Rakuten

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Rakuten
Traded as JASDAQ: 4755
Industry Online retailing, Internet
Founded February 7, 1997
Founder(s) Hiroshi Mikitani
Headquarters Tokyo, Japan
Area served Japan
Key people Hiroshi Mikitani
(Chairman and CEO)
Revenue Increase $4.7 billion (2012)[1]
Net income Increase $208 million (2012)[1]
Employees 10,351 (June 2013)[2]
Website rakuten.co.jp
global.rakuten.com/group/
Hiroshi Mikitani, founder and CEO of Rakuten

Rakuten, Inc. (楽天株式会社 Rakuten Kabushiki-kaisha) (JASDAQ: 4755) is a Japanese electronic commerce and Internet company based in Tokyo, Japan. Its B2B2C[3] e-commerce platform Rakuten Ichiba is the largest e-commerce site in Japan and among the world’s largest by sales.[4]

Hiroshi Mikitani founded the company in February 1997 as MDM, Inc., and is still its chief executive. Rakuten Shopping Mall (楽天市場 Rakuten Ichiba) started operations in May 1997. In June 1999, the company changed its name to Rakuten, Inc. The Japanese word rakuten means optimism.[5]

In 2012, the company's revenues totaled US$4.7 billion with operating profits of about US$770 million.[6] In June 2013, Rakuten, Inc. reported it had a total of 10,351 employees worldwide.[7]

In 2005, Rakuten started expanding outside Japan, mainly through acquisitions and joint ventures.[8] Its acquisitions include Buy.com (now Rakuten.com Shopping in the US), Priceminister (France), Ikeda (now Rakuten Brasil), Tradoria (now Rakuten Deutschland), Play.com (UK), Wuaki.tv (Spain), and Kobo Inc. (Canada).[9] The company has investments in Pinterest,[10] Ozon.ru,[11] AHA Life,[12] and Daily Grommet.[13]

Lines of business

The Rakuten Group consists in total of around forty businesses & services such as -

  1. Online retail: Operation in a number of countries outside Japan;
  2. Banking, Credit and Payments: Offering personal consumer credit services including card loans, mortgages, and other banking services;
  3. Portal and Media: Managing portal sites acting as gateways to the internet, and performing other activities;
  4. Travel: Operating hotel booking and other travel-related websites and providing other services;
  5. Securities: Providing services such as online securities brokerage;
  6. Professional Sports: Managing a professional baseball team, planning and selling related merchandise and performing other activities;
  7. Entertainment: Online video club.

The group's 2010 annual report shows that its online shopping business, Rakuten Ichiba, was Japan's largest online shopping mall, offering customers more than 95 million products from about 40,000 merchants.[14][15] It also had 6 million credit card customers and more than 75 million users in Japan.[15] As part of the group's globalization initiative, Rakuten Ichiba started offering international shipping.

Developments

In October 2005, Rakuten bought a 15% stake in Tokyo Broadcasting System, raising its stake in the broadcaster to 19%.[16] Rakuten later withdrew its bid and sold its shareholding back to Tokyo Broadcasting.[17][18]

Global expansion

2005 Rakuten bought New York City-based Linkshare - since rebranded "Rakuten Linkshare" - offering performance-based online sales and marketing programs.[19][20][21][22]

2010 To increase its global competitiveness, Rakuten decided to adopt English as the company’s official language from mid-2012.[23][24] That year, Rakuten also bought French online retailer Priceminister for €200 million[25] and US-based Buy.com for US$250 million.[26][27] The group had been a significant shareholder in Ctrip, a Chinese travel site until it sold its stake in the company in August 2007 and, in 2010, it announced a joint venture with Baidu in China (Lekutian).[28][29]

