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Reaching 100 Million Japanese Shoppers on Rakuten Ichiba
- 1. Reaching 100 MillionJapanese Shoppers on Rakuten Ichiba Ryan Miller Vice President of Global eCommerce Strategy Reid Wegner Merchant Development Manager, Overseas Sales Strategy
- 2. 1. Rakuten Introduction 2.Japan eCommerce Market Overview 3. Cross Border eCommerce In Japan 4. Content Considerations 5. Rakuten Cross Border Overview 6. Achieving Success 7. How To Get Started 2 Agenda
- 3. 3 Rakuten Japan MarketplaceOverview 44,201 merchants $81.5B (AUD) 15.6M persons 105.9M persons 25.0% *as of Jan 31, 2006 60.0% *as of Jan 31, 2015
- 4. 4 Rakuten – GlobalBusinesses
- 5. Japan eCommerce MarketOverview
- 6. 6 B2C eCommerce SalesWorldwide (AU $B) – Forecast Source: eMarketer
- 7. 7 Japan B2C eCommerceSales (AU $B) (* 1USD = 119.91 JPY) +13.2% CAGR Source: Japan Ministry of Economy
- 8. Smartphone Penetration 8 Sources: eMarketer,Japan Ministry of Economy, Trade and Industry
- 9. Popular Payment MethodsIn Japan 9 Credit / Debit Card Convenience Store / Cash On Delivery Direct Debit 71% 18% 4%
- 10. Rakuten Ichiba MarketShare 10 Nearly 1/3 of all B2C eCommerce in Japan is through Rakuten!
- 11.
- 12. Drivers for CrossBorder Shopping 12 Source: PayPal
- 13. Cross Border eCommerceIn Japan
- 14. Survey: Top Reasonsfor Buying Cross Border 14 Source: PayPal
- 15. Example: Size Availability 15 Inthe US, a small number of buyers fall into this size range. Selling at 55% off.
- 16. Average Female ShoeSize 16 US = 8.5 JP = 23.3cm (US 6.5) Sources: National Shoe Retailers Association Japan National Institute of Advanced Industrial Science and Technology
- 17. Example: Not Availablein Home Market 17
- 18. Example: Better Pricevia Cross Border 18 The same item sells for AU $149 in Australia vs AU $690 in Japan
- 19. Japan eCommerce MarketShare by Category • Clothing & Apparel • Children / Maternity • Books, Videos, Music • Food & Beverage • Toys & Hobbies • Cosmetics / Pharmaceuticals • Consumer Electronics • Sporting Goods • Home Improvement • Furniture & Home Goods Popular Cross Border Categories Sources: Japan Ministry of Economy, PayPal
- 20. Popular Brands onRakuten Ichiba
- 21. Identifying Cross BorderOpportunities • Use web analytics to identify existing cross border visitors. • Research local competitors in markets you’re considering. • Brand manufacturers have the most control over pricing and product selection. • Keep an eye on exchange rates to ensure competitive pricing.
- 22.
- 23. Content Considerations • Don’tjust translate English product descriptions – localize! • Use high quality images / video. • Make sure content is optimized for mobile. • Leverage user generated content. • Weights and dimensions in metric units. • Apparel sizing conventions vary by country. 99% of population speak Japanese almost exclusively. Over 50% of orders are from mobile devices
- 24. Example: Australian ProductDescription
- 25. Example: Japan ProductDescription
- 26. Rakuten’s Cross-border ProgramSimplifies eCommerce in Japan
- 27. New Markets BringNew eCommerce Challenges Establish local business entity and bank account Design a Japanese storefront on Rakuten Ichiba Translate product catalog and brand assets Prepare for ongoing eCommerce operations in Japan Run local marketing campaigns Accept international payments Manage a new set of inventory and orders Ship products internationally Handle customer service in Japanese
- 28. Rakuten’s Cross BorderProgram Simplifies EC in Japan 1. Customers shop on the Rakuten marketplace in Japan 2. Rakuten orders go to merchant in Australia 3. Australian merchant ships merchandise to customer in Japan Rakuten Merchant Customer 12 3 Australia Japan
- 29. “Personal Import” Makesit Easy to Sell in Japan • Business registration in Japan not required • Product registration in Japan not required • Customer imports product as if purchasing from overseas website Direct purchase of foreign goods from overseas companies by an individual for personal use. Customer is responsible for import process Fully-landed cost paid by customer • Customer in Japan pays for duties and taxes • Shipping cost depends on seller’s carrier options • DDP options available from major carriers Merchandise valued below ¥16,666 is exempt from duties and taxes. Reference: Japan Customs (http://www.customs.go.jp/)
