Table Of Contents

WHY SELL IN JAPAN? 1

WHAT TO KNOW BEFORE YOU GET STARTED 2
Customer Expectations and Behavior In Japan 2
1. Customers Expect Lower Prices Online 2
2. Customers Expect Fast, Flexible Shipping 3
3. Customers Expect Transparency 3
4. Customers Expect Detailed Information 4
5. Customers Expect To Be Rewarded For Their Loyalty 4
User Experience In Online Shopping In Japan 5
1. Customers Favor Dedicated Digital Storefronts 5
2. Customers Want To Be Able To Shop On Their Mobile Devices 6
3. Customers Want To Shop On Trusted Platforms 6
4. Customers Expect Exceptional Customer Service 7
5. Customers Favor A Busier Look 7
Laws and Regulations in Japan 8
Taxes in Japan 8
Global Shipping VS. Warehousing 9

WHAT ARE JAPANESE CONSUMERS BUYING? 10

Fashion & Athleisure 11
Beauty & Cosmetics 12
Supplements 13
Sports & Outdoor 13
Electronics 14

RAKUTEN: JAPAN’S LARGEST ONLINE MARKETPLACE 15

It’s A Straightforward Process To Get Started 15
It’s Packed With Amazing Features 16
It Has Everything Your Customers Want 17
It Has Everything You Need As A Seller 17
It Has a Built-in Loyalty Program 18
Rakuten is The Full Package 19

SOURCESplace 20
No matter what it is that you plan on selling,
expanding your customer base outside of the
US doesn’t have to be difficult. In this guide,
we’re going to cover everything you need to know
about selling in Japan; one of the most readily
available markets worldwide.
This comprehensive guide is created by IGW to
illustrate what you can expect when entering the
Japanese marketplace. It describes Japanese
customer expectations, their online user habits
and the regulations you will encounter as a seller
in Japan. This guide will also explain and help you
use Rakuten, Japan’s largest online marketplace
to reach your sales goals.
To be successful in selling in Japan, a solid plan
and well thought out strategy is required to make
that goal into a reality. The plan should cover
research on the Japanese market and its potential
customers, the best methods available to ship
your products and a thorough review of Japanese
regulations. This information and the resources
available from the Rakuten eCommerce shopping
platform will position for success in selling to Japan.
Why Sell In Japan?
Japan has a lot to offer sellers from all areas of the world. It
is often believed that Japan is a hard market to penetrate
because of the differences in language and culture; however,
there are a multitude of resources available to help overcome
any of those perceived barriers. American businesses, in
particular, can be quite successful in selling in Japan and with the
right strategy the process of selling in
Japan can be easy and painless.

Japanese consumers love American products. This is a concept

that reaches as far back as the 70s. At that time, one of the
biggest fashion staples in Japan was American-made clothing.
Even though times change, the influence of American fashion on
Japan has only grown stronger over the years. The demand for
American products reaches far beyond apparel, too. Buying from
international brands is often seen as a symbol of status. On top
of that, American products are synonymous with quality.
Japan offers a customer base that is excited about buying
American products. The Japanese love buying online and
have grown to become the fourth-largest eCommerce market
worldwide.
In 2019, the total market value was $186.7 billion. Predictions
show that the market will continue to grow; the projected
Compound Annual Growth Rate from 2019-2023 is as high as 8%.
Japan has also had the highest digital buyer percentage in the
region for a few years running.
There is also a high internet penetration rate in Japan, coming in
around 89.8%; the Internet usage rate by device for smartphones
is 63.3% which is 12.9 points higher than for computers 50.4%.
Online shopping has been steadily trending upward since then
and was drastically accelerated in 2020 because of COVID-19,
surging by over 50%.
eCommerce is booming in Japan and international brands are
very well-loved. Further, Japanese consumers have a track
record of being fiercely brand loyal when identifying a
product that meets their expectations. Product return rates
are historically low and there are several factors Japanese
consumers tend to prioritize over price.
Japan is one of the best markets to target for global expansion.
Choosing a platform like Rakuten can assist in making the
expansion smooth, transparent and successful.

eCommerce
20%
purchased from
a foreign website

111.4
registered
members

27% 80%
of the market of the population

When it comes to eCommerce, Rakuten outperforms several
other popular platforms and holds onto roughly 27% of the
market. There are over 111.4 registered members, which
accounts for as much as 80% of the population.
A marketplace like Rakuten may just be the key to getting in
the door. PayPal mCommerce Study reported that only 20%
had purchased from a foreign website. This shows that using
a localized marketplace that these shoppers trust is going to
be a vital part of your success.

1
What To Know Before You Get Started
Background knowledge of the Japanese market is critical
to a business’s success in selling to Japan. Businesses
making a big shift in their strategy, want to make sure
they are thoroughly informed to make the most effective
strategic decisions to advance towards their goals. As is to
be expected, there are going to be some cultural differences
between American and Japanese consumers; and there are
some distinct technical differences between domestic and
international selling and shipping.
The following section covers the top things a business should
know before you get started selling in Japan.

CUSTOMER EXPECTATIONS
AND BEHAVIOR IN JAPAN
The largest portion of the Japanese economy is made up of
middle-class consumers that have a considerable amount of
disposable income, which is one of the primary reasons why it is
such an attractive market for businesses with global expansion
plans. One of the largest differences in Japanese shoppers and
an existing American customer base is culture, which can often
pose challenges to breaking into the market.

One of the best things that a business can do to help bridge

that cultural gap is to understand what Japanese customers
will expect when choosing an American made product.

1 Customers Expect Lower Prices Online

One of the biggest reasons that Japanese
consumers like to buy internationally is
that foreign brands often offer better
prices. While it is true that there are
multiple contributing factors in product
selection and brand loyalty that are more
important than price, offering competitive
pricing is a must. It is also expected that
products will be available cheaper online.
This is especially important for resellers
of national branded items who will be
competing with a variety of other sellers.
with different stores located close
together. This is extremely convenient
for consumers and can be more
favorable than waiting for something
to ship. This means that a lot of online
retailers in Japan must keep their prices
low to incentivize online shopping.
Japanese consumers are also more
likely to use price comparison tools than
their American counterparts, which
forces Japanese products to be priced
competitively online.

