If you are interested in expanding your retail businesses to other markets, selling your products on a well-positioned eCommerce platform is always a smart move. Especially if your brand doesn’t have much awareness in that uncharted territory.
Ecommerce giants like Amazon and Rakuten in Japan, enjoy worldwide recognition and can serve as platforms for the exposure your business needs.
Rakuten, Inc. is the largest B2B2C (Business to Business to Consumer) eCommerce site in Japan. Given its strong presence, it is often referred to as “the Amazon of Japan” and it has earned a place among the world’s largest in terms of sales. This platform was founded in 1997 by Hiroshi Mikitani with the goal of empowring local businesses by connecting them to customers in Japan. In 2005, Rakuten started spreading its services across the globe with additional aquisitions and partnerships such as Buy.com, which was bought by the Japanese giant to expand its operations in the US.
Why Sell on Rakuten Japan?
To begin with, Japan has a very large and healthy eCommerce market that generates billions of dollars in sales. As of June 2019, Rakuten registered annual sales of 31.7 billion USD, while Amazon Japan reported a total of 25.42 billion USD. Rakuten’s current customer base is made up of almost 1.3 billion members, and the type of services this platform offers go from online banking and travel booking to video streaming and – most recently – online movie ticket booking. Rakuten has even branched out, investing in Pinterest and purchasing Viber.
These are other services Rakuten Japan provides to its users:
- Rakuten Ichiba – Internet shopping mall
- Rakuten Travel – Online travel reservations in Japan
- Rakuten Books – Online books, CD, and DVD store
- Rakuten Gora – Online golf course reservations
- Rakuma – Consumer-to-consumer mobile eCommerce app
- Rakuten BRAND AVENUE – Online brand fashion
- Rakuten Pay (RPay) App (for users) – Rakuten ID-based offline payment service
- Rakuten Pay (RPay) in-store payment (for retailers) – Credit card settlement service on smartphones and tablets
- Rakuten Delivery – Online food ordering and deliveries
- Rakuten Delivery Premium – Restaurant delivery service across central Tokyo
- Rakuten Rakoo – Online gourmet media “Rakoo”
- Rakuten CAFE – Offering customers a menu with some of the most popular products from Rakuten Ichiba
- Rakuten BEAUTY – Online beauty salon search and reservations
- Rakuten Shaken – Online car inspection search and reservations
- Rakuten Super Point Screen – Advertisement delivery app for smartphones eith which Rakuten members can earn Raluten Super Points
- Rakuten RAXY – A monthly subscription beauty-box service with items selected by beauty specialist
- Rakuten Rebates – A point-back service offering Rakuten Super Points for shopping on various affiliated official online stores
- Rakuten SUPER LOGISTICS – Distribution and fulfillment services for Rakuten Ichiba merchants and Rakuten Group services
- DREAM Business – Internet leisure services affiliated with public agencies and regional governments
Setting Up Your Account
The first thing that you need to prepare before getting on Rakuten Ichiba is a local Japanese business entity and bank account. (Companies based out of USA must meet a series of requirements.)
Sellers can take advantage of Rakuten’s partner network to help set up a store for their brand.
These partners act as intermediaries, contracted by both parties to set up and even operate the store.
Rakuten also provides you with a team of eCommerce consultants who will give you advice on Personal account management and sales strategies to help you grow your business on the channel.
This is what you need to do to start selling on Rakuten.com:
- Create a seller account.
- Enter your company’s details.
- Wait 3-10 business days for confirmation from Rakuten.
- Start listing your products.
- Go through the brand screening process.
This last step takes about four weeks. After consulting with a Rakuten sales advisor, the seller must undergo business verification and brand screening. (Brand screening does not apply to resellers, who must only prove the authenticity of their products.) Once the screening is complete and no issues are identified, the seller can begin listing products assisted by the launch team.
You will be asked to select the type of fee you woud like to be charged for each item sold:
- Monthly Seller Fee (39.00 USD)
- Per-item Fee (0.99 USD)
- Product Category Fee (5% – 14.5% of the overall product price)
Because the marketplace is predominantly Japanese – with a Japanese web interface -sellers will need assistance from someone proficient in the Japanese language to make sure their product page content is aligned with Rakutens’ standards.
