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Saturday, Aug. 16, 2008
Cash still flows for weddings
The economic slowdown has done little to curb knot-tying splurge
Consumers are being forced to tighten their belts by soaring food and oil prices and the expanding economic slowdown triggered last year by the subprime-loan crisis in the United States.
However, they don't hesitate to splash the cash when it comes to the one event all girls dream of — a wedding.
According to a survey on wedding trends conducted by Recruit Co.'s Zexy wedding magazine, couples spent an average of ¥4.14 million in 2007 to tie the knot, including fees for a wedding ceremony, party and honeymoon, up ¥174,000 from a year ago.
When focusing only on couples in the Tokyo metropolitan area, the figure was ¥4.36 million, up a staggering ¥992,000 from 2002.
"Wedding ceremonies are traditionally funded by congratulatory money, while there is little change" in activities at weddings, said Reiko Takechi, Zexy's editor in chief for the Tokyo metro edition. "Weddings are little affected by the state of the economy."
But the style of wedding ceremonies has had some makeovers over the years, she said.
Before Japan experienced a bubble economy in the 1980s, weddings were family-oriented with the emphasis placed more on the two families instead of the bride and groom, Takechi said.
"During the bubble economy, weddings became a couple-oriented ceremony and now it is centered on the couple and the guests," she said. "Couples want a wedding they and the guests can both enjoy."
The change in style came with a change in demand.
Around 2000, many ventures found lucrative business opportunities in the ¥2 trillion bridal industry, offering customized wedding ceremonies for each and every couple instead of the uniform wedding package offered by hotels and wedding banquet services.
One such company is Take and Give. Needs Co., one of the pioneers that launched meticulous marketing campaigns on its clients and organized weddings full of surprises and drama.
"When I attended my friend's wedding, I found out that it wasn't fun at all," said Yoshitaka Nojiri, president of Take and Give. Needs. "There wasn't any dramatic event and the wedding was all held in the same style."
Nojiri's idea of an ideal wedding was similar to scene in a typical Hollywood movie — a reception held in a big summer house with a garden, guests drinking champagne and friends jumping into a pool.
So he turned his idea into a business.
T&G, which is listed on the first section of the Tokyo Stock Exchange, became a pioneer of what is now called the "guesthouse wedding" style, building the appropriate facilities and arranging customized wedding parties.
"When I started the business, the style of wedding, from programs to invitation cards, was nothing near what the bride and groom wanted," Nojiri said. "By starting my business, I helped satisfy the demand that already existed."
According to the Zexy survey, guesthouse weddings account for 19.0 percent of all nuptials held in Japan, up from 14.2 percent in 2005. Hotel weddings dropped to 32.9 percent in 2007, down from 38.0 percent in 2005.
The emergence of T&G and other ventures helped stimulate the bridal industry.
But at the same time, traditional hotels and wedding banquet services in the bedroom communities where ventures built new guesthouse facilities began to their business decline.
Some simply closed, while others were purchased and renovated by those ventures into stylish new facilities.
Wedding venture Novarese Inc. refurbished Izumo Kaikan, a traditional wedding facility in Omiya, Saitama Prefecture, and in 2004 reopened it under the new name The Royal Dynasty. After the renovation, sales rose threefold.
And the remainder that survived the intense competition rethought their businesses, introducing good points from the guesthouse-style weddings, to meet the needs of couples, said Masayuki Dojo, a journalist who covers the bridal industry.
"The measures they took were to build a new guesthouse-style banquet, create a bride's room and make sure guests from different wedding parties do not meet in the facility," said Dojo, author of "Yokuwakaru Buraidaru Gyokai" ("Everything About The Bridal Industry").
As the number of couples marrying has been on the decline since 2001 amid the falling birthrate, competition is likely to become more fierce as bridal companies struggle to increase their share of a dwindling market.
But market watchers say the drop in the number of couples marrying does not necessary translate into a shrinking bridal industry.
Although about 714,300 couples married in 2007, down from 731,000 the year before, the amount of money they spend per guest is on the rise.
In the metropolitan area, couples spent ¥39,000 per guest in 1998 to hold a wedding ceremony and reception but the figure rose to ¥52,000 in 2007, the Zexy survey found.
"Even if couples hold the ceremony with a smaller number of people, the spending per guest is pretty high," Dojo said. "Organizers are shifting their business target more on to the amount of spending per guest than the number of couples they organize (weddings for). This trend is likely to continue in the coming decade or two."