In the United States, about 70% of
products are the same price online as
they are in a physical retail store and
only 22% are cheaper online. However,
45% of products can be purchased for
a lower price online than they can in
stores in Japan.
Several factors contribute to this. In
Japan, cities tend to be densely packed,
Japanese consumers look for things like
product quality, product features, and
overall value of a product more than
they look for low prices; however, it is
important to remember that they are
used to things being more affordable
online as well as when purchased from an
international brand. Knowing this can help
companies price their products effectively.

2
 2 Customers Expect Fast, Flexible Shipping
Japan is a very small country,
geographically speaking. This
means that most retailers can offer
same-day and next-day deliveries.
Japanese consumers are used to fast
shipping but there is a lot of evidence to
demonstrate that they are willing to wait
for international shipping as long as the
products meet their expectations. This is
further accentuated when they approve
of a brand and when they have a positive
online shopping experience.
Although fast shipping is a critical
factor in Japanese customers’ purchase
decisions, the most important thing is
that shipping is flexible. Most Japanese
consumers are used to being able to
customize their delivery dates and times
so this is something that they have come
to expect, no matter where they’re
shopping from.
Sellers must ensure they have a range
of flexible shipping options that will
allow shoppers to customize when their
products will arrive. This will help them
make sure that they’re home to receive
their deliveries or they can get it faster if
they need it sooner.
Fortunately, this is something businesses
can handle regardless of the shipping
location, whether that is domestically in
Japan through a warehouse or globally
from a stateside warehouse.
Providing a range of shipping
options is easy on a platform like
Rakuten, which has a range of
options built right in. This high rate
of customizability is a perfect way
to meet customer expectations and
prove you are dedicated to providing
your products at their convenience.

3 Customers Expect Transparency

In 2020, Edelman Trust Barometer
Japan Results shows that Japan ranked
in the 7th lowest among 26 countries
when it comes to trusting businesses.
This means that Japanese customers do
not take marketing messages at face
value and that they may be skeptical in
their purchase decisions.
This isn’t an impossible hurdle to
overcome, but a business must show that
they are dedicated to the transparency
that these consumers demand from
international brands. One of the primary
ways that you can do this is by selling
through a trusted marketplace like
Rakuten.
One of the persisting trends among
Japanese consumers is that user reviews
are more important than any expert
insight. A great way to help build trust
among your brand is to make sure that
customer reviews are accessible and that
they’re properly translated so that other
Japanese shoppers can read them when
making their selections.
Ranking lists of products can help
showcase what others have previously
purchased. Japan is typically not as
individualistic as America so these
shoppers will be interested in what
products their peers have purchased and
what they’ve had to say about them.
Research has also shown that Japanese
consumers want to know how to return
a product. Return rates are astoundingly
low compared to the US; those rates are
just 3% in Japan as opposed to up to 30%
in America. However, most brands in
Japan don’t offer as much transparency in
this area compared to American brands.
Make sure to include this information in an
easily-accessible way as well.

3
 4 Customers Expect Detailed Information
Assurance is something that Japanese
consumers demand when it comes to
shopping online. Japanese customers
diligently research before making a
purchase. Because of that, having
detailed information about your brand
and your products is going to be critical
to your success.
Your product listings should include
robust product descriptions, list
features, purchase options, dimensions,
product reviews, and more. The more
information provided, the better.
Japanese people are very careful
shoppers, especially in comparison to
consumers in other parts of the world.

You can expect a Japanese consumer
to research your brand or shop directly
before making a purchase. You can
use this to your advantage by including
detailed product description in your
listings. Price and convenience are not
the sole motivators for shopping online
in Japan, so these shoppers are going to
have great attention to detail. Therefore,
it is important that you provide details
that fully explain your product offerings.
One way to ensure that as much
information as possible in the
product description is to use an online
marketplace. A platform like Rakuten
allows you to do custom product
pages that appeal to targeted
customers. Ensure everything is
appropriately translated also helps
to remove any potential stumbling
blocks on the shoppers’ path from
consideration to the final purchase.

5 Customers Expect To Be Rewarded For Their Loyalty

Japanese consumers have a history of
fierce brand loyalty when they find a
product that meets their expectations.
Japanese consumers expect to be
rewarded for their loyalty and taking
this into account can help you drive your
success in the long run.
Almost half of all Japanese consumers
choose to buy from a specific website
based on the presence of a rewards
system. According to this particular
survey, this was the most significant
factor for shoppers, right behind the
variety of products available.
Most rewards structures are based on
a points system that allows shoppers to
earn points towards discounts with every
purchase. This practice is successful
because it draws in customers and
incentivizes them to keep coming back.
This builds on the brand loyalty you are
working to build with customers.
This is another place where Rakuten
shines. Rakuten has a built-in system that
can link directly to shoppers’ credit cards
that you could choose to take advantage
of as a seller on the platform. This point
system is one of the contributing factors
to Rakuten’s widespread success in Japan.
Some type of rewards system has been
in place on Rakuten since as far back
as 1998; however, the current iteration
has been around since 2002. It is called
Rakuten Points and it is a massive reason
that so many consumers have remained
on the platform. Rakuten Points offers
buyers an extra motivational boost to
shop on the platform, and sellers have
the opportunity to help provide extra
incentives for buying their products.

4
USER EXPERIENCE IN ONLINE
SHOPPING IN JAPAN
Even the way that Japanese people use the internet has distinct differences from
the way that Americans do. Internet usage penetration in the United States
sharply drops off after the age of 50 and that is not the case in Japan.

Internet Usage Penetration By Age Group In Japan:

In addition to the differences in user base, there are some
differences in preference as well. Japanese consumers actually
favor direct communications about products and sales through
email whereas the majority of American consumers consider
these to be annoying. Without a physical store that customers
can walk into, it is important to recreate a personally tailored
experience in a digital format.
User experience is one of the most important things businesses
should consider when selling anything online. A business
that falls short in terms of providing the experience that
customers expect, will be considerably less successful in the
online shopping experience.

