Grow Your E-Commerce Sales to Japan

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Today’s Agenda

Rakuten: Who we are

E-Commerce in Japan

About Rakuten Ichiba & Case Study

How You Can Sell With Us

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Rakuten: Who We Are

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Founded : February 7, 1997 IPO: April 19, 2000 (Jasdaq Stock Exchange) Chairman & CEO : Hiroshi Mikitani

• The First Office : Atago in Tokyo, Japan• Employees : 6 (at the service launch)• Business : Rakuten Ichiba (online mall)

Company Profile

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Office : Crimson House (Tokyo, Japan) Employees : 12,288 (as of June 30, 2015) Market cap : JPY 2.97 trillion (US$ 25.0bn), as of July 21, 2015 Businesses : Rakuten Ichiba (e-commerce), Rakuten Travel, Rakuten Securities, Rakuten Card,

Rakuten Bank, Kobo, Viki, Viber, Ebates etc.

Company Profile

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Japan Content/E-books

OverseasE-Commerce

106M 64M45M

Viber

711M

Japan: Rakuten Membership as of December 2015Overseas E-commerce: Total IDs of Rakuten’s e-commerce outside Japan as of June 2015 (excluding Play.com) Viber: Unique IDs as of December 2015Content/ Ebooks: Sum of Viki’s MAU and IDs of Rakuten Kobo as of June 2015

Rakuten Membership

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Rakuten’s services in various sectors

Shopping

Payment

Credit Card

Banking

Brokerage

Insurance

Transportation

SportsMobile

Reading

Video

Travel

R

Rakuten Ecosystem

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E-Commerce in Japan

3,2%

4.4%3.9%

3,4%

2,8%

The Transition of Japanese E-Commerce’s B-to-C Market（ 2010～ 2014）

Source: Ministry of Economy, Trade and Industry　平成 26 年度我が国経済社会の情報化・サービス化に係る基盤整備（電子商取引に関する市場調査）　報告書

0

2

4

6

8

10

12

14

2011

8.5

2010

7.8

Ecommerce market size (trillion JPY)

9.5

2012

11.212.8

2013 2014

Ecommerce ratio

Ecommerce market size(trillion JPY)

+64% growth in 5 years

The Japanese E-Commerce Market

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4th

largest globale-commerce market

100Million Internet users

82.8%Internet Penetration

Rank Country Market Size (Billions $)

1 China 562.66

2 US 349.06

3 UK 93.89

4 Japan 79.335 Germany 73.46

6 France 42.62

7 South Korea 36.76

8 Canada 28.77

9 Russia 20.3

10 Brazil 18.8

Japan’s is the 4th Largest E-Commerce Market (2015)

http://www.statista.com/statistics/377624/leading-countries-retail-e-commerce-sales/

E-Commerce Market Comparison by Country

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Source: Fuji Keizai: Current Condition and future of Mail-Order and E-Commerce Business 2014-2015 Market Version

26%37% 40%

24% 27%35%

15%

17%

14%

5%7% 26%

8%

5%

5%8%

6%

2%

6%

Overall Apparel

2%

Beauty/personal

care

Yahoo!

楽天

Amazon

Electronics

3%

Food Household Goods

Health foods/medicine

Japanese E-Commerce: Market Share by Category

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②Market Place①Branded Site

• Control branding• Design flexibility• Customer relationships

• Product platform• Traffic• Demand generation

E-Commerce Options in Japan

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About Rakuten Ichiba

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Rakuten IchibaShare in Japan

26.8%

GMS Ratio from mobile

54.2%

# of Merchants

44,201as of Dec 2015

GMS domestic ECYoY

+10.9%

We are Japan’s #1 Online Shopping Mall

What is Rakuten Ichiba?

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We have a B2B2C marketplace model:

- Rakuten does not do direct sales of its own goods.- Rakuten Ichiba provides a shop centric environment - Participating merchants have no limits placed on getting direct access to customers.

Our Business Model

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Dynamic and synergetic shopping mall with various types of merchants

Our Approach

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Your Own Branded Store

The advantages of Rakuten is that you will have 100% control over page design to differentiate with other brands, and to market your brand.