On Shipping Services
Unlike Amazon, Rakuten does not have a warehouse, nor it handles shipments. However, it does have two delivery models, and sellers can take advantage of them to fit their customers’ needs:
- In-House Delivery. Sellers get to manage and operate their own deliveries, which allows them to have full control of their operations.
- Third-Party Delivery. Third-party shipping companies offer their services on Rakuten’s platform in case the seller’s delivery capabilities are beyond his capacity.
Perks of Selling on Rakuten
Here are a few other reasons to consider opening up a store on Rakuten Ichiba:
- Rakuten Super Points® – A generous rewards program, attracting and retaining lots of customers. The rewards system is a channel where Rakuten reinvests commissions to offer customers points that they can use for future purchases.
There are two types of Rakuten Super Points®:
- Standard Points. These are earned by making regular purchases that are not part of Rakuten Super Points® (There is no maximum of points earned on each purchase).
- Limited Time Points. Limited-time opportunities to earn a greater amount of points.
Sales events that offer 5% to 20% in rewards points funded by Rakuten is a great opportunity for sellers to build their brand and make a killing.
- The Rakuten Worry-Free Guarantee – Although this guarantee does not cover credit card disputes, carrier claims, return fees, warranty claims or shipping errors, Rakuten has its users back in terms of any issue related to a seller who hasn’t replied back to a claim within two business days. An unresponsive seller will have to deal with Rakuten directly in case he is unwilling to honor the policies on their store page.
- The Rakuten Affiliate Program – A comprehensive analysis that allows sellers to enhance their marketing strategies by accessing reports containing consumer insights to ensure a stronger campaign performance.
- Cash Back – This is an attractive feature for shoppers, and an effective way for sellers to build customer loyalty. As a seller, you will pay Rakuten a comission every time a customer makes a purchase at your store. Rakuten will split that comission with the customer in the form of cash (up to 40%)— only if they make a purchase by starting a Rakuten Shopping Trip.
Since Rakuten is a third-party marketplace, sellers on Rakuten compete with each other to sell, and not against Rakuten itself. In addition, sellers can introduce products that are not yet available in Japan and use this as an opportunity to sell off overstock and slow-moving inventory, such as smaller sizes and unpopular styles.
Creating a Seller account will also allow you to customize your own merchant storefront (although your design must also abide by Japan’s quality standards); getting paid on a weekly basis; and not worrying about creating promotions on a daily basis since your customers will enjoy from Rakuten’s reward system.
Customer Feedback and Product Review
The criteria include accuracy of item description, item condition, shipping speed, and customer service. Feedback scores influence search rankings, but sellers are not often suspended for having low scores.
Shoppers are not allowed to mention competitors on the price they paid for your product, and the Rakuten team encourages them to contact Customer Service before leaving a bad review. However, Rakuten does not allow for deletion of reviews; therefore, try to find the best way to guarantee a high-level service to keep your customer base happy.
Rakuten’s Global Partnership
Over the past decade, Rakuten has been a proponent of global partnership. In 2017, the company launches its global partnership with FC Barcelona; becomes the Official EC Platform Partner of the J. League (Japan’s professional football league), relaunching the J. League Online Store; announces its partnership with the NBA team Golden State Warriors to provide comprehensive live NBA coverage in Japan.
Rakuten Social Accelerator
In June 2019, Rakuten announced the Rakuten Social Accelerator in India. This program, which started in Japan in 2018, aims to help and give startups advice on how to run their organizations. Takuyi Mamabe, leader of the program explains: “With Rakuten Social Accelerator, we also want to provide concrete support through tech-based solutions for the problems these organizations are tackling, by sending Rakuten engineers to work with them, or if they are looking to expand their operations, we want to provide employees to help with their marketing. We want our volunteers to become members of the team.”
It is also worth mentioning that Rakuten is developing artificial intelligence (AI) solutions in five locations around the world, creating new jobs, and promoting sustainable development through the Rakuten Institute of Technology.
A Good Deal
Rakuten Ichiba is the biggest online marketplace in Japan, which is perhaps the most highly developed eCommerce market in Asia – and one of the most successful in the world.
Japanese consumers are highly educated and have high expectations. The demand for high-quality products is great, especially those that are not readily available in Japan for reasonable prices.
For the careful seller, Rakuten can be a very profitable marketplace.