Report comes as Degica looks to improve awareness and lower barriers for international e-commerce, starting with one of the world’s largest and lucrative markets
Tokyo: Western businesses are better placed than ever to break into Japan’s e-commerce market, worth more than USD 140 billion and growing in value at a rate of 9%, according to a new report – Japan: eCommerce Market and Payment Trends – by global payments company Degica.
With Japan’s inflation well below that of Western economies – 2.4% compared to 10.1% in the UK, for instance – the country’s economy remains strong. Meanwhile, with Japan standing as one of the most developed economies globally, the country’s cross-border e-commerce accounts for USD 18.2 billion, presenting a compelling opportunity for merchants looking to enter or expand into new markets.
“As a highly prosperous population, Japanese consumers can afford to buy items without significant worries about costs,” says Jack Momose, CEO, Degica. “With many economies currently suffering a considerable cost-of-living squeeze, diversifying into new markets offers new paths to growth – and by virtue of its size and strong economy, Japan is one of the most exciting markets in this respect.”
So where are the opportunities? For a start, the country’s e-commerce market ranks as the fourth largest in the world, and a number of western marketplaces, including Amazon and Yahoo! Shopping, are also established in Japan – meaning merchants can find a straightforward way in by working directly with these companies’ local subsidiaries.
Certain sectors are particularly strong. Both travel and food and personal care hold a significant 16% share of the country’s overall e-commerce market, while digital media products account for 15%. Fast-moving consumer goods (FMCG) are also popular, driven by several factors, including free shipping, affordable prices and coupons.
There is also an opportunity for brands to connect with customers through social media and by live-streaming sessions with influencers promoting their products, capitalising on the fact that 34% of Generation Z consumers shop on platforms like Instagram, YouTube and Twitter.
While Japan offers many opportunities, there are barriers to entry. For instance, there are multiple cultural aspects to selling in Japan that make this market unique, requiring an extensive knowledge of regulations and consumer behaviour, as well as access to very different payment methods to meet Japanese consumers’ expectations. But for those who understand how to localise their shopping experience to the Japanese market – whether it’s implementing local-language support, managing and preventing fraud risks or offering familiar and trusted methods for payment and delivery – the opportunity is vast. Degica’s “Japan: eCommerce Market and Payment Trends” report takes a deep dive into these topics, with the aim of helping merchants navigate this unique market.
“Our mission is to make Japan accessible to merchants worldwide,” adds Momose. “We live in extraordinary times where businesses are struggling to achieve growth in previously attractive markets, due to the rise in inflation and cost of living. Through this report, we want to share our expertise to encourage e-commerce companies to build their cross-border commerce strategy and show that, with a partner like Degica, previously difficult-to-access markets such as Japan are not only worth investing in but open for business and easier to work with than before. We want to play a leading role in bringing the world to Japan, and we hope this report provides a solid foundation for successfully selling in Japan.”
What you will find in the report:
● Facts and figures related to demographics, economy and ecommerce
● Payment methods breakdown per type of payments, instruments and brands
● Interviews with local players – Paidy, PayPay and Rakuten Pay – on their business model and factors of success
● Industry trends and latest developments, from public and private initiatives to emergent customer behaviours
● Ecommerce opportunities and cultural differences to consider
● Ecommerce fraud and online fraud prevention insights
● Logistics, fulfilment and return policies
● Laws and regulations for merchants to know before operating in Japan
To learn more, download Degica’s new report here: Japan: eCommerce Market and Payment Trends.