrackers by 20%. Travel bags saw more than double the sales, and sales for UV-protective clothing grew by 40%, hats by 30% and sunscreen by 20%.

But summer isn’t all fun and games, and many consumers are taking serious measures to prepare for looming power shortages in Tokyo and surrounding areas. Some are looking to combat climbing energy prices through alternative cooling goods such as neck coolers: This category grew around 6.7 times compared to the previous year.

Meanwhile, Rakuten Ichiba’s disaster preparation category is also undergoing significant growth: Demand for disaster-related goods jumped by 20%, although at least some of the items in this category could also double as tools for outdoor recreation.

Large portable power banks—some powerful enough to power appliances such as fridges and air conditioners—saw a 60% rise in sales, while mobile water purifiers sold around 4.6 times the previous year, making the rankings alongside other items such as solar lanterns and outdoor tables.

Inflation and a weak yen stifle hopes of recovery

In June, the value of the Japanese yen sank to its lowest against the U.S. dollar since the 1990s, and—for the first time in decades—Japanese consumers are feeling the effects of inflation. Many shoppers are scouring platforms like Rakuten Ichiba for ways to decrease everyday expenditure.

For some, these savings are coming in the form of food items with long shelf lives, such as canned foods, as well as items that can be bought in bulk or have been discounted for being misshapen or damaged. Sales of unshapely onions grew by around 90%, while soy meat substitutes saw an 80% rise in sales.

Japan’s domestic travel industry may be showing signs of recovery, but tightening household budgets and a historically weak yen leave doubt that this renewed wanderlust will extend to international travel—this summer, at least.