1 Customers Favor Dedicated Digital Storefronts

Japan’s entire retail system tends to
focus on individual stores. This is true
when it comes to eCommerce in Japan
as well. Because Japanese consumers
seek out detailed information and want
to get to know the brands they’re buying
from, dedicated digital storefronts are
much more popular among shoppers as
opposed to simple product catalogs.
Implementing an indvidiual store can
benefit a seller by providing a dedicated
space for customers to get to know
a brand and products will help gain
their trust. This provides the space and
opportunity to provide the information
consumers expect and allows you to
completely cater the experience to them
as a shopper.
A seller can use this space to share
information about shipping, returns,
and any other policies. This added layer
of transparency will help put Japanese
shoppers at ease if they’re unfamiliar
with your brand.
The dedicated storefront feature is built
right into Rakuten. The platform gives
you the space to create a storefront
full of information and even allows you
to have dedicated product pages that
go into more robust detail about the
product. It is one of the reasons why
Rakuten holds the largest market share
in Japan. In fact, it is home to almost
50,000 different unique online shops.
Websites with this structure provide
sellers with greater success than those
that simply function as a catalog.

5
 2 Customers Want To Be Able To Shop
On Their Mobile Devices
Mobile phone use is the most widespread
form of internet use in Japan. Japan
is sometimes referred to as the most
mobile nation worldwide with some
sources purporting that there are as
many as 173 million mobile connections
throughout the country. That’s greater
than the country’s population!
With this in mind, it is critical to ensure
the chosen online marketplace is
completely mobile-friendly. The platform
should provide fast-loading images,
appropriately-sized buttons for use on a
touchscreen, and a site that is completely
optimized for mobile users in order to
make the most of selling in Japan.

Research shows that as much as 73% A business can invest in mobile

of Japanese consumers have bought
something on their mobile device at
least once. Recent data also states that
close to one-quarter of all eCommerce
sales take place on mobile devices. The
majority of Japanese fashion sales take
place through mobile devices. Conversion
rates are also as much as 10% higher
on mobile devices. Even older Japanese
consumers trend towards mobile
shopping.
optimization on their own site or they can
choose to use an online marketplace that
comes with a fully-kitted mobile platform
allowing them to reach more shoppers.
Rakuten has a dedicated mobile app
that boasts millions of downloads from
shoppers all over the world.

3 Customers Want To Shop On Trusted Platforms

As mentioned, trust is huge in Japan.
There is a lot of skepticism among
Japanese consumers; which means
that less than a third of shoppers are
comfortable purchasing products
from a foreign website. So, even though
international brands are well-liked and
even more desirable than some Japanese
products, the platform can still be
a hurdle.
There are a lot of options when it comes
to selling in Japan. Many brands choose
to set up dedicated websites, for instance.
There are also multiple platforms that a
business can choose from that already
have large user bases in Japan. Rakuten is
the one with the largest user base, the
largest market share in eCommerce, and
the highest monthly active users.
Japanese consumers tend to favor
Rakuten over other platforms; 80% of
the Japanese population uses the site
for shopping online. There are also a lot
of different features that make it more
desirable among consumers.
Choosing a trusted platform to get
started selling in Japan can be one of the
most important foundational steps that a
business can take as they expand globally.
This is especially true for businesses that
do not have a lot of brand recognition.
In this case,it is very helpful to have the
support that comes along with using a
platform like Rakuten and sort of a built-in
customer base that will start exploring
and eventually purchasing your products.

6
 4 Customers Expect Exceptional Customer Service
Being polite is extremely important in
Japan. Japanese culture is deeply rooted
in etiquette and respect. Things already
touched on like customizable delivery
dates, clearly outlined policies, and even
generally working hard to meet the
expectations and needs of your
Japanese customers are all part of
providing great service.
Having an easy-to-navigate site on
desktop and mobile, providing reviews
for potential customers to read, and
thoughtful and thorough product
descriptions will be critical to Japanese
ecommerce success. Customers should
have a way to get in touch with you to ask
questions or voice any concerns. It is also
important to make sure to have someone
who is completely proficient in Japanese
to help you when dealing with customers
that may not speak English.
Exceptional customer service comes down
to making sure the entire experience is
catered to the customers and that you
treat them the way that they expect to
be treated. Focusing on the little things to
help make their online shopping with your
brand more convenient is going to help
elevate their experience.
Rakuten provides sellers with great
support in the forms of expert training
and guidance and with outreach and
communication tools built into the
platform. There is also the Rakuten
Worry-Free Guarantee to help protect
customers and provide them with
assistance in handling their claims,
which helps bolster the popularity of this
massive online marketplace.

5 Customers Favor More Content

Minimalism has been on-trend in America
for years now. This simplistic look is
favorable to American consumers so it
may surprise you that the exact opposite
is true in Japan. Instead, Japanese
customers have a strong preference
for very rich and vibrant imagery, busy
designs that are packed with information,
and very little whitespace.
Very image-heavy and text-heavy pages
may not be something that you are used
to as this is typically seen as off-putting
and even overwhelming to your existing
customer base. However, the use of a lot
of images and text on your product pages
is going to be something that is essentially
required in Japan. These consumers
want detailed information and extensive
illustration while doing their online
shopping.
In fact, designs that are “too minimal” by
Eastern standards may end up making
your offering seem untrustworthy to
potential customers. This is especially
important when first breaking into the
global market and getting started selling
in Japan. It gives shoppers an easy way
to start to get to know your company,
recognize your brand, and understand
your products.
The ability to create custom product
pages for each individual product that
you sell on Rakuten makes this a breeze.
Rakuten offers the ability to focus each
page on the right keywords to come up
in searches, the in-depth features of the
product that provide value, and bring
products to life on their screens.
The most important thing about setting
up pages to cater to your Japanese
customers is to be diligent about
picking the best photos, making sure
everything is properly translated, and
creating an entirely new design that fits
their tastes and grabs their attention.

