With a scale of 1.22 trillion, this e-commerce market ranks third in the world

At the end of August last year , Temu launched its semi-hosting business in Japan; in October, Taobao launched its overseas APP "TAO". Recently, it was revealed that TikTok Shop plans to launch its e-commerce business in Japan in June this year.

This series of actions has undoubtedly attracted more attention to the Japanese e-commerce market. As the world's third largest economy, Japan's e-commerce market also occupies an important position globally. So, what is the charm of this market that attracts so many e-commerce giants to make plans?

The scale of e-commerce is the third largest in the world, after China and the United States.

Recently, Statista Market Insights released survey data on the e-commerce market in various countries. The data showed that the global e-commerce market was still led by China and the United States last year, with annual sales of nearly 1.5 trillion US dollars and 1.2 trillion US dollars respectively. Japan, with a market performance of 169 billion US dollars, ranked third in the world .

GlobalData is also optimistic about the performance of Japan's e-commerce market this year. Its latest report mentioned that Japan's e-commerce market will grow by 7.7% this year, with a total value of US$206.8 billion . Moreover, the growth trend of Japan's e-commerce market will continue from 2025 to 2029, with an average annual growth rate of 6.1%, and is expected to reach US$261.8 billion by 2029. Looking back at the performance in 2024, GlobalData believes that Japan's e-commerce market has grown by 8.4%, with a total market value of US$191.9 billion.

The strong growth of Japan's e-commerce market is closely related to the high Internet penetration rate, wide access to banking services, and consumers' strong preference for online shopping. These convenient conditions have led 76% of Japanese consumers to choose to shop online . In addition, cross-border e-commerce platforms such as China and South Korea are accelerating their entry into the Japanese market, bringing more diversified choices to consumers and stimulating the competitive vitality and innovation momentum of Japan's e-commerce industry.

Amazon dominates Japan's e-commerce market, with Rakuten close behind

In the current Japanese e-commerce market, Amazon can be said to be the well-deserved TOP 1. The "2025 Asian E-commerce Report" released by AnyMind shows that in the Japanese market, the top five e-commerce platforms are Amazon Japan, Rakuten, Yahoo! Shopping, Temu, and 7net .

Amazon has 67.24 million monthly users in Japan and 130,000 sellers, making it difficult for other platforms to compete with it. In 2024, Amazon invested more than 1.3 trillion yen in Japan, further enhancing its market influence.

Rakuten Shopping has attracted a large number of consumers with its points system and has become the second largest e-commerce platform in Japan. It is reported that in 2024, Rakuten's e-commerce revenue in Japan will reach 885.6 billion yen, a year-on-year increase of 10.8%.

Of course, there are differences between the two in terms of user profiles and operating models. Amazon is more popular with young people and price-sensitive consumers, and the entry threshold is more