- 30. Service Partners EaseLocal eCommerce Ops in Japan Service PartnersMerchant Rakuten Store Design Marketing Order Management Customer Service Logistics TrafficProduct Feed Shipping Promotion Order Support
- 31. Rakuten’s Cross-border ProgramSimplifies EC in Japan Rakuten Merchant Service Partner Australia Japan Deep knowledge of Rakuten marketplace and success factors Knowledge of Japanese market and buyer behavior Japanese/English language capability Knowledge of Japan marketing and conversion optimization tactics Communication with Japanese customers Order management integrated with Rakuten End-to-End logistics support
- 32. Achieving Cross BorderSuccess on Rakuten in Japan
- 33. Rakuten is aMerchant-Centric Marketplace Products, not merchants (Commodity items, pure price competition) B2B2C (Largest GMS in Japan; Exclusive Merchant Support System) C2C + B2C (Auction-style, free shops attract small/casual merchants)
- 34. Custom Store DesignEstablishes Your Brand in Japan 34
- 35. Rakuten eCommerce ConsultantAdvises Your Business • Business requirements • Strategic objectives • Branding • Japan market entry knowledge • Merchandising guidance • Performance feedback and improvement consulting • Marketing strategies • Promotional recommendations
- 36. Rakuten eCommerce ConsultantLeads You to Success How can I increase my average order value? Let’s look at your site analytics! How can I increase repeat customers? Try nurturing customers using R- Mail! How can I attract new customers? Try a limited-time offer! Sales Target $100,000 / month $50,000 / Month $10,000 / Month
- 37. Rakuten Marketing ToolsDrive Traffic to Your Store • Sample/trial sets • Product branding • Prepare “entrance product” • Secure stock • Gift wrapping Product • Including “recommendations” • Advertisements, SEO • Events such as Rakuten Super SALE, Shopping Marathons • Rakuten Super DEAL • Follow the Japanese calendar for seasonal events/sales Events/AdsMarketing • R-Mail (mail magazine) • Press release • Affiliate • Customer reviews • Super Points incentive • Improving quality of page design
- 38. Australia Cross-Border CaseStudy: The Beauty Club 38 Store: The Beauty Club Country: Australia Category: Cosmetics Partner: EC Robo Shop Open: 2015 September
- 39. ECC Helped TheBeauty Club Grow Sales in Japan 39 Challenge The Beauty Club is a cosmetics retailer who competes with Japanese merchants to sell many famous foreign brands. They recognize that price competitiveness is a key to winning customers, but they don’t want to sacrifice margin. Strategy Rakuten’s ECC worked closely with The Beauty Club to select inventory that would take maximum advantage of the cross-border eCommerce model: Emphasize items whose brands control prices in Japan, so The Beauty Club can offer a lower price as an international seller. Offer exclusive products by identifying brand products that Japanese merchants do not currently sell on Rakuten. Tactics Rakuten’s ECC helped The Beauty Club analyze historical sales data by item and CVR to distinguish competitive and non-competitive products, and advised regular additions to increase catalog demand and total sale.
- 40. ECC Helped TheBeauty Club Solve Customer Challenges 40 “I finally found it on Rakuten. I used this item for over 10 years but could not find any stores that sell this item in Japan.” “I used this product when I traveled abroad, now I found it on Rakuten.” “It’s hard to find in Japan. Great items and the service of the store was excellent.”
- 41. ECC Increased Trafficand CVR for The Beauty Club 41 • Identified key products to attract customers and differentiate from competing Japanese merchants • Increased traffic by introducing large catalog of 20,000+ SKUs • Overcame price competition by identifying products with lower prices in Australia • Increased conversion by giving customers unique assortment at attractive price Traffic CVR
- 42. Get Started SellingCross Border On Rakuten in Japan
- 43. What are yourBusiness Goals in Japan? 43 • What products are you selling? • What is the demand for your products in Japan? • Who are your local competitors? • Who are you international competitors? • What’s your strategy for selling in Japan? • What is your sales target in Japan? • When do you want to start selling in Japan?
