Ecommerce Wars: Rakuten vs. Amazon Japan

When thinking about Japan’s e-commerce market, 3 major company names immediately spring to mind; Yahoo! Shopping (Lohaco), Amazon and Rakuten. Recently Amazon Japan has increased its Japanese marketplace presence thanks to its superior logistics capabilities and focus on price and convenience. Although Amazon Japan has not taken much of Rakuten’s market share of sales, they have replaced a lot of Lohaco’s.

These three companies cumulatively make up almost 50% of all e-commerce sales in Japan

Rakuten primarily remains the frontrunner of the 3 in terms of e-commerce sales, perhaps due to their Rakuten Super Points scheme. The loyalty program rewards customers with points for using all the different services they provide – points that can also be redeemed on any of their services. However, innovative companies such as Amazon have successfully begun to fulfil customer needs by incorporating internet technology to their strategies.

From 2016 to 2017, Amazon made up 20-23% of Internet Retail Market Share, with Rakuten making up 18-20%, and Lohaco taking only 9% of overall e-commerce sales

More recent reports suggest that Amazon.co.jp achieves 15.3M visitors a day whereas Rakuten receives 7.01M – suggesting that Amazon’s site is fast becoming more popular in Japan. Those wanting to expand their business into Japan should certainly investigate whether Amazon.co.jp may be the best marketplace to sell on. Amazon has also invested in setting up a network of distribution centres within Japan which will prevent vendors and sellers who do not have established distribution, logistics and marketing teams overseas from struggling with the lack of resources that those who sell on Rakuten might find.

Amazon’s brand value grew by 52% between 2018 and 2019

Since Rakuten allows its merchants full control over their products on their site, if international merchants are unaware of cultural differences, they may find themselves unable to establish their brands properly within the Japanese market. For example, since more than 99% of Japan’s population only speak Japanese, it is necessary for a brand to have in-depth translation on their site.

Molzi can help you expand into Amazon Japan. Get in touch if we can help!