Japan is one of the fastest-growing and fourth largest ecommerce market in the world, accountable for 5.4% of the total retail sales globally. Although Japan may seem a small fish compared to China, this country has increasingly become an attractive trading space for international online sellers. The Japanese ecommerce market is mature and compact, has solid distribution infrastructures, and its return rate is very low. Also, Japanese consumers are keen online shoppers; indeed, the ecommerce user penetration currently stands at 79.7%, and it is expected to hit 91.2% by 2025.

To sell successfully in this territory, foreign merchants have to make a real effort to ‘putting themselves in their customer’s shoes’ as Japanese shoppers’ expectations and habits differ from those of other parts of the world. First, instead of price and convenience, buyers give particular importance to the product quality in this country. A detailed description, high-resolution photos and well-prepared presentation of items are crucial to selling successfully in Japan. Second, sellers need to provide a fast and efficient delivery service as Japanese consumers expect their order to be delivered in 24h and claim a lost parcel if this doesn’t arrive within three days. Finally, less than 8% of the total population speaks English, so international sellers have the only option to showcase their products in the Japanese language and hire local customer service.

If you wish to enter the ecommerce arena and have your products in the spotlight in Japan, online marketplaces are the best opportunity. Three gigantic online platforms dominate the territory: PayPay Mall, Amazon Japan and Rakuten Ichiba. Over 75% of the total population purchases regularly in these marketplaces in Japan.

PayPay Mall was founded in October 2019 by Yahoo! Japan to regain the prime position in the Japanese ecommerce lost by Yahoo! Shopping Japan in favour of Amazon Japan and Rakuten. Following the successful business case of Alibaba in China that launched Tmall in partnership with the payment solution AliPay, PayPay Mall has a close connection with the payment app PayPay created in 2018 and from which the marketplace takes the name.

Today, PayPay Mall is the largest online marketplace in Japan. It ranks as the second most visited platform globally with 2.08 billion monthly visits – only Amazon can compete with these astonishing numbers. For foreign sellers, trading on this marketplace might involve heavy lifting by setting up a local presence, partnering with a cross-border solution provider or working with a local agency.

The gigantic online marketplace and well-known worldwide, Amazon, launched a local platform in Japan in 2020, and now it has become one of the leading online platforms in the country. With over 576.6 million monthly visits, Amazon Japan ranks as the second most browsed online marketplace by Japanese consumers.

Compared to PayPay Mall, which is accessible only if you have a local presence, Amazon Japan is more flexible in these terms. Because of this, it’s usually the first marketplace where international sellers start trading in Japan. Also, Amazon Japan presents the same web structure and design as any other Amazon marketplace, which might reassure and feel more familiar for merchants adventuring in the Japanese eCommerce.

Since Rakuten Ichiba’s foundation in 1997 in Tokyo, Rakuten has grown to become the go-to shopping destination for millions of Japanese consumers. The online marketplace is a pure third-party seller ecosystem founded with the principle that online shopping should be entertaining and highly personalised. While Rakuten Ichiba has become a global marketplace, Japan remains its most profitable territory, with a third of the national ecommerce flowing through the platform and over 53,000 merchants selling actively on it.

The platform is the fifth most visited website in Japan and ranks as the third top online marketplace in the territory – Rakuten records over 521.1 million visits per month. Compared to other marketplaces where consumers prefer to purchase via computer/laptop, Rakuten sees most of the online sales coming from the app. Mickey Mikitani, CEO of Rakuten, reported: “Since I talked about it back then, the explosive growth of mobile data usage hasn’t slowed down […]. On Rakuten Ichiba, some 76.5% of sales are already coming through mobile devices.”

According to the latest news, this is just the beginning of Rakuten’s empire that saw a 50% year on year growth in its gross merchandise volume (GMS) in 2020. “I’ve always had this rule about ones and threes. Once we hit 100 million yen (in GMS), our next goal was 300 million, then 1 billion, 3 billion, then 10 billion,” said Mikitani. “For our next annual GMS target of 10 trillion yen, I’d love to see Rakuten Ichiba get there by 2030.”

Trusted by major brands and retailers, Arcade Retail is a market-leading technology and service provider, which provides a flexible solution that removes the hassles of selling across international borders via online marketplaces, including Rakuten and Amazon. Get in touch today to discover how we can make your cross-border expansion easy!