7
LAWS AND REGULATIONS IN JAPAN
It should not go unmentioned that complying with all of the
laws and regulations when it comes to selling products online
is absolutely mandatory. Depending on what those regulations
are, being non-compliant can lead to steep fines and even
criminal charges. It is important to understand the local laws
and regulations as well as any taxes that apply prior to
selling in Japan.
Depending on what a business is offering to the Japanese
consumer, there are some national laws and regulations in
Japan that are helpful to be aware of.
A non-exhaustive list from the Japanese External
Trade Organization includes:
• The Food Sanitation Act
• The Electrical Appliance and Material Safety Act
• The Household Goods Quality Labeling Act
• The Consumer Product Safety Act
• Technical Regulations Conformity Certification
for Radio Equipment
• The Pharmaceutical Affairs Act
TAXES IN JAPAN
Another thing to understand before selling in Japan is how
taxes will work. If a company chooses to warehouse products in
Japan for distribution, the company is responsible for hiring an
importer to obtain all the necessary legal paperwork to have the
products commercially imported to Japan and tax must be paid
when inventory arrives in the country.
When a customer purchases products directly from overseas
sellers shipping internationally, Import Tax may be charged
when the items arrive in Japan depending on the order value.
Items shipped directly to the customers from an overseas
warehouse each time they make a purchase are considered as
personal imports; they are either exempt from duty and tax
when the order is under ¥16,666 JPY ( $150 USD) or are subject to
personal import tax each time something crosses the border into
Japan and arrives in customs. This cost falls on the consumers
in Japan. When your customers receive your products, they will
have to pay cash on delivery to cover this tax.
8
Japan’s Customs and Tariffs Bureau also provides a list of
import-related laws and regulations that apply on a national
scale. Comprehensive resources like Lexology’s resource explores
the current legal and regulatory framework of eCommerce
in Japan; and Japan’s Manufactured Imports and Investment
Promotion Organization or MIPRO, which is an organization that
has spent the last fifty years acting as a resource to foster the
growth of imports and investments in Japan. MIPRO has a Guide
to Safety Assurance for Products Imported to Japan that covers
a wide variety of commerce regulations.
Each locality in Japan might have different laws and regulations
as well. Diligent research is key to ensure compliance. An
important note: Only official translations of any laws or
regulations are going to be legally binding. Keep this in mind and
make sure that you are getting the most current and
correct information.
It is also critical to understand that everything imported to
Japan is required to arrive with proper documentation. The three
main documents that you will be required to include are a Bill of
Lading, a Packing List, and a Commercial Invoice. You can find a
full explanation of these documents on the website for Japan’s
Customs and Tariffs Bureau.
Import Duty is separate from the Consumption Tax but may be
referred to by several other names like import tax, import tariff,
customs duty, or just tariff. This amount can be up to 20% of the
value of your goods; however, the average rate is just around
5% and can be even lower on some products. The customer is
responsible for these fees.
For companies that choose to establish a Japanese entity to
sell their products, these costs would become the organization’s
responsibility. Most of those sellers build this cost into the price
of their products. This is a common practice and it is almost to be
expected by international shoppers; however, it should be kept in
mind that lower prices are more competitive.
GLOBAL SHIPPING VS. WAREHOUSING
Another detail to consider before selling in Japan is shipping.
Two main options exist when it comes to how you plan to
fulfill orders.
The first option is cross-border shipping. Products take a much
less direct route to customers this way and will take significantly
longer to arrive. Orders received in this manner must be sent
out through an international courier service. It would then be
processed by an international courier service agency and sent
through Japan Customs. Once Japan Customs grants an import
permit on the shipment, it would be passed off to a Japanese
courier for last-mile delivery.
When an item is shipped this way, a customs broker may handle
things like putting the shipment through customs and paying any
required customs duty on behalf of the company; the company is
then required to pay this broker anything owed. However, this is
all typically handled by a logistics company, of which would have
been set up previously. If you choose an international courier
service, you will not need to worry about a customs broker.
A wide range of factors must be considered when choosing a
warehousing solution. Here are some key questions to consider:
What types of products are you shipping?
Are they easily warehoused?
Are you both willing and able to
handle fulfillment on your own?
Does your sales volume make
cross-border shipping excessively costly,
inefficient, or otherwise unmanageable?
Does your sales volume make
cross-border shipping more
cost-effective?
Shipping products across the border would allows a business to
choose if you or the customer are subject to the customs fees,
you don’t have to register your products in Japan, and you will
not be required to translate labels; however, this takes much
longer and may not prove to be as cost-effective when you
consider the long term. It is the most cost-effective solution for
anyone who wants to start selling in Japan, though.
Without data to support a product’s sales volume, warehousing
poses a larger risk for anyone who is just starting to sell online
9
The other option is in-country warehousing. In this example,
products are stored at a warehouse in Japan as you wait for
orders to come in. This can be the better of the two options
because Japanese consumers are used to extremely fast
shipping because of how relatively small the island is. Same-
day and next-day shipping are often the standard and having
products already in Japan can help ensure same fast shipping
times as your potential competitors.
Two warehousing choices exist: an independent warehousing
solution that meets your needs or warehousing and shipping
services that are offered by the various online marketplaces
in Japan. One key benefit of choosing in-country warehousing
is that things like tax and duty may be more manageable this
way, however you would have to pay these costs instead of your
customers.
Although some businesses find warehousing favorable, most
consider it to be cost effective to choose cross-border shipping
when first getting started.
What are the storage costs going
to amount to?
How do the storage costs compare to your
estimated taxes on individual imports?
How quickly do similar products deliver?
How will the shipping time impact
your product?
Does the size/weight of your products make
cross-border shipping excessively costly,
inefficient, or otherwise unmanageable?
in Japan. Warehousing products will result in faster shipping and
could potentially help you lower costs, but requires the need to
work with a marketplace that has the appropriate framework
in place or find your own importer. This is definitely a more
long-term solution that is best-suited for experienced sellers.
There are advantages and disadvantages to each option and
the right one for your business is going to heavily depend on your
answers to the questions above.
What Are Japanese Consumers Buying?
Japanese consumers shop online for a variety
of reasons and they buy an incredibly diverse
range of products. Shopping from international
sellers allows them to access products that aren’t
typically sold in Japan, access more variety, and
benefit from lower prices. People buy everything
from gifts to groceries, from furniture to fitness
gear, and beyond when shopping online.
The Japanese eCommerce market
is broken up into three major
categories which are retail, services,
and digital content. Retail is the
largest category and accounts for
