‘Rakuten, the Japanese Amazon.com’
Have you ever heard of Rakuten? Personally, I did not know Rakuten before writing this blog. It is Japan’s largest e-commerce site and a provider of Internet-based services. The company has 80 million users and it is one of the oldest and largest e-commerce companies in the world, with a market capital of $ 13.5 billion and an annual sale of $4 billion (Akhtar, 2013). Rakuten is founded in 1998, is currently operating in 20 countries and is called the ‘Amazon of Japan’ (Akhtar, 2013).
The company has been working to expand its operation beyond Japan through a lot of mergers & acquisitions. Some examples are the acquisition of Buy.com for $250 million in 2010, the Canadian e-book reader company Kobo in 2010 and the Spanish on-demand streaming video service Wuaki. All these companies are acquired with the goal to compete with the e-commerce market of the U.S. (Akthar, 2013).
Furthermore, Rakuten announced to acquire Ebates.com for $ 1 billion (Perez, 2014) last week. Ebates.com is a website which rewards customers with cash back while they are shopping online through one of the Ebates’ platforms. Ebates has over 2600 partners, including Amazon.com, Macy’s and Home Depot (Perez, 2014). The acquisition of Ebate gives Rakuten another access point to the growing e-commerce market of the United States.
The above examples illustrate that Rakuten is willing to compete with Amazon.com. However, Erika Morphy, a critic, claims the contribution of Rakuten to the e-commerce industry will not be an innovation but rather a globalization. Her argument is that Amazon does not have to be afraid of Rakuten’s entry into the e-commerce market of the U.S, they should rather have concerns about what this entry represents: globalization (Morphy, 2014).
I am not wholly convinced by this statement, and I believe Rakuten is becoming a huge treat for Amazon since more acquisitions are scheduled. Furthermore, it is scheduling to operate from San Francisco within some months. What about you. Do you agree with Morphy’s statement or do you believe that Rakuten will take over the leading position of Amazon?
Akhtar, O. (2013) Rakuten: The biggest e-commerce site you haven’t heard of, Available at: http://fortune.com/2013/03/22/rakuten-the-biggest-e-commerce-site-you-havent-heard-of/, [Accessed 22 September 2014]
Perez, S. (2014) Rakuten Buys Ebates for $1 Billion, Available at: http://techcrunch.com/2014/09/09/rakuten-buys-ebates-for-1-billion/, [Accessed 22 September 2014]
Rao, L. (2013) Watch Out Amazon, Japan’s Rakuten Buys E-commerce Fulfillment company Webgistix to Expand Further in the US, Available at: http://techcrunch.com/2013/06/05/watch-out-amazon-japans-rakuten-buys-e-commerce-fulfillment-company-webgistix-to-expand-further-in-the-us/, [Accessed 22 September 2014]
Morphy, E. (2014) Look out Amazon, Here Comes…Rakuten?, Available at: http://www.forbes.com/sites/erikamorphy/2014/09/09/look-out-amazon-here-comes-rakuten/, [Accessed 22 September 2014]