Retailers, let's face the challenges
of innovation together

10
jun
2020
Guillaume RIO
6 minutes
For several years now, we have been talking about the emergence of life platforms, whose worthy representatives are the GAFAMs and BATXs. However, if we have to look for the most successful platform, it is neither in the USA nor in China. The answer lies in Japan and is called Rakuten.

The Japanese platform continues to evolve and grow, which is why we are offering you an update of this June 2020 article, with data of November 2020.

The fact

While many of us in Europe know PriceMinister (renamed Rakuten France), behind it is Rakuten who bought it back in 2010. Rakuten is a Japanese giant with global ambitions (present in 40 countries) whose name is woven into the jerseys of FC Barcelona and the Golden State Warrior (NBA). Like Amazon, Alibaba and others, the Japanese giant has a veritable empire of services, operating in more than 70 different businesses including finance, health, distribution and telecoms. Rakuten has 1.5 billion members worldwide and is present in the lives of 90% of the archipelago’s 128 million inhabitants.

Rakuten does not want a heap of entities, nor a conglomerate, but a virtuous ecosystem that creates value. “Creating an ecosystem to serve our members is a very different vision from the traditional model of a global conglomerate. We are not just a collection of companies. We are passionate about creating a new, mutually beneficial environment in which our members, partners and businesses can all thrive.” Hiroshi Mikitani, CEO of Rakuten. Welcome to the service empire!

The decoding

The Rakuten empire was born from the will of one man, its president Hiroshi Mikitani, who in 1997 created the Rakuten Ishiba trading platform, which became the first Japanese e-commerce web site.

Very quickly Rakuten created a whole ecosystem of services focused on data and membership. The first brick was the launch in 2002 of ‘super points’, which are loyalty points combined with ‘cashback’, which encourages customers to consume regularly on the platform. To date (11/06/2020), more than 2000 billion ‘super points’ have been used since 2002, or more than 15.6 billion euros exchangeable even for bitcoins or ethers since the end of 2019 (against 1000 billion super points, or more than 8 billion euros exchangeable in June 2020).

The other matrix of the Japanese giant’s service-based ecosystem is membership, or more precisely the unique ID that allows members to move and consume in a fluid manner via the multiple Rakuten offers and services.

The Rakuten Ecosystem is present in all areas of daily life:

e-commerce with its main marketplace Rakuten Ichiba (10th world) and among others Rakuten France (ex Priceminister).

Rakuten Ichiba in order to increase its number of merchants on its platform, has deployed a complete offer of assistance to local trade ranging from payment methods (Rakuten Pay, Edy, etc.), optimized pick-up solutions (Rakuten ready), to the creation of its website…

Rakuten payAs in Japan, and more particularly during the 2nd lockdown, Rakuten France offers to help small traders via the Rakuten Academy. It proposes to be able to create its own site, to benefit from click and collect on its platform free of charge and a commission reduction to 5% (a decrease of more than 5O%) for the categories affected by store closures.

According to its CEO France Fabien Versavau in view of the crisis where only 25% of French retailers have an online business, the health crisis has led to an acceleration of consumption via online platforms. In figures, this translates into more than 40% opening accounts during confinement at Rakuten.’

Rakuten Academy

 tourism sector (Rakuten Travel, Rakuten Stay…)

Rakuten tourismeenergy sector: Rakuten supplies electricity and gas throughout Japan (Rakuten Denki and Rakuten Energy).

logistics, Rakuten Super Logistics has its own logistics fleet and recently, based on its own 5G network and in partnership with the Chinese JD.com, the latter automates its entire logistics process from the warehouse to automated delivery.

Rakuten livraison automatique

the banking sector (Rakuten Card, Rakuten Bank, Rakuten Securities), Rakuten continues to invest in this sector by developing the Bank (online banking), Rakuten Pay (payment system and mobile payment Line), Cards (credit card) and Edy (prepaid card) services. To date, the Japanese giant is the leading issuer of bank cards in Japan. In 2016, Rakuten launched its financial products on the European market (Rakuten Bank europe).

– in the healthcare sector, Rakuten Medical is a very advanced entity in cancer research. It recently launched an ‘Illuminox‘ platform in the field of cancer therapy and treatment. Rakuten Medical is also an international biotechnology company.

Rakuten Medical

the automotive and mobility sector with Rakuten Car, which among other things invested in Uber’s direct competitor Lyft. Rakuten Car also sells vehicles and offers a whole range of car-related services.

Rakuten car Lift

the digital media and content sector. Beyond the acquisition of the Canadian audio books platform Kobo or the Israeli messaging service Viber, the giant has created its own media Rakuten TV equivalent to Netflix or Amazon Prime in the USA.

Rakuten TV

In order to accelerate the delivery of its galaxy of services Rakuten has just launched its own MVNO (Mobile Virtual Network Operator) based on its own infrastructure while deploying its own 5G network. This 5G network will be hosted in its own cloud making it a virtualized radio access network (vRAN), a world first. Using less physical infrastructure than its competitors (NTT Docomo , Softbank, KDDI,) Rakuten will offer packages at very low prices. As the owner of its 5G network, Rakuten’s ambition is to offer in the short term a real service package, of which the mobile package could be the entry point.

Rakuten brand membership

If since 1997 the Japanese giant has developed on an extreme attention paid to the customer through its marketplace (Rakuten Ishiba), it is closer to the life of the citizen day after day: Since we started with an online marketplace more than 20 years ago, we have constantly progressed towards realizing a vision of an ecosystem for Rakuten members – a virtual marketplace of products and services that would empower the lives of our members, offering them convenience and multiple other benefits when shopping, banking, traveling, connecting with others, etc.’ Hiroshi Mikitani, CEO of Rakuten.

Rakuten now has the means and very clearly the will to centralize all our daily data. Rakuten, behind its membership, has everything to offer “life packages” that will encompass all our daily desires, i.e. “the industry of life”.

Guillaume RIO
Specialist of BATX & GAFA ecosystems and passionate about China, Guillaume analyzes the impact of new technologies on our lives.
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