Insights Into Japan’s eCommerce Market

By Elizabeth Wormald

Japan ranks fourth globally in eCommerce sales. So what does this mean for you? If you are looking to begin selling in Japan, eCommerce is an ideal place to start. According to a 2017 report by the Ministry of Economy Trade and Industry (METI) B2C and B2B eCommerce have been growing steadily.

The B2C eCommerce market grew by 9.1% in 2017 making it worth 16.5 trillion yen. Within B2C eCommerce the two largest sectors of consumer goods growth were in furniture/interior design goods and stationary/office goods which saw 9.85% and 8.2% in growth from 2016 respectively.

The B2B eCommerce market also saw an increase, growing by 9% to 317.2 trillion yen. Moreover, there has been a rapid increase in C2C eCommerce, with the net auction market being worth 1.1 trillion yen.

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The METI report placed particular emphasis on free-market apps which are now worth just under 500 billion yen only 5 years after their establishment. In short, the market is booming and there are several platforms which are ideal for hosting foreign companies.

Shopping platforms

The three biggest shopping platforms in Japan are Amazon, Rakuten and Yahoo! Japan Shopping. A recent report claims that Softbank, Yahoo! Japan and retailer Aeon will be joining to launch a new online shopping platform.

This partnership could be a threat to the current market share rankings. Japanese consumers are more open to foreign brands, businesses and platforms than ever before; becoming more like their western counterparts placing a higher value in financial savings. The demand for next-day and same-day delivery services have also increased, in Japan, the customer always comes first whether that’s seasonal packaging or delivery within 24 hours.


Whilst consumers have favoured Japanese platforms in the past, according to a 2016 JETRO report Amazon pipped Rakuten in market share at 20.2% by just 0.1%. Amazon Japan is easy to use, offering a quick 15 minute registration with Seller Central being supported in 7 languages including English.

Amazon offers a fulfilment service, removing concerns over arranging a Japanese delivery provider, they also offer a range of payment options to customers and an option for sellers to be paid in their local currency through the Amazon Currency Converter for Sellers.

Download our report for tips on selling on Amazon Japan.


Rakuten is an incredibly popular shopping platform in Japan, being used by 70.2% of online consumers. The platform ranks second in market share at 20.1%. In order to compete with Amazon, Rakuten has launched a variety of new strategies including a grocery service and partnership with Bic Camera.

Rakuten, whilst not as visually appealing as Amazon, focuses on customer shopping experience and is thus fixed in the consumer mind through brand recognition, loyalty and trust. Rakuten’s selling platform is not as accessible to foreign companies, but check out our webinar and you can quickly learn the ins and outs of this eCommerce giant. In a more positive move for UK sellers, Rakuten recently changed their company language to English, making it more accessible and competitive.

Check out our recorded webinar for everything you need to know about selling on Rakuten.

Yahoo! Japan Shopping

Yahoo! Japan remains a relatively popular media company, however, the shopping platform has fallen to 3rd place in the eCommerce market at 8.9%. In an attempt to curb this decrease in market share Yahoo! Japan undertook a new strategy in 2013 moving the business model from fee-based to ad-based revenue.

In 2017, to improve their relationship with customers, the company decided to offer loyalty perks through a boosted point system, including partnerships with one of Japans leading mobile networks SoftBank. Yahoo! Japan Shopping sellers pay no initial fee, system usage fee, or loyalty fee, the only payment sellers make are to T-Point- a Japanese loyalty card.

Apparel Platforms

According to the 2017 METI report, clothing made up 11.5% of the online consumer goods market. Comparatively, the UK online fashion market was said to be 17.2%. Whilst UK giants ASOS and are yet to gain traction we are seeing similar styles of websites emerge.

The online-mall framework is most popular in Japan, where hundreds of brands are available in one place. Japanese online retailer Zozotown focuses on aesthetics; using celebrated brands, well-organized displays and editorial selection. It is important to note that aesthetics and garment presentation are very important to Japanese consumers.

The UK has a more advanced online apparel market, so it should be easier to penetrate the Japanese market through innovative branding and presentation.

Free Market App Platforms

The 2017 Ministry report placed emphasis on C2C markets, particularly the rapid growth of net auction sites. In 2017 free market applications were worth 483.5 billion yen, an enormous increase of 58.4% on 2016.

This dramatic growth is likely to continue, looking to be one of Japan’s most lucrative markets. Japan has recognised the value of net auction websites, with METI siting American giant EBay’s double in value over 10 years as proof of economic promise. Mercari, Japan’s first tech start-up unicorn and home-grown answer to eBay, filed to go public in 2018.

The company was valued at over 109 billion yen in 2016, a figure which is considered to have doubled in 2018. The flea-market style company focused efforts on mobile usage; a strategy reflected in the app reaching over 100 million downloads worldwide in 2017.

Handmade Product Platforms

Whilst in the UK there are just a handful of well-known platforms, such as Etsy, which sell hand-made products. In Japan, there are around 40 major platforms in the handmade marketplace, the top 4 being Minne, Tetote, Ichi and Creema. The market doubled in 2014 from 3.5 billion to 7.8 billion yen, showing a great potential for further growth.

Established in 2010, Creema is home to over 60000 registered creators, listing over 2.4 million handmade items. The company received 1.1 billion yen from Globis Capital Partners in 2016 following a separate 100 million yen contribution in 2014 from KDDI.

It is reported that in 2016 Creema saw a 450% growth in transaction volume from the previous year. The online handmade market has made incredible progress in Japan, showing customer’s interest in one of a kind high-quality products at an affordable rate.

Payment Methods

As a foreign trader, it’s necessary to understand not only Japanese spending habits but also the methods favoured by customers. Japan’s preferred method of payment is credit card, however, there are some less familiar methods that retailers may wish to offer to ensure customers feel comfortable making a purchase with your company.

Many unfamiliar payment methods revolve around Japan being a cash-based society. Customers often prefer handing over cold hard cash than letting their digital money zip across the world. Bank Transfer- remains a popular choice. As debit cards are not widely used in Japan, bank transfer is the most direct form of payment. Cash-on-Delivery- usually performed through Yamato or Sagawa shipping carriers, allows a customer to pay at the door when they receive their goods.

According to Amazon Japan, 43.8% of customers use COD when online shopping. Convenience Store Payment- after ordering a product online, within 6 days the customer brings a receipt number or QR code to a convenience store and is able to pay with cash. Upon completion, the products are sent to the customer, or can even be delivered to a convenience store for those with a busy schedule.

Tips for eCommerce in Japan

  • Though brand name and quality have long been considered the most important features for Japanese consumers, global economic trends have led to a prioritization of valuable goods.
  • Though once biased in favour of Japanese platforms and products, more customers are looking for foreign companies to save money and to find unique products. In response, companies such as Rakuten and Amazon Japan are working to accommodate foreign sellers.
  • Consumers tend to use online-mall style platforms and are attracted to C2C handmade markets.
  • The physical presentation of the product should be excellent. Customers in Japan care about presentation.
  • Though once the home to HTML style shopping sites, Japanese consumers now appreciating branding and presentation of their platform. Think high-quality design and subtle aesthetics.
  • With over 99% of the population speaking Japanese, in-depth translation and localizations are necessary. Japanese shoppers need to trust the seller, and details about technical specifications, fabrics and measurements are essential.

Additional Resources

Recorded Webinar: Introduction to eCommerce in Japan

Exclusive Report: eCommerce in Japan


Mercari, Japan’s first unicorn, files for $1.1B Tokyo IPO


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