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Overview of consumer issues

Part 1 : Today's consumer issues and consumers' behavior/attitude
Chapter 4 : Trends in consumer issues
Section 1 : Overview of consumer issues

The number of consumer affairs consultations increased for the first time in nine years in FY 2013

  • Information on consumer affairs consultations received by local consumer affairs centers across Japan is registered with PIO-NET. Trends in registered information indicates that the annual number of consultations has been declining in recent years after peaking at about 1.92 million in FY 2004 driven by the prevalence of fictitious bills but increased year on year in FY 2013 for the first time in nine years, reaching about 925,000. This is higher than any level recorded in four years since FY 2009.
  • The rise by more than 60,000 cases from the previous fiscal year is attributable primarily to the increase in consumer problems related to the "negative option marketing of health food" and "online stores."

Figure 4-1-1 The number of consumer affairs consultations increased for the first time in nine years in FY 2013

"Transport & communications services" account for the largest part of the consumer affairs consultations in number, while "financial & insurance services" represent the biggest share in value

  • The breakdown of the FY 2013 consumer affairs consultations by the type of product shows that "transport & communications services" was by far the dominant category, with over 200,000 consultations received, which is more than double the number for the second largest product category, "financial& insurance services." Some categories, including "foodstuffs" and "clothing items," ranked higher than the previous fiscal year.
  • The average payments made per case was particularly high for "financial& insurance services" among top products in the number of consultations.

Figure 4-1-5 Following on from FY 2012, "transport & communications services" accounted for an overwhelming part of the consumer affairs consultations in number in FY 2013, while "financial & insurance services" represented a major share in both the number of consultations and average payments made

Consumer problems faced by the elderly are further increasing

  • The number of consumer affairs consultations for elderly people in FY 2013 was 62.8% larger than that in FY 2008, or five years ago, and the year-on-year increase was also substantial in FY 2013. The five-year increase is well above the growth in the elderly population over the same period (13.0%), indicating the sharp rise in the number of consumer problems involving the elderly in FY 2013.
  • This growth is attributable to the increase in consultations on "telemarketing sales," especially "negative option marketing of health food."

Figure 4-1-15 Consumer affairs consultation for the elderly further increased in FY 2013

"Telemarketing sales" account for an increasing part of elderly consumer problems

  • The breakdown of the FY 2013 consumer affairs consultation by sales/purchase method indicates that "mail order sales" and "purchase at stores" account for about 30% of the total, respectively. However, trends over time for the elderly show that "door-to-door sales" are declining, while "telemarketing sales" are increasing, reaching 23.9% in FY 2013. The factors behind this include the increase in the victims of "negative option marketing of health food" through telemarketing and the continued prevalence of problems caused by "theatrical solicitation."

Figure 4-1-6 Telemarketing sales show a notable increase as the source of problems for the elderly

Elderly people's consultation cases involve larger amounts of money on average

  • In FY 2013, the average contract/purchase value per consultation case was about 1円.28 million, and the average payments made per case were about 540,000,円 both showing a downward trend. Meanwhile, an analysis by generation indicates that these amounts are generally larger in cases involving elderly people than those involving people aged under 65 years: in FY 2013, the contract/purchase value was about 1円.68 million and the payments made were about 870,000円 among the elderly. The average amounts declined in FY 2013 mainly because of the surge in the number of consultations on "negative option marketing of health food," which usually involve relatively inexpensive products, as well as the decrease in the number of consultations on expensive products, such as financial products.

Figure 4-1-10 FY 2013 consumer affairs consultations involved smaller amounts on average

Consultations on "secondary damage" from "telemarketing sales" are increasing among the elderly

  • "Secondary damage" refers to damage resulting from solicitation tactics targeting victims of past consumer frauds (e.g., real estate frauds for selling waste land, fraudulent investment solicitation) and offering them to help recover their damages. The number of consultations for the elderly has sharply increased since FY 2010, with about 7,800 consultations received in FY 2013. A characteristic trend of late identified through analysis by sales/purchase method is the growth in the percentage of "telemarketing sales." "Mail order sales" are increasing as well. By contrast, "door-to-door sales" have been flat over the long term.

Figure 4-1-20 Consultations on "secondary damage" from "telemarketing sales" are increasing among the elderly

The number of consumer accidents notified under the Consumer Safety Act has declined, but that of serious injuries has not

  • Since the establishment in September 2009, the Consumer Affairs Agency has received information on consumer accidents and other incidents from relevant administrative organizations and local governments under the Consumer Safety Act and other relevant laws. The collected information has been consolidated and analyzed.
  • In FY 2013, the Consumer Affairs Agency was notified of 12,627 case of consumer accidents (down 0.8% from 12,729 cases in the previous fiscal year) under the Consumer Safety Act. These consisted of 3,511 cases of "life or health-related accidents" (up 24.8% from 2,813 cases in the previous fiscal year) and 9,116 cases of "property-related cases" (down 8.1% from 9,916 cases in the previous fiscal year). There were 2,194 cases of "life or health-related accidents, except serious injuries" (up 47.1% from 1,491 cases in the previous fiscal year), and this increase is attributable mainly to cases associated with Aqli Foods Corp.'s frozen foods tainted with pesticide and with the deformation of water heater casings.

Figure 4-1-22 12,627 case of consumer accidents were reported to the CAA in FY 2013

In the past year, 8.0% of consumers experienced harm or problem

  • Among consumers surveyed, 8.0% said they have experienced some kind of harm or problem with products/services purchased in the past year. Those who have experienced such harm or problem were asked whether they consulted or told anyone about it. The results revealed that 50.0% of women among them consulted no one, and the percentage was higher for men, at 57.4%.

Figure 4-1-27 In the past year, 8.0% of consumers experienced harm or problem

Figure 4-1-28 Male victims are more likely to consult no one than females

Figure 4-1-29 Female victims tend to consult someone close

Victims' major reason for consulting no one was that they "thought it would be no use consulting someone" (55.8%)

  • Victims consulted someone because they "expected resolution through consultation" (42.7%) or "did not know what to do" (25.2%). The most common reason for consulting no one was that victims "thought it would be no use consulting someone," an answer given by 55.8%.

Figure 4-1-30 Major reason for consulting someone was that victims "expected resolution through consultation" (42.7%)

Figure 4-1-32 "Thought it would be no use consulting someone" was the answer given by 55.8%

Losses from harm and problems to consumers amounted to an estimated 6円.0 trillion in the past year

  • The losses from harm and problems to consumers (total expenditures on products and services associated with consumer harm and problems) in 2013 amounted to an estimated 6円.0 trillion. This is equivalent to about 1.2% of Japan's GDP and about 2.1% of the final consumption expenditure of Japanese households.

Figure 4-1-33 Total expenditures on products and services associated with consumer harm and problems in 2013

  • One out of every 13 Japanese has experienced some kind of consumer harm or problem in the past year.
  • On average, a victim spent (paid) about 590,000円.
  • A per capita expenditure was about 47,000円.
  • The percentage of cases brought to local consumer affairs centers was about 2.5%.
  • In terms of the financial value involved, cases related to financial products, construction and real estate seem to account for a major part (based on PIO-NET information).