Rakuten raises the stakes

May 6th, 2010 by Felicity Hughes

Not content with being Japan’s No. 1 online shopping mall, Rakuten have announced plans to up their game even more by offering same-day shipping to their 50 million strong customer base. This move comes as a challenge to rivals Amazon, who already offer a similar service called oisogi bin (speedy delivery) to customers in the Kanto and Kansai region.

Rakuten, Japan's No. 1 shopping site, is upping its game

Rakuten, Japan’s No. 1 shopping site, is upping its game

According to Asiajin, up till now Rakuten’s business model has been a B2B2C (business to business to customer) model, but the new warehouses, due to be set up across the country, will streamline their operating systems, allowing Rakuten to make sure that goods are sent on the same day they are ordered.

The first warehouse is planned to be constructed in Chiba (presumably to serve Tokyo) this autumn, but Rakuten doesn’t only plan to offer this service to metropolitan areas, a further five other centers will follow over the next three years, which will also be able to service rural customers. The service may also push down delivery costs as items bought from separate Rakuten stores could easily be parcelled together.

As Rakuten tighten its grip on the domestic market, the Internet giant is also stretching its tentacles out overseas. In 2008, Rakuten set up Rakuten Ichiba Taiwan, a Taiwan-based Internet shopping site, and began an English-language version of its service that ships overseas and offers a slimmed-down range of Rakuten goods. But their biggest overseas project will launch in the latter half of this year. According to TechCrunch, China’s largest search engine, Baidu, signed a contract earlier this year with Rakuten to set up an online mall in China that is expected to quickly outstrip the competition. The Chinese version of Rakuten will initially mirror the B2B2C model of present-day Rakuten and will sell goods from popular foreign and Chinese brands as well as from smaller suppliers.

At present it seems like nothing can stop Rakuten’s inexorable rise.

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