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International Brands on Rakuten

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Rakuten will assign each merchant an account manager (“E-Commerce Consultant”) to provide regular feedback on store performance and make recommendations to continually improve month-over-month sales.

Merchant’s e-Commerce manager, director, etc.

• Business requirements• Strategic objectives• Branding

• Japan market knowledge• Store design suggestions• Merchandising guidance• Performance feedback• Conversion improvement recommendations• Marketing strategies• Promotional guidance

Rakuten’sE-CommerceConsultant

Our Support Staff

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Ongoing Support

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Case Study: Otterbox

“We perceived Rakuten before joining as not only the leading online marketplace channel for business in Japan but also that the platform allows you to have a branded page to communicate on brand rather solely on product.”

Patrick WallerDirector, APAC Marketing and eCommerce

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How Otterbox improved with Freddie the ECC

Case Study: Otterbox

Driving Traffic- Increase organic leads by setting an “entrance product”- Planned and executed revision of pricing, SEM, and encouraging

customer reviews. - Organic leads increased by 4 times by having search results appear on

the 1st page

Increasing Conversion RateFreddie asked around and gained information about what type of information the customers would like to see on Otterbox’s store. He also researched what competitors have been doing and advised Otterbox on points to improve.

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What customers will see when they search “Otterbox” comparison with other merchants from the search results

Case Study: Otterbox

- Regular use of advertisements to drive traffic- Thorough SEO to maintain top search results- Customer reviews, Super Points incentive, free shipping

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ProductEvents/Ads

Marketing

Strategies for Improving Sales

• R-Mail (mail magazine)• Press release• Affiliate• Customer reviews• Super Points incentive• Improving quality of page design

• Including “recommendations”• Advertisements, SEO• Events such as Rakuten Super SALE,

Shopping Marathons• Rakuten Super DEAL• Follow the Japanese calendar for

seasonal events/sales

• Sample/trial sets• Product branding• Prepare “entrance product”• Secure stock• Gift wrapping

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How you can sell with us

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Direct purchase of foreign goods from overseas companies, retailers, manufacturers and others by an individual for the purpose of personal use.

・　 International Mail

・　 International courier service

Delivery Methods

・ custom duty・ consumption tax・ a customs clearance fee

Note: The customs value of goods for personal use is “Retail price x 0.6”

Customs Fees

For goods at a total customs value of 10,000 yen or less will be exempted from taxation of customs duty and consumption tax.

\9,999.9 ÷0.6 = \16,666For total Cost below \16,666, tax will be exempted

Reference: Japan Customs 　（ http://www.customs.go.jp/）

What is Private Import?

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1 OverseasBrand

Service Partners

Japanese Customers

Fully Branded Store

Marketing

Local Order Management

Customer Support & Returns

Logistics/ Fulfillment

OverseasCompany

Brand Feed

Promotions

Purchase

Customer Service

Shipping Customs duty

Traffic &Demand

Cross-Border Sales Model: Service Partner Support

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Steps to Opening a Rakuten Store

①Speak with a Rakuten consultant

Speak with one of Rakuten consultants based in Rakuten U.S.A.’s San Mateo office. They can help you with any questions that you have about Rakuten, and introducing you to service partners.

E-mail & phone calls

Speak with one or more of our service partners to explore the services that they offer. Find a service partner that is right for you. Rakuten can always help by joining the conversations during this step.

Once the merchant has signed a contract with the service partner, the service partner will then proceed to take Rakuten’s screening.

E-mail & phone calls

Submit necessary documents

④Account Open on Rakuten

Service partner will begin setting up and designing the storefront.

Service partner will begin store set-up

②Speak with a service partner

③Sign with a service partner Rakuten screening

Grand Opening Day!

Mid-Late M

ayLate A

prilE

arly-Mid A

pril

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What should you do next?

Would you like to learn about more specific examples of merchants on Rakuten?

Are you interested in speaking with a service partner?

Still at an exploratory stage but would like to start exploring different opportunities?

Any questions?

Contact us! We would be happy to get in touch with you.

Reid Wegner: reid.wegner@rakuten.com