more than half of all eCommerce
purchases made in Japan.
According to a survey conducted by
Statista, the most popular type of
product that Japanese consumers
purchased online was clothing;
41% of responders have purchased
clothing online in the past year.
A report from eShipper says
that the fastest-growing category in
eCommerce globally is electronics.
According to the list of Japan’s
eCommerce market share by
category released by METI (Ministry
of Economy, Trade and Industry),
electronics is the largest category.
It’s accounting for about 10% of the
market.
Now, we’re going to take a deeper look at some of the most popular,
profitable, and promising categories in Japanese eCommerce.
10
There are millions of online shoppers in Japan that
are purchasing on a daily basis and the only limit
to what they’ll buy online is what is available.
While this diversity is amazing and allows for all
types of brands to find success selling in Japan,
there are still some trends and statistics
worth noting:
The same publication found that
supplements, beauty products,
and personal care products are
the top products that Japanese
consumers purchase from
international merchants.
The fastest-growing eCommerce
categories in Japan include
cosmetics, electronics, furniture,
and more.
There are some products that
cannot be delivered in Japan at
this time; Rakuten offers detailed
information about these products
and provides additional resources.
Note: In order to make sure you’re
following all the regulations that
apply to overseas entities, it is best to
consult with a legal expert and default
to Japanese government resources
when it comes to what is prohibited.
FASHION & ATHLEISURE
Japanese consumers have a storied relationship with
American fashion and their purchasing habits often reflect
current trends. Athleisure, a term that has come to describe
clothes you can wear in the gym or out and about, is one of those
trends that has Japanese consumers getting on board.
Sporty clothing like yoga pants, tennis shoes, sweat pants, sports
bras, leggings, and windbreakers are all examples of products
that fall under the category athleisure.
Clothing always comes out at number one when you look at
eCommerce trends in Japan. Nearly half of Japanese shoppers
have purchased some kind of clothing in the past year and
clothing continues to hold the largest market share in Japanese
eCommerce. Revenue in fashion is projected to be roughly $24
million for the year 2020, placing Japan in the top five in terms of
global fashion revenue.
Apparel alone, excluding any accessories that also come under
the fashion umbrella, has a projected market value of
11
over $14 million USD for the year 2020. These are highly
desirable products for Japanese consumers and have remained
desirable for decades, making this a fairly foolproof move for
businesses who want to sell in Japan.
Any products in this category are subject to a few different
regulations in Japan. The primary regulation that sellers will
need to understand is the Household Goods Quality Labeling
Act, which is applicable to any sellers with a Japanese entity
or warehouses in Japan. All clothing items must feature labels
that describe the composition of the fabric, care instructions,
repellency, and the name of the label with clear
contact information.
For fashion brands resellers, valid purchase invoices and
proof of brand authorization are both required for some
internationally known fashion brands. This applies to anyone
who wants to sell clothing online in Japan, regardless of where
your business is registered.
BEAUTY & COSMETICS
Japanese beauty products are all the rage in America. One
thing that stands out is that beauty products and cosmetics in
Japan heavily favor skincare and more natural looks. American
cosmetics have more bold shades, offer more coverage, and
come with high-end and luxury labels that Japanese
consumers enjoy.
In 2019, there was a report that went in-depth to explore the
trend of buying used makeup among Japanese millennial
consumers because the demand for the products was so
significant. Japanese shoppers like the variety that American
cosmetics offer because many beauty products aren’t widely
available in Japan; American products are also typically much
cheaper.
Skincare, foundation, eye shadow, lipstick, highlighter palettes,
and all other sorts of makeup and personal care items fall into
this category.
Reports from 2020 show that Japan houses the third-largest
beauty and personal care market in the world. While that’s a
smaller slice of the pie than some other categories may have,
cosmetics and beauty products are one of the fastest-growing
eCommerce markets in Japan. Even in the wake of COVID-19,
cosmetics is projected to still hit growth predictions in 2021.
Cosmetics are also some of the best-selling products from
international brands in Japan. Japanese consumers purchase
personal care and beauty products as well as cosmetics from
more foreign brands than they used to. This has to do with both
12
price and the variety of products available. With about the 89.8%
internet penetration rate you read about, coupled with the rise
of social media, Japanese young generations have increased
access to western beauty information. This has skyrocketed the
interest and demand for western beauty products.
Many Korean brands have already cashed in on the trends
and found success in Japan thanks to strong digital marketing
strategy and savvy social media tactics. Rakuten has
documented the success of brands like Clio Cosmetics and
Ohora.
Cosmetics and beauty products are subject to quite a range of
regulations in Japan. Products cannot have labels that include
terms such as “rejuvenating” or “anti-aging.” It is important to
check that the products you intend to sell do not include any
ingredients that are banned in Japan.
In order to sell cosmetics or beauty products in Japan, a business
typically must obtain a license to distribute cosmetics; and will
also have to submit ingredients check for the products and apply
for licenses. As an overseas cosmetic company, a license is not
mandatory to sell on Rakuten.
Even without a license, all beauty products must adhere to the
Standards for Cosmetics. Labels must include ingredients, the
name of the manufacturer, and other key information. There are
also some ingredients that can’t be included in products sold in
Japan. This is all due to the Pharmaceutical Affairs Act.
SUPPLEMENTS
The dietary supplements market as a whole is massive. Total
revenue worldwide is projected to reach more than $210
billion USD in the next six years. The market for supplements
and nutraceuticals is also huge in Japan; Japan is the largest
consumer of these types of products in the region. Annual
revenue for just vitamins and minerals is quickly approaching
$2 billion USD in 2020. Probiotics, functional foods, and sports
nutrition products are also booming in popularity.
Products like Vitamin C, protein powder, multivitamins,
probiotics, other vitamins, minerals, and food additives can all be
classified as supplements.
When it comes to protein, the Japanese market is expanding
steadily. According to the Fuji Keizai Group Report in 2020, both
the protein supplement market and the protein powder market
are forecasted to grow by 11.8% and 17% YOY respectively. In
recent years, not only protein powders, but also other types of
protein food products have increased in popularity. Especially
during this COVID-19, new products like supplements and health
food are being launched.
Supplements are the best selling international products on the
Japanese eCommerce market. It is also one of the
fastest-growing categories, making it perfect to tackle for
businesses who want to start selling in Japan. Japanese
consumers want supplements that they can trust and the
unsteady ground that domestic products have been standing
on has left them running over to international manufacturers.
Japanese consumers show a lot of interest in quality
supplements that were manufactured in America and the EU;
platforms like Rakuten help pave the way for you to sell them.
However, there are several regulatory hoops to consider before
a business can start taking orders. Supplements, vitamins,
nutraceuticals, nootropics, and any other products that fall into
this category are subject to the Pharmaceutical Affairs Act.

