Japan is an attractive market for cross-border e-commerce

Japan is the world's third largest e-commerce market after China and the United States. However, it is often overlooked by foreign online shoppers due to an unusually low cross-border purchase rate and a somewhat insular strategy for online shopping.

Only 10 percent of Japanese consumers buy goods on foreign websites. Nevertheless, with a population of 126.5 million, a 93% penetration rate on the internet and 75% of those who make purchases online, Japan is an attractive market for cross-border online sales.

Research firm Statista estimates that Japanese e-commerce sales in 2020 will amount to approximately $ 100 billion, a decrease estimated due to global economic changes. An unpopular sales tax increase in 2019 also dampens consumer spending.

After a decline in the last quarter of 2019, the Japanese economy continued to shrink during the first quarter of 2020. Japanese consumers, once considered extremely brand loyal, are now more cost-conscious and show an increasing willingness to try new brands in their quest for bargains.

Japanese consumers online

  • Most Japanese do not read English or other foreign languages ​​and only buy from Japanese language websites.
  • Japanese consumers prefer detailed information about the product they are considering.
  • Forty-four percent use websites for price comparison.
  • Japanese consumers are avid mobile users. More than half of online shopping takes place on a mobile device.
  • While credit cards are the payment method for most online sales, Konbini's cash service store payment system is also popular with 50,000 locations across the country. Locally issued credit cards are much more popular than Western brand cards.

Japan is home to a rapidly aging population, but older people use the Internet at a level similar to younger people. Japan loses people due to low fertility, so it makes sense to target the older population – which makes up 28 percent of the total population.

Revenue opportunities exist for those merchants who can meet the needs of older consumers. For example, prepared meals are $ 20 million dollars and a fast-growing market with growth primarily attributable to the elderly, according to Statista. The Covid-19 pandemic has contributed to a proliferation in online sales of this vulnerable segment.


Three marketing platforms – Rakuten, Amazon and Yahoo Shopping – account for over a third of online transactions in Japan. Rakuten and Yahoo Shopping require non-U.S. Foreign companies who want to create accounts to start a local business or work with a local intermediary on their behalf.

Rakuten. Japan's largest revenue market has more than 100 million members and is strongest in fashion and food. US brands selling on Rakuten's platform have their own stores and product lists. They can also advertise through sponsored product lists and utilize other advertising features on Rakuten, such as coupons, newsletter ads and banner ads. Rakuten has its own fulfillment service called Rakuten Super Logistics.

Amazon Japan ranked first in website visits and sales. It provides a relatively easy way for foreign merchants with an Amazon merchant account to market products directly to Japanese consumers. Amazon requires all sellers to provide customer support in Japanese. Amazon handles fulfillment from Japan, but companies must have a Japanese company as an importer of record to handle customs.

Yahoo Japan Shopping is the e-commerce arm of the diversified web portal to Yahoo Japan, which is owned by Softbank and Alibaba and is separate from its US mother. Yahoo Japan Shopping provides a wide range of products including cosmetics, electronics, clothing and footwear, home appliances and furniture.

Zozotown is an extension of a mail order company, Start Today. It is the largest specialized e-commerce platform for fashion and footwear and offers products from many local and international brands. Yahoo Japan acquired a majority stake in Zozotown in 2019.

Qoo10. This online market has a broad portfolio of products in fashion, beauty, sports, digital, mobile, home environment, life, food, baby, entertainment and books, which is run as a joint venture with eBay, Qoo10 also sells in other Asian markets and is special strong in Korea and Singapore.

Wowma was founded by KDDI, one of Japan's largest mobile phone providers. The site offers more than 20 million products, including cosmetics, decorations, clothing, electronics and personal care services.

C2C marketplaces. Japan has a thriving consumer-to-consumer market that has expanded significantly in recent years. It consists of used marketplaces and online auction sites. The two major players are Mercari, which works via a downloadable application, and Yahoo Auctions. Rakuma is a C2C flea market application owned by Rakuten.

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