Online shopping has become an accepted part of the retail landscape in many countries, including Japan, providing shoppers with previously unimagined choice in terms of product range and price and the convenience of 24 hour shopping from a desk, sofa or bed. Even in Tokyo, with its seductive, unrivaled shopping environment, known for its extended trading hours, peerless service, presentation and packaging, and sheer variety, e-commerce has in a short space of time become another established and accepted shopping avenue.
Global online sites like eBay, Amazon and Groupon all have a presence in Japan. More interesting, though, are the home-grown enterprises. We look at some of the main players in this post.
In Japan, more than 75% of the country’s 128 million population use the Internet: and of those, some 93% shop online via their PC or mobile phone. The country’s relative lack of English language fluency has meant that it’s the local sites that get the bulk of the traffic. Some of the biggest are rakuten, zozotown, Yahoo! Japan and Ponpare.
Rakuten is Japan’s number one online retailer, boasting more than 50 million registered users, some 10,000 employees and it is arguably the company that established the e-commerce market in Japan. Rakuten, Inc., began as internet shopping mall Rakuten Ichiba, founded in 1997 by current Chairman and CEO Hiroshi Mikitani. This portal is still going strong and is the jewel in the crown of an empire that is run from the company’s Good Design Award-winning Shinagawa “Rakuten Tower” offices. Businesses under the Rakuten banner include Rakuten Auction (founded 2005), Rakuten Rakuten Travel (2001 – a joint venture with NTT DOCOMO INC) for online travel bookings, Rakuten Bank (2009) and e-commerce through joint ventures or acquisitions in foreign markets such a China, France and the US.
Rakuten Global Market is the company’s international storefront. It can be accessed in English, Chinese and Korean, with personalized storefronts for countries such as the USA, UK, France and Singapore.
Zozotown, which opened in 2004, is the place to shop for hip Japanese and international fashion brands. The zozo prefix is applied to a number of the company’s online portals – zozoresort, zozovilla, zozooutlet and so on – each with its own fashion focus. The gamut of Tokyo retail can be found here; Japanese brands such as alfredo BANNISTER; BEAMS; double standard; UNDERCOVER; urban research; vendor; and international labels like agnes b.; FRED PERRY; MARC JACOBS; ZUCCa.
Zozotown is the cyber store of Start today Co. Ltd, the Chiba based e-commerce company started in 1998 by Yusaku Maezawa, that today generates more than 17 billion yen in sales. Business is about to get a whole lot bigger as last month the company launched an international version of the site: zozotown.com, which is accessible in Chinese, English and Korean; sells clothing, footwear, bags and accessories of more than 700 brands; is PayPal™ friendly and ships to dozens of countries.To simplify the shopping experience even further, there is of course a zozotown iPhone app.
While Yahoo! has been overshadowed by Google in the West, in Japan it has almost 70% market share, more than double that of Google. Yahoo Japan Corporation has its headquarters in Akasaka’s Midtown Tower and currently has more than 3500 employees led by President and CEO Masahiro Inoue. The company introduced its search business in Japan in 1996 and launched its online Shopping and Auction services three years later. Other related businesses have since been added, including, in 2001, broadband provision through Yahoo! BB.
Ebay shoppers will be familiar with the Yahoo! Auctions set up, while the Shopping site sells everything from clothing and homewares to electronics and foods. To purchase goods over 5000 yen, a user needs to become a Premium Member, which involves a monthly membership fee. Payment is by bank deposit, credit card or Yahoo’s own ‘easy payment’ system: kantan kessai かんたん決済, which connects to Japanese bank accounts and credit cards. Some transactions also allow payment to be made to the courier company on delivery. Users of Japanese ケータイcell phones can also access the mobile site.
Groupon Japan does a very nice trade and has a number of imitators, the most popular of which is Ponpare. Using a similar formula of group purchasing power to achieve heavy discounts, the site offers some at times amazing deals on all kinds of things, from ice cream and burgers to hotel rooms and hairdressing treatments.
Ponpare, ポンパレ was founded in 2010 as Ponparedo – as in coupon parade – by Recruit Co. Ltd, 株式会社リクルート, established in 1960 and whose business, based in Marunouchi, spans human resources, e-commerce, travel (the Jalan reservation site) and educational support services, overseen by almost 6000 employees.
Recruit is also responsible for the popular Jalan hotel, flight and other domestic vacation related reservations site, which can also be accessed in English. Both are available as mobile versions: Ponpare for iOS and Android devices; Jalan.net for iOS and Japanese carrier supported ケータイcell phones.
Given current global trends in online commerce and retailing – e-commerce totaled more that 570 billion dollars worldwide in 2010, and online commerce in Asia is growing by over 27% a year, according to Goldman Sachs research (via internetretailer), this is a space that is obviously going to continue to get bigger, more competitive and more interesting in Japan.