- 44. Find a RakutenService Partner in Japan 44 • Brand manufacturer or multi-brand retailer? • New brand or known brand? • Content-dependent or brand-dependent? • Size of catalog? • Type of products? • Marketing requirements? • Inventory regularity? Which Service Partner is Right for Your Business? Official Rakuten Service Partners
- 45. Choose a ShopPlan 45 • Select Shop Plan based on catalog size, commission rate, and contract period • One-time non-recurring account setup • System fee ranges between 8% – 12.5% of sales, varies by plan and volume
- 46. Plan Your TargetLaunch Date 46 Phase Activity Who Consult Partner Agree Apply Design Open Rakuten Merchant Rakuten Merchant Service Partner Merchant Service Partner Rakuten Service Partner Merchant Service Partner Rakuten Merchant Service Partner • Discuss business objectives in Japan • Understand operating requirement • Introduction to local Service Partner • Understand Partner services (store mgmnt, order mgmnt, CS) • Proposal from Service Partner • Merchant signs Agreement with Service Partner • Partner applies for Rakuten account on Merchant’s behalf • Design webstore on Rakuten Marketplace • Localize merchant content and branding • List product catalog • Open merchant store on Rakuten Marketplace • Begin active selling Duration from CONSULT to OPEN is approximately 2 months
- 47. Rakuten Empowers AustralianMerchants to Sell in Japan! 47 More customers Japan’s largest eCommerce channel Your brand Fully customized store design Your success Account consultants and partner services LET’S TALK! Ryan Miller VP of Global eCommerce Strategy ryan.miller@rakuten.com Reid Wegner Merchant Development Manager reid.wegner@rakuten.com
Editor's Notes
- #4 It is often said that Rakuten is the largest eCommerce company that you’ve never heard of. However, in Japan, Rakuten is a household name: Over 100M members which is more than 80% of the entire population 44K merchants AU $23B online sales
- #5 Globally we have businesses in eCommerce, Banking, Digital Content, Mobile, Travel… even a professional baseball team!
- #7 By 2018, eMarketer forecasts AU $4T global eCommerce market of which APAC will represent about 63%.
- #9 Japan has among the highest mobile penetration globally. Halfway through 2014, smartphone orders surpassed desktop.
- #10 Remaining 7% of payments are through various channels including mobile payments.
- #12 Forrester commissioned a study of 6000 global online shoppers to ask about online buying preferences. Overwhelming majority of cross-border shoppers prefer to shop from online marketplaces. Marketplaces have buyer protection in place to build trust with shoppers. Loyalty programs such as Rakuten’s Super Point program.
- #13 The items highlighted are already addressed when using a marketplace vs own site.
- #15 Generally two reasons for buying cross border – item not available domestically or better price.
- #17 With the previous example, Gilt would reach a much larger addressable customer base in Japan and most likely sell the item at a higher price.
- #18 The example shown here was inspired by one of my Japanese colleagues who spent some time in our San Francisco office and took a liking to some local chocolate. She has since moved back to Japan and now turns to the internet to order her favorite variety.
- #19 Almost 4.5x more expensive in Japan from a top domestic merchant on Rakuten.
- #20 Left side chart represents breakdown of total eCommerce market in Japan. Right side list comes from PayPal – top cross border categories by customer spend.
- #21 Apparel, Bags & Accessories, Cosmetics (Kiehl’s), Food & Beverage (Godiva), Sporting Goods, Lifestyle.
- #22 Look at specific ways to identify sales opportunities: Get started and closely monitor what sells well and what doesn’t. In the past year goods priced in USD have gotten about 20% more expensive in Japan.
- #24 Products will not convert well if simply translating English content. Mobile Optimized: Over half of Rakuten sales are from mobile devices. APAC customers expect much more content than Australian customers!
- #25 To demonstrate the importance of localization, consider the following item pages for the same product – one from Australia and the other from Japan. Large, clean image with bulleted text and prominently displayed Add to Cart button.
- #26 http://item.rakuten.co.jp/kompas/10027338 Japanese product descriptions have much more images, text and video than Australian websites. Lifestyle images and product video (35 images in JP vs 2 in AU). Exact dimensions of all components with schematics. Step-by-step instructions for using grinder, cleaning grinder and adjusting grind settings. Emphasis on quality materials and where item was built. Excerpt of magazine review. Customer testimonials included on item page.