In 2015, the Japanese market scale of domestic B2C (business-to-consumer) retail ECommerce expanded to 120.5 billion euro (up by 7.6% from the previous year). Retail ecommerce market size of Japan is the fourth place in the world, following China, USA and United Kingdom. Market Scale of B2C EC of the past five years is shown in the figure below, continuing to expand EC market and the EC ratio.
Regarding to the ecommerce sales with smartphone in 2015
The percentage of distribution total via mobile at Rakuten market which is the biggest ecommerce site in Japan is already more than 50%. Estimated the market size of B2C EC via smartphone in product sales field, it became 17.3 billion euro. Shopping via Smartphone accounts for 27.3% of B2C EC market, 63.3 billion euro of product sales field.
The most popular category of the sales via smartphone is a “clothing-fashion goods, etc.” “Pharmaceuticals”, respectively about 40%. On the other hand, the “home appliances, AV equipment, PC · peripheral equipment, etc.” is about 20 percent, “food, beverages, alcoholic beverages” is 20% or less, has become a lower estimate than the other categories.
Home Appliances, because the price is high, it will be considered and consumers who want to buy comparing the price difference carefully on the PC.
For retailers, it is assumed to continue to be required develop strategy for mobile marketing.
Detail of retail ecommerce market
Product sales field was 63.3 billion euro in 2015 (up by 6.4% from the previous year). Services field, such as hotel reserve and restaurant reserve, was 42.9 billion euro in 2015 (up by 9.37% from the previous year). Digital field was 14.3 euro in 2015 (up by 8.09% from the previous year).
The growth of the retail ecommerce ratio
Retail ecommerce ratio in Japan 2015 is 4.75% (up by 0.38% from the previous year), EC is thus on an increasing trend and the computerization of commercial transactions continues to advance.
More than 1% of high growth category from the previous year is following;
- Life consumer electronics, AV equipment, PC · peripheral devices (up by 4.21% from the previous year)
- Books, video and music software (up by 2.2% from the previous year)
- Miscellaneous goods, furniture, interior (up by 1.25% from the previous year)
Possibility of cross-border ecommerce
On the other hand, we do not expect the growth of the entire domestic market. Japan’s economy has continued on slow growth. Japan’s population peaked in 2008, a decrease in population has continued. In 2025, over 30% of population will be over 65 years old, one in five people will be more than 75 years of age, Japanese society will be an aging society which we’ve never experienced.
Assumed to the situation of such future domestic market, companies think about the overseas expansion for future sales expansion. In e-commerce sector, government and JETRO which is a Japanese government-related organization that promotes mutually beneficial trade and investment, is actively supporting cross-border EC.
In 2015, the amount purchased through cross-border ecommerce by Japanese consumers from U.S. and Chinese business operators was 1.9 billion euro (up by 6.9% from the previous year), while that by U.S. consumers from Japanese and Chinese business operators was 7.9 billion euro (up by 11.1% from the previous year), and that by Chinese consumers from Japanese and U.S business operators was 14.3 billion euro (up by 32.7% from the previous year). Furthermore, the expected scale of cross-border EC among Japan, the U.S., and China through 2019 was estimated that in the U.S. by about 1.6 times, and that in China by about 2.9 times.
In the same way, also increasing the amount purchased of Japanese consumers at the EC-Site of the United States and China.
The amount purchased from United States and China in 2015 was 1.9 billion euro (up by 6.9% from the previous year), 1.8 billion euro from the United States (up by 6.9% from previous year) and 200 million euro from China (up by 6.8% from previous year). From the press release of The Ministry of Economy, Trade and Industry, the amount purchase of 2019 is expected to be 2.9 billion euro, one and a half times from 2015 to 2019.
For sales expansion, Cross-border ECommerce is expected development from now on why it is possible to make wider market without performing large investments such as opening store.
The retail ecommerce in Japan trend is following two point;
- The cross-border EC market may expand among Japan and overseas
- Active the purchase via mobile
Regarding to cross-border EC, Japan’s e-commerce sales are projected to increase almost 40% by 2018, a market total of over 175 billion euro. With a developed economy, small country size, highly urban population, and an exclusively uniform language, the Japanese market is attractive to online retailers.
The purchase via mobile ratio in Japan is one of the highest in the world among leading e-commerce countries.
The first place of ecommerce site share in Japan is Rankuten, Inc., the amount of overall transaction via Rakuten is 23.4 billion euro in 2015 (up by 10.2 percent from previous year), share about 20 percent of Japan’s overall E-commerce transaction amount.
In addition, distribution total to overseas consumer via Rakuten of 2015 increases 41%. To China 58% increase, to the United States has increased by 55%, it can be seen that the acceleration of cross-border transactions from Japan to overseas.
Rakuten is also focusing on overseas expansion, by the new partnership with opening flag shop on JD.com,No.1 EC site in China, they will promote cross-border trade, expand merchandise range over time.
The mobile strategy of Rakuten is putting a force on member acquisition via mobile app. Performs a personalized recommendation to membership in the mobile app, such as the distribution of coupons in accordance with the characteristics of the user. Omni-channel initiatives show future growth potential due to the country’s strong fulfillment infrastructures, especially as Japanese consumers become more comfortable with these solutions and cross-border shopping.