MyProtein has only just entered the Japanese market, getting

started in 2016. Selling on eCommerce marketplaces became the
brand’s key strategy from 2018 onward. It has been successful
and is now looking at establishing their own cargo airlines in
order to expand their business.

SPORTS & OUTDOOR

As a category, Sports & Outdoor falls under the umbrella of Toys,
Hobby, and DIY when it comes to eCommerce. Consumption
in this category is trending upwards in 2021 and it is expected
to top $3,833 million becoming one of the fastest-growing
eCommerce categories in Japan. One of the contributing factors
of this expansion could be the Olympic Games, scheduled to take
place next year in Tokyo.
Products that fall into this category include sports equipment,
camping gear, and sportswear and accessories, etc.
Revenue in the Sports & Outdoor segment has grown and
predictions show that it could reach nearly $4 billion USD in 2020.
This particular category also has a significant edge compared to
other growing and popular categories; the growth rate is nearly
6%. User penetration is expected to jump from 16% this year
up to as much as 24.6% by 2025. These types of products are
becoming more important to Japanese shoppers.
A growing market is always a good place to consider when
expanding to Japan. The past few years and the next few years
have seen some major sporting events take place in Tokyo,
sparking a lot more interest. There is a lot of support for this
growing area of eCommerce even though the market share isn’t
as large as some of the other featured categories.
In fact, it has been ranked among more popular product groups
in Japan since as far back as 2015.
The regulations that you may be subject to all depend on exactly
what types of products you intend to sell. You could be impacted
by the Consumer Product Safety Act, the Household Goods
Quality Labeling Act, or any one of several regulations that
govern toys and other products designed for children. You can
get a basic overview of some of those regulations from MIPRO.

13
ELECTRONICS
Consumer electronics has been the second-largest
eCommerce category in Japan for several years running with
a market share of over 18%. It trails behind clothing, the top
category, by just 1%. Electronics is something that Japan was
synonymous with for decades; the shift that took Japan out of
the spotlight happened only recently.
Even though that’s true, products like phones, computers,
televisions, and other tech are still some of the most frequently
purchased by online shoppers in Japan. Revenue is projected
to reach $14 billion USD in the year 2020. The category has a
projected growth rate of just 4.5%; however, user penetration
is expected to surge from about one-third to nearly half of
consumers over the next four years.
One thing that makes electronics such a desirable category
for those in eCommerce that want to sell in Japan is that the
average revenue per user is higher than any of the other featured
categories. In fact, it is one of the highest across the board in
terms of the nation’s eCommerce market.
Surprisingly, electronics are typically more expensive for
Japanese consumers to purchase domestically. For example,
brand new smartphones can come in under $200 when
purchased from an international seller online; that same phone
could be as much as $475 more from a Japanese seller.
14
There were a handful of factors that kept prices high; market
domination from specific entities eroded incentives to lower
costs and Japanese consumers are not likely to purchase
electronics secondhand or from a retailer that they don’t trust.
For a long time, prices couldn’t budge. Legislation shifted the
market a few years ago; however, the trend has stuck.
Many Japanese consumers turn to the internet when they’re
shopping for electronics. American retailers typically offer
better prices and better quality products when purchased
internationally. If electronics are what you want to start selling in
Japan, though, there will be regulations.
The biggest one to keep in mind is that you will need to acquire
a PSE Mark or Giteki Mark. All electronic products with chargers
are required to obtain the PSE mark on the charger, whether sold
by an international or domestic entity in Japan.
This is also true of the Giteki mark. This must be present on
all electronic products with radio, signal, WiFi capability and
features, and Bluetooth.
This article from InCompliance outlines the intricacies of product
compliance in electronics.
Rakuten: Japan’s Largest
Online Marketplace
The final piece of the puzzle for anyone who wants to start selling in Japan is to choose what
eCommerce platform is going to be the best for them. No matter what angle you take, Rakuten is the
best choice for anyone who wants to sell online in Japan. In this section, you will learn about Rakuten,
how to get started, and the features that put this online marketplace leagues ahead of its competitors.

Rakuten is the largest eCommerce marketplace in Japan
with more than 26.8% of all online sales taking place on
the platform. There are over 111.4 million Japanese users
registered on the site which means that 80% of the country’s
population uses Rakuten. It is very widely used and has a track
record of more than two decades serving its customers’ best
interests. Japanese consumers trust the platform and trust
is exceedingly important in Japan. Coming to an established
platform like Rakuten that has such an extensive user base
provides access to millions of potential customers and provides
instant credibility to penetrate the market.
There are roughly 50,000 merchants registered on Rakuten and
gross merchandise sales exceeded $37 billion USD in 2019. It is an
incredibly large online marketplace not just in Japan but also by
global standards.
Rakuten was founded in 1997 and has been slowly pushing
forward ever since. Most Americans had probably never heard
of Rakuten until 2014 when the shopping rewards company
Ebates was acquired by the company. Ebates was a cash-back
and shopping rewards service in which online shoppers can earn
cash back through finding more than 2,500 partner retailers and
brands through its platform.
Ebates didn’t fully rebrand as Rakuten until late 2019. Rakuten
has also invested in Lyft and partnered with massive American
names like Walmart, the Golden State Warriors and the NBA to
name a few. Despite pursuing multiple endeavors to expand,
Rakuten remains dedicated to its online marketplace and the
multitude of services it offers to Japan; these endeavors are
completely separate. This dedication is what sets it apart for
consumers and sellers alike.

IT’S A STRAIGHTFORWARD
PROCESS TO GET STARTED
One of the reasons that Rakuten is such a great option to
start selling in Japan is that it has opened international
sellers onboarding service to the American sellers first before
any other country.
In order to make joining their Japanese platform easier and more
accessible, the company has also stationed a dedicated team in
their US headquarters (San Mateo, CA) to provide local support
to the American sellers. Users receive a free consultation for
expanding their business to Japan with one of their onboarding
consultants by filling out a basic contact information from their
onboard guidance page.
After you are well informed of what to prepare, you will have to
go through an application process. This is an important feature
that helps provide Japanese consumers peace of mind. All new
merchants are closely examined and must be completely vetted
before they’re allowed access to the platform which helps create
trust.
Businesses do not need to have a Japanese business entity in
order to be eligible to sell on Rakuten. Businesses that operate
out of the United States are completely welcome. International
sellers from any country that isn’t listed for the Direct Shop Plan
will be required to sign a contract with a Rakuten-approved
service partner, though. The service partner is a third-party
entity that will give you a local team to set up your store.

Since many are not likely to have an existing Japanese entity, you will
want to be familiar with the following criteria to sell on Rakuten:

The business must be capable of establishing

The business must be incorporated and not
reliable logistics so products can go straight
be operating as a sole proprietorship
from you to your customers

It must have great capabilities in Japanese

The company must already have a eCommerce language or you are capable of securing a
site or sell on a third-party platform trusted third-party partner or a freelancer to
set up and manage the store.
15
Once a business is confident it meets all of those criteria, it
should reach out to a representative by visiting the onboard
guidance page and fill out the contact information. The
representative from Rakuten will reach out to you and cater to
any question you may have about the platform and Japanese
market in general so that you can make an informed decision
before it is time to register.
During the registration process, you will need to provide your
company details and some basic information about your
business, and your contact information. You’ll receive an
application kit from the representative you talk to if you both
agree that you’re ready.
If you’re ready to proceed, your application will be sent in for the
screening process to begin. They will verify the information that
you provided and make sure that you are a legitimate business
and don’t have any serious problems in your history as a US
seller. The application kit contains important documents you’ll
need to complete before you can set up your store.
Rakuten has taken extra steps in recent years to streamline
the application process and make it more easily accessible for
US-based businesses. Businesses will even be able to receive all
payouts in USD, no conversion necessary! This is because you will
IT’S PACKED WITH
AMAZING FEATURES
Rakuten is so widely successful because it is designed, in
every way, to provide businesses and consumers with the best
possible online shopping experience.
One of the main things that sets Rakuten apart is that it isn’t
an online marketplace that functions as a catalog of products.
In the past, it has been likened to the equivalent of an online
shopping mall. The shop-centric focus of Rakuten helps provide a
consumer-centric experience for shoppers.
With account access, you will be able to set up a completely
customizable digital storefront. Japanese consumers favor this
as opposed to the format of Rakuten’s main competitors. Your
digital storefront is where you will tell the story of your brand,
explain your policies, showcase products, and more. You have the
ability to update your storefront at any time to reflect any sales,
promotions, holidays, or general updates to the way you run
your business and the products you offer. This is one of the main
differentiators for Rakuten. It is a rich ecosystem of businesses
that function independently.
Product pages are given the exact same flexibility. Rakuten
allows you to create custom pages for each individual product
that you sell. This is extremely useful because these dedicated
pages help you reach your customers more effectively. You
can include as many photos, features, descriptions, and other
details that you see fit. Having access to as much information
as possible is part of the reason why shoppers in Japan love
Rakuten so much. This attention to detail truly enhances the
customer shopping experience.
16
sign up with PingPong, an ecommerce global payment company
that makes accessing your funds simple and painless.
After you have submitted your full application and have passed
the screening process, you’ll be able to officially register. Then,
you will be able to access your Rakuten account and set up
your online store. Don’t worry, you will have another Rakuten
representative who will assist and answer any question regarding
the store set up. This entire process can take about 2-3 weeks to
complete. While you’re waiting to receive your documents, that
is the perfect time to even out some logistics and make sure you
have access to reliable translators.
The extensive options you’ll have for these pages will allow
you to curate gorgeous content that provides strong visuals
and highlight the features and benefits of your products. You
can also show step-by-step examples of how to use it. Rich
information and rich tutorials can help boost your sales because
it makes product selection engaging and immersive. This level of
customization is something you can only find on Rakuten.
If the prospect of setting up a completely custom online store
seems overwhelming, you’ll be pleased to know that you have
nothing to worry about. Every seller on Rakuten is paired with an
advisor to help walk you through opening your shop. This advisor
can provide you with advice for setting up your account, design
tips for your shop, and can help you perfect your merchandising
strategy with market insight and years of experience.
You will also have a Merchant Development Manager that will
help familiarize you with the specifics of cross-border trading and
Japanese eCommerce. Finally, the last member on your team of
dedicated consultants is the eCommerce Consultant. They will
help point you in the right direction with promotional guidance,
tips to improve your marketing strategies, and ongoing
performance feedback.
Rakuten offers exceptional customer support for both sellers
and shoppers. You will be able to access help any time you
need it while you run your shop on the platform.
IT HAS EVERYTHING
YOUR CUSTOMERS WANT
One of the things that has grown Rakuten to
the eCommerce powerhouse that it is is that customers
love it. The verification process sellers go through helps
establish trust for your business, the detailed storefront and
product pages help potential buyers get to know you and
your products, and the customer support helps problems get
resolved with ease.Each company is responsible for customer
support; however, you will have access to a consultant that helps
you handle customer service effectively. Japanese consumers
also have the opportunity to raise problems directly with
Rakuten if necessary.
Rakuten offers sellers the opportunity to include more shipping
options than any other platform to help maximize flexibility for
their customers. Customers tend to prefer free shipping and
have gotten accustomed to very fast delivery times because
Japan is such a small country, geographically speaking. This
isn’t a dealbreaker for many shoppers, though. The best part
is that there are no shipping-related surprises for customers at
checkout because you can include information about standard,
priority, expedited, and other shipping options you offer.
Instead, consumers will be able to see right away when
navigating to your shop if you’re shipping from outside of Japan
and detail the cost and delivery time that they can expect
when purchasing your products. This is very important because
transparency is something Japanese consumers expect from
shop owners like you.
IT HAS EVERYTHING
YOU NEED AS A SELLER
Rakuten is an amazing online marketplace for businesses
that want to sell their products in Japan. Keep in mind that
you must already have an eCommerce presence and be properly
incorporated. There are a handful of additional features that
Rakuten has created to help you reach your business goals when
you expand globally.
Rakuten has multiple logistic partners that you can reach out to
in order to help you with order fulfillment if you do not already
have your fulfillment channels in place. If you do already have
logistics organized, Rakuten does not require you to make any
changes. There are also official service partners that offer
translation and localization. Having a dedicated partner for this
is crucial to your success and Rakuten takes the guesswork out of
finding someone reliable and reputable to get it done.
These official service partners don’t just translate your pages
into Japanese; they also help you to seamlessly localize your
content to fit the preferences of Japanese shoppers. The
majority of them actually run all general store operations on your
behalf.
Rakuten also provides you with some great promotional tools
for running your store. Rakuten users receive 1% in point back as
17
The feedback system, which takes shape as user reviews,
on Rakuten is another way that shoppers are offered great
transparency. After making a purchase, people are able to rate
sellers as well as each individual product that they bought.
Your customers will be asked to rate their experience based on
several factors like item description accuracy, condition of the
item, shipping speed, and customer service. The reviews that you
receive may impact your placement in search rankings.
Negative reviews are not allowed to be removed. This helps
shoppers know that all of the information they see is true and
reflects the accurate experience of people who’ve bought
from you in the past. It also further incentivizes shop owners
to provide the best possible products and customer service.
a default, but you have the option to participate in the Rakuten
Points program and you could offer your shoppers as much
as 20% points back daily. You can run seasonal sales or major
promotions or provide coupons and temporary points bonuses to
shoppers. There are tools that will help you push add-ons, upsells,
and return customers.
You will have amazing customer outreach tools built right in with
R-Mail. R-mail is an email marketing feature in which you’ll be
able to send things like email magazines to promote sales, new
product launch information, and prompts to come shop with
you again to those users who have bought from your store in
the past. This is a super unique feature which most of Rakuten’s
competitors, like Amazon, do not offer.
Also, all of the data you could ever need will be right at your
fingertips thanks to the Rakuten Merchant Server. The RMS
stores data like traffic, sales, demographics, and more. You will
also be able to run tests and gain a ton of valuable insight using
this tool. Order management, customer management, analytics,
and listing optimization are all important tasks to keeping your
store running the way you want it to and the RMS makes all of
these things easy.
IT HAS A BUILT-IN
LOYALTY PROGRAM
Finally, the most popular feature on Rakuten has to be its
robust customer loyalty program. A large portion of Japanese
shoppers choose the online marketplace they frequent based
on their ability to rack up rewards points. This is one of the key
things that distinguishes Rakuten among its competitors. This
program is called Rakuten Points®. Rakuten has done some
amazing things with this program.
Rakuten offers more than 70 services in total, spanning
eCommerce, financial services, and content business. Although
Rakuten got started as an eCommerce company, it is now one
of the market leaders in many fields. Rakuten has one of Japan’s
largest credit cards, and is number one in terms of transaction
volume.
If one of the 20 million Rakuten Card users shops at Rakuten,
they get a bonus and receive as much as 3% back. Even if you are
not using the card in Rakuten services, 1% of your card spending
gets redeemed as Rakuten Point. This is just one example of
how the Rakuten ecosystem is creating synergy. Online banking,
mobile phone businesses, this credit card, and many other
services create a lot of synergy with the loyalty program, further
deepening customer ties to the platform.