2011 After launching Indonesia's Rakuten Belanja Online, a joint venture in June the group continued its global growth the same month, snapping up Brazilian e-commerce firm Ikeda — since,renamed Rakuten Brazil. In July, it bought German e-commerce start-up Tradoria and rebranded it Rakuten Deutschland, and in September UK online retailer and e-commerce marketplace Play.com for £25 million (almost $41 million). After a 2010 UK government decision to impose Value Added Tax on UK-based companies' sales from the Channel Islands - until then exempt from the tax on shipments of goods worth less than £18 (about $28)[30] - Rakuten closed one of three Play.com warehouses on the island of Guernsey.[31] In September, Rakuten took a minority equity stake in Russian online retailer Ozon.ru,dubbed 'Russia's Amazon', which had reported 2010 sales worth US$137 million.[32] A four-company-strong consortium, led by the Japanese group, invested US$100 million. Rakuten's stake was not revealed.[33]

2012 Rakuten bought Canadian e-book reader company Kobo in January.[34][35] - a deal not finalized until January 2012.[36] On 17 May, Rakuten announced that it was leading consortium investing $100 million in the Pinterest picture sharing social network — its partners were existing investors Andreessen Horowitz, Bessemer Venture Partners, and FirstMark Capital, and a number of investment 'angels'. That investment marked the start of a drive to expand Pinterest's presence in Japan and Rakuten’s 17 other global markets. “While some may see e-commerce as a straightforward vending machine-like experience, we believe it is a living process where both retailers and consumers can communicate, discover, and curate to make the experience more entertaining," said Hiroshi Mikitani, Rakuten chief executive.[37]

On 13 June, Rakuten bought Wuaki.tv, a Spanish (Barcelona, Catalonia) video on demand (VOD) service/company that is one of the largest in Europe and the market leader in Spain, where it has over 600,000 registered users. That opened new opportunities, directly challenging Amazon, Netflix and others for domination of the VOD market — at first, in Europe and, later, elsewhere.[38] In November, Rakuten bought French online retail delivery company Alpha Direct Services. "Speed and quality of delivery is at the heart of any solid e-commerce proposition," said the Japanese group's Hiroshi Mikitani.[39]

By late 2012, Rakuten had also moved into online retail in Austria, Canada, Spain, Taiwan and Thailand and into the online travel markets in France — with Voyager Moins Cher.com — and China, Hong Kong, Korea and Taiwan — with its Tokyo-based international Rakuten Travel platform. In North America, Rakuten Golf made booking tee time online possible.[40]

2013 In May 2013, Rakuten acquired a majority share in “citizen commerce” site, Daily Grommet,[41] since rebranded as The Grommet.[42] In June 2013, Rakuten announced its acquisition of U.S.-based logistics and services company Webgistix.[43] specializing in fulfillment technology for e-commerce retailers. The acquisition is Rakuten’s second logistics investment outside of Japan and enables prompt fulfillment in the U.S.

In Septermber 2013, Rakuten acquired Singapore-based Viki.[44]

Selected subsidiaries

(source Rakuten Inc.[45])

  • Alpha Direct Services
  • Dot Commodity, Inc.
  • Fusion Communications Corp.
  • Keiba Mall, Inc.
  • Kenko.com. Inc.
  • Kobo Inc.
  • LinkShare Japan K.K.
  • Net's Partners, Inc.
  • O-net, Inc.
  • Play.com
  • Priceminister S.A.S
  • PT.Rakuten-MNC
  • Rakuten Auction Inc.
  • Rakuten Austria GmbH
  • Rakuten Baseball, Inc.
  • Rakuten Bank, Ltd.
  • Rakuten Brasil Internet Service Ltda.
  • Rakuten Card Co., Ltd
  • Rakuten Deutschland GmbH
  • Rakuten Edy, Inc.
  • Rakuten EMOBILE, Inc.
  • Rakuten Enterprise Inc.
  • Rakuten Insurance Planning Co., Ltd.
  • Rakuten Investment Management, Inc.
  • Rakuten Life Insurance Co. Ltd.
  • Rakuten Linkshare (formerly LinkShare Corporation)
  • Rakuten Logistics, Inc.
  • Rakuten Loyalty (formerly FreeCause)[46]
  • Rakuten Malaysia Sdn. Bhd.
  • Rakuten MediaForge, Inc.
  • Rakuten Research, Inc.
  • Rakuten Securities, Inc.
  • Rakuten Shashinkan, Inc.
  • Rakuten.com Shopping (formerly Buy.com)
  • Rakuten ShowTime, Inc. (Japan)[47]
  • Rakuten Travel, Inc.
  • Shareee, Inc.
  • Signature Japan Co., Ltd.
  • Taiwan Rakuten Ichiba, Inc.
  • TARAD Dot Com Co., Ltd.
  • TicketStar Inc.
  • Wuaki.tv
  • Viki
  • Webgistix

