Rakuten, Japan’s e-commerce powerhouse, is taking another step in its ambitions to be a global player on par with the likes of Amazon and Alibaba. Today, the company is launching Rakuten.co.uk, its first own-brand online marketplace in the UK, where it will bring together goods sold directly by itself as well as third-party retailers; its Kobo e-books store; and its Wuaki video streaming service.
Along with this, Rakuten will wind down its Play.com brand — picked up when Rakuten acquired the service in 2011 for just under $40 million.
In addition to books, gadgets and digital content, Rakuten.co.uk will offer food and drink, health and beauty, clothing and pet care — opening up the strong possibility that Rakuten will also start to toy with delivery services and online groceries, similar to Amazon and others.
The idea behind launching Rakuten.co.uk is simple: Rakuten has grown in Europe by way of acquisition and now it’s trying to bring together the disparate businesses into a more unified, strategic front. In addition to Play.com, the company acquired France’s PriceMinister – for $250 million – in 2010 and Germany’s Tradoria in July 2011, as well as more targeted content acquisitions like Kobo, Spain’s Wuaki, messaging app Viber and online, crowdsource-subtitled video portal Viki.
It’s also in keeping with Rakuten’s decision to drop Buy.com in the U.S. in favor of Rakuten.com — another acquisition that eventually also got wrapped into the company’s main brand — yet more sacrificing of short and simple, and presumably coveted generic URLs, in the name of brand unification.
But the move is being made not just for branding but potentially also for economies of scale. It’s no surprise that Rakuten also plans to introduce a unified billing platform for all of its services by December of this year. Alongside that it’s launching a “Super Points” loyalty program that will let people’s purchases in one area — say, cat food — count towards discounts in another — say, for a film on Wuaki.
Indeed, both aspects are being highlighted by Rakuten itself:
“What consumers want from retailers is continually changing, however the desire for a personal and entertaining experience remains constant,” said Kenji Hirose, CEO of Rakuten Europe, in a statement. “With the launch of Rakuten.co.uk we are making it easier for shoppers to discover what they want and empowering merchants to provide it. Over the next 12 months we will pioneer a new era of borderless retail and entertainment by integrating our e-commerce offering with our global ecosystem of Internet services, to make shopping more fun.” The site will be run by Mike Bishop as managing director of Rakuten.co.uk.
Rakuten is significantly smaller than Alibaba in terms of its size, reach and market capitalization — it’s currently valued at around $15 billion to Alibaba’s $221 billion — but its ambitions are no less big.
In addition to the moves into digital content by way of Kobo and Wuaki, the Japanese company recently acquired Ebates in the U.S. for $1 billion, shopping tracking service Slice,
And it’s facing stronger competition not just from Amazon and Alibaba but potentially also from a rival closer to home.
Just earlier today Softbank teamed up with Sequoia for a $1 billion investment in Tokopedia, an Amazon-style marketplace in Indonesia. Softbank is also reportedly making an investment in India’s Snapdeal to the tune of $650 million. We’re reaching out to see if we can get any more details on the progress of the latter.
So what will Rakuten offer to retailers to entice them to list products there instead of or in addition to eBay or Amazon?
One will be its “proprietary” E-Commerce Consultants service. Rakuten describes the consultancy/business concierge style service like this: “a position specifically created with the sole purpose of supporting the success of Rakuten merchants—offer merchants dedicated support and guidance to ensure Rakuten merchants have a deep understanding of the Rakuten merchant platform and its powerful tools and to keep them informed about potential opportunities to maximize their sales.” Businesses can sign up for this and for selling on Rakuten’s platform on a monthly contract.