First the good news; online travel is the standout not only in Japan but across Asia, which probably explained the general upbeat mood of the OTA panel at WIT Japan which featured three foreign brands – Agoda, Hotels.com, AirAsia Expedia – and four of the top local names – Rakuten Travel, Jalan, Ikyu.com and iJTB.



Picture shows from left: Wilfred Fan, Director North Asia, Agoda; Johan Svanstrom, Managing Director, Asia Pacific, Hotels.com; Dan Lynn, CEO, AAE Travel (AirAsiaExpedia), Masabumi Mori, IKYU.com; Suguru Tomizuka, Recruit (Jalan); Toshiyuki Imai, JTB (i.JTB) and Masashi Okatake, Rakuten Travel. Co-moderating the panel with Yeoh Siew Hoon, editor and founder of WIT, is Kei Shibata, CEO, Venture Republic.

In Japan, amid a declining travel market which has seen traditional travel agencies' total gross bookings drop from Y6,281 billion in 1996 to Y5,930 billion in 2010, online travel continues to grow and all four Japanese OTAs reported a pick-up in customer demand and a shift from offline to online.

Rakuten Travel, Jalan and Ikyu are taking market share from the traditional travel agencies – five of whom account for 60% of the market – which explains why Japan Travel Bureau has set up an online arm, iJTB, to defend its estimated 30% market share.

From the panel discussion, it was clear that iJTB is finding it a struggle competing against the more established trio. Toshiyuku Imai of iJTB said they had an advantage due to their earlier start while his company was just getting into the space.

At Jalan, which is part of the Recruit company, CEO Suguru Tomizuka is being given wider responsibilities following a restructure – he will now lead up to six verticals including restaurants and fashion.

Tomizuka said with domestic travel accounting for 85% of the market, Jalan would continue to focus on offering domestic content for local travellers.

Following its failed expansion into China last year, Ikyu's Masabumi Mori said he would remain focused on the luxury hotel segment. It also launched an English language website which has since been taken down, citing "site renewal" reasons. The company has expanded into restaurants. According to a news report, Ikyu saw a 40% jump in revenue from restaurant reservations in the year ended March and 30- and 40-somethings now make up more than 60% of registered users.

Mori said "restaurant reservations have led to more young women using the site" and Ikyu was also using social media to help bring back dormant members.

Rakuten Travel remains focused on expanding overseas and its biggest play is in South Korea – following its largest Japanese customer base – but CEO Masashi Okatake says it continues to face challenges of scale and finding the right model for the right market.

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