See also

References

  1. ↑ 1.0 1.1 "Info: Rakuten" - Rakuten Annual Reports for FY 2012
  2. ↑ "Gross Merchandise Sales & Number of Employees", Rakuten
  3. ↑ "Business to Business to Consumer." Techopedia.
  4. ↑ "'s expanding footprint reaches America." Retailing Today. 5 June 2013.
  5. ↑ "Rakuten". Jeffrey's Japanese English Dictionary Server. Retrieved 13 February 2013. 
  6. ↑ Rakuten Annual Reports for FY 2012, Rakuten
  7. ↑ Gross Merchandise Sales and Number of Employees, Rakuten, Inc.
  8. ↑ "Profile: Rakuten, Inc.", Bloomberg
  9. ↑ Overview, Rakuten, Inc.
  10. ↑ Swisher, Kara. "[http://allthingsd.com/20120516/exclusive-japans-rakuten-wins-the-heart-of-pinterest-founder-in-funding-race/|Exclusive: Japan's Rakuten Wins the Heart of Pinterest in $100M Funding Race With $1.5B Valuation]" All Things D. 16 May 2012
  11. ↑ Martin, Rick. "Invests in Russian O-zon.ru." Tech in Asia. 9 September 2011.
  12. ↑ Rao, Leena. "Raises $10.1M To Curate And Sell Hard-To-Find, Luxury Products From Around The World." TechCrunch. 26 April 2012.
  13. ↑ Swisher, Kara. "Japan’s Rakuten Ups Its Stake in the Rebranded Grommet." All Things D. 14 May 2013.
  14. ↑ Leesa-nguansuk, Suchit, "Click till you drop: Japan's Rakuten plots e-commerce world domination", Bangkok Post, February 15, 2012
  15. ↑ 15.0 15.1 Ishida, Michiyo, "Rakuten posts 8% rise in Q1 operating profit", Channel NewsAsia, 12 May 2011
  16. ↑ Olson, Parmy, "Rakuten's Mikitani To Take Over Tokyo Broadcasting?", Forbes, October 13, 2005
  17. ↑ "Annual Financial Report (Consolidated) for the First Quarter of Fiscal 2011 Rakuten, Inc.", May 12, 2011. "As a result of this verdict, Rakuten sold the shares in Tokyo Broadcasting System Holdings, Inc. to that company on May 10, 2011 at a price of ¥1,294 per share, which was the amount stipulated in the rulings of the Tokyo District Court and the Tokyo High Court."
  18. ↑ "Share Price for TBS Buy-back of Rakuten-held Stocks Finally Decided", Rakuten Inc. Press release, April 20, 2011
  19. ↑ Toto, Serkan, "Japan's Rakuten: Can The Biggest E-Commerce Site You Never Heard Of Become a Threat for Amazon Globally?", TechCrunch, Sunday, July 5th, 2009
  20. ↑ "Rakuten, Leading Japanese E-Commerce Portal, to Acquire LinkShare, Leading U.S. Performance-Based E-Commerce Company", PR Newswire, September 5, 2005
  21. ↑ Hyuga, Takahiko; Sekioka, Tomomi, "Rakuten to Acquire LinkShare for $425 Million", Bloomberg News, September 5, 2005
  22. ↑ "Rakuten LinkShare: Leading Performance Marketing Network Debuts New Logo", Business Wire, Feb 23, 2012
  23. ↑ "Rakuten to hold all formal internal meetings in English | The Japan Times Online". Search.japantimes.co.jp. 2010-05-18. Retrieved 2011-10-04. 
  24. ↑ "Rakuten to make English official language inside company by end of 2012", The Mainichi Daily News, July 1, 2010 (archived 2010)
  25. ↑ Wauters, Robin (2010-06-17). "Rakuten to acquire France’s PriceMinister for approximately €200 million". TechCrunch (Eu.techcrunch.com). Retrieved 2011-10-04. 
  26. ↑ posted on May 20th, 2010 (2010-05-20). "Buy.com Gets Acquired By Japanese E-Commerce Giant Rakuten For $250 Million". TechCrunch. Retrieved 2011-10-04. 
  27. ↑ "Japan's Rakuten to Acquire Buy.com", The Wall Street Journal, May 21, 2010
  28. ↑ Thibault, Marie, "Skyping With a Japanese Billionaire", Forbes, January 28, 2010
  29. ↑ "RAKUTEN starts new business in CHINA with BIDU-O", Japan Press, January 27, 2010
  30. ↑ The hidden cost of online shopping, Patrick Barkham and Simon Bowers, The Guardian, London, 9 December, 2010.Retrieved: 27 December 2012.
  31. ↑ Published Wednesday, Sep 21 2011, 12:43 BST (2011-09-21). "Play.com bought by Japanese firm Rakuten for £25m — Media News". Digital Spy. Retrieved 2011-10-04. 
  32. ↑ Ozon.ru wins biggest Russian e-commerce investment, Reuters news agency, 8 September 2011.Retrieved: 27 December 2012.
  33. ↑ "японская школа торговли". Expert Magazine, Russia. 
  34. ↑ Trout, Christopher, "Rakuten signs agreement to purchase Kobo", Engadget, Nov 8th 2011
  35. ↑ Martin, Rick, "Japanese Online Retail Giant Rakuten Set to Acquire eBook Service Kobo", Penn-Olson reports, November 9, 2011
  36. ↑ "Indigo Announces Completion of Kobo Sale", Bloomberg, Jan 11th 2012
  37. ↑ "Exclusive: Japan’s Rakuten Wins the Heart of Pinterest in $100M Funding Race With $1.5B Valuation", All things digital, 17 May 2012
  38. ↑ "Rakuten adquiere Wuaki.tv [Spanish]", Wuaki.tv Blog, 17 June 17, 2012.Retrieved 27 December 2012
  39. ↑ Rakuten Acquires Alpha Direct Services, Rakuten corporate blog, 7 November 2012.Retrieved 27 December 2012
  40. ↑ All Rakuten Services Rakuten corporate website, Undated.Retrieved: 27 December 2012.
  41. ↑ Japan's Rakuten Ups Its Stake in the Rebranded Grommet - Kara Swisher - Commerce. AllThingsD (2013-05-14). Retrieved on 2013-09-19.
  42. ↑ Online Marketplaces - Don’t call me ‘daily’: The Grommet drops the chronological element in its rebranding. Internet Retailer. Retrieved on 2013-09-21.
  43. ↑ Rakuten Acquires U.S.-based Logistics Company Webgistix | | Fulfilling eCommerce. Webgistix.com (2013-06-05). Retrieved on 2013-09-19.
  44. ↑ "Rakuten extends its focus on entertainment after buying Singapore-based video service Viki". The Next Web. Retrieved September 2, 2013. 
  45. ↑ About: Rakuten Group, Rakuten, Inc.
  46. ↑ FreeCause website
  47. ↑ ShowTime (Japan)

Further reading

External links

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Key people
Involved companies
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