Asian eTailing Giant Rakuten Sets Its Sights On The U.S.

Asia’s largest eCommerce players like what they see in the U.S. First, China’s Alibaba announced plans for a U.S. IPO and has since launched the 11 Main online marketplace here. Now Rakuten, Japan’s largest online retailer, appears to have its own U.S. plans. The addition of the two companies to the U.S. likely will help build even more growth in domestic online purchasing.

First it was China’s eCommerce megaretailer Alibaba coming to the U.S. to compete with Amazon and eBay. Now another Asian company looks poised to follow Alibaba’s lead, further helping an already strong U.S. online marketplace, where Internet sales exceeded $262 billion last year.

Venturebeat.com reports that Japan’s largest online retailer, Rakuten, may soon enter the U.S. market. In June, the company launched a $100 million investment fund to focus on startups in the U.S., Israel and Asia Pacific region.

The company recently acquired U.S.-based eCommerce app Slice, apparently in an attempt to expand its offerings domestically and compete against two of nation’s top eCommerce sites, Amazon and eBay. A year ago, it led a $23 million funding round for the company.

eReceipt management

Slice works with users’ email inboxes to find and store eReceipts from Amazon and other online retailers. Its free service also tracks packages ordered from shipment to delivery, plus it send notices of price changes as well as users’ spending and purchase histories.

It’s likely Rakuten sees owning such information as something valuable it could sell to other firms. “We have a vision to grow our business in the U.S.,” Yaz Iida, CEO of Rakuten marketing, said in Wall Street Journal account of the Slice deal. “There’s tremendous value in this technology to any company doing business online. It all comes down to customer data.”

That acquisition followed a 2010 deal where Rakuten bought Buy.com for $250 million but didn’t use the acquisition to move its own operations into the U.S. market. Rakuten does operate a U.S. subsidiary, Rakuten Super Logistics Inc. (formerly webgistix.com), which specializes in eCommerce B2B order fulfillment. Earlier this week Rakuten Super Logistics announced that it will begin accepting bitcoin payments from its customers.

Rakuten earnings

In early August, Rakuten reported revenue of $276.6 billion yen (US$2.7 billion) for the first six months of the year, up 14.8 percent from a year earlier. Net income attributable to owners of the parent company totaled  23.1 billion yen, down 9.9 percent.

Alibaba, which is preparing for an IPO widely forecasted to be one of the biggest money makers in the history of international commerce, in June dipped its first toe into selling directly to U.S. consumers with the launch of 11 Main.

The 11 Main marketplace is the brainchild of Alibaba’s two U.S. affiliates, Vendio and Auctiva. It features such wares as clothes, fashion accessories, jewelry, interior goods, and, arts and crafts.

Alibaba’s plans

This 11 Main launch planted the new marketplace in direct competition with several already established U.S. site such as Amazon, eBay and Etsy. The site currently features about 1,000 merchants, though the company hopes to attract more.

The main focus now is on recruitment. 11 Main is encouraging merchants to participate by allowing them access to the platform at a much lower cost than is traditional on other websites. At the same time, 11 Main is also trying to be a home to strong merchant performers—with an intense quality screening in place before a merchant can join up.

Over the past year, Alibaba has struck a string of deals in the U.S. In 2013, the company led a $206 million investment round in ShopRunner Inc., a rival service to Amazon offering unlimited quick shipping within the U.S.

Through March 31 this year, Alibaba earned full-year revenue of $8.4 billion and net income of $3.7 billion, according to an SEC filing. The company reportedly pushed back its U.S. IPO on the New York Stock Exchange until September. The IPO is expected to raise some $20 billion, with the company’s net worth expected to rise to more than $200 billion.