Some Standout Stats:

Rakuten has issued more than 2 trillion
points (roughly equivalent to $2 billion)
since piloting the program in 2002
Roughly half of those points have been
issued in the last three years because the
opportunities for shoppers to earn them
have expanded. In 2019 alone, 32 billion
Rakuten Points were issued.
Expanding the program has ramped
up usage across multiple services
Rakuten offers, which shows that
shoppers are excited about the benefits
of membership. In fact, the number of
shoppers who use more than two Rakuten
services increased from 64.9% in 2017 to
72.3% in 2019.

Customers have the chance to earn Standard Points by making
regular purchases as well as Limited Time Points by participating
in special promotional events. There are special member days
that allow shoppers to earn a ton of extra points, too. In these
kinds of events, users can earn up to 40+%. Sellers will be able
to create store events and shoppers will have occasional bonus
offers that are tailored to their shopping habits.
One thing that has helped truly drive the popularity of this points
system is that Rakuten also offers the credit card you just read
about. However, the hottest thing Rakuten has going right now is
their mobile business. In just the past year, Rakuten has become
one of the top-five mobile providers in Japan and plans to soon
roll out 5G to its users. Customers will be able to use Rakuten
Points towards their phone bills too!

Running promotions to help increase the number of points your Anything that helps bolster customer loyalty to the platform
customers receive is a great way to help bring repeat customers. is going to help keep your customer base broad; then, you can
This loyalty points program is extremely popular in Japan and it utilize the points system to your own advantage to drive your
is something customers truly enjoy. Tapping into the possibilities own repeat sales.
with this loyalty program could help you really propel your
business forward once you start selling in Japan.
18
RAKUTEN IS THE FULL PACKAGE
No matter what type of products you sell or what level of experience you have, there is no better
eCommerce platform out there. Rakuten has a great reputation, the largest market share, the
largest user base, and the most perfectly tailored features that can help you secure your success.

Are you ready to open your shop on Japan’s largest online

marketplace and start selling in Japan?

Get started today with Rakuten.

This ebook was prepared by IGW in collaboration with Rakuten.

IGW is the premier expert in visual communication strategy and
is a proud Rakuten outsource partner.

19
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https://www.plazajapan.com/blog/japanese-vs-usa-cosmetics/
https://www.statista.com/outlook/70000000/100/beauty-
personal-care/worldwide#market-arpu
https://exporttojapan.co.uk/selling-japan-through-e-commerce-
platforms/
https://www.mipro.or.jp/Document/hti0re0000000vi2-att/
pdf_publications_0105gtsa.pdf
https://www.globenewswire.com/news-
release/2019/03/25/1760423/0/en/Dietary-Supplements-Market-
To-Reach-USD-210-3-Billion-By-2026-Reports-And-Data.html
https://www.eu-japan.eu/sites/default/files/publications/
docs/2016-03-nutraceuticals-japan-min.pdf
https://www.statista.com/outlook/18050000/121/vitamins-
minerals/japan
https://www.researchandmarkets.com/reports/1867369/
nutritional_and_dietary_supplements_market_in
https://www.nutraingredients-asia.com/Article/2019/12/19/
Concerns-on-quality-of-Japanese-health-supplements-as-more-
than-40-fail-pharma-solubility-test
https://www.wpic.co/blog/wpic-activates-leading-edge-health-
on-rakuten-ichiba/
https://www.mynewsdesk.com/us/renub-research/
pressreleases/japan-e-commerce-market-forecast-by-retail-
toys-and-electronics-renub-research-2999991
https://www.ispo.com/en/markets/olympia-2021-boosts-japans-
sports-market
https://www.statista.com/outlook/259/121/sports-outdoor/japan
https://www.datocms-assets.com/2580/1498859756-japan_
b2c_e-commerce_report_2016.pdf
https://www.globenewswire.com/news-
release/2020/07/24/2067160/0/en/Japanese-e-Commerce-
Industry-Analysis-2017-2026.html
https://www.statista.com/outlook/251/121/consumer-
electronics/japan
https://blog.gaijinpot.com/why-are-these-things-so-expensive-
in-japan/
https://www.rakuten.co.jp/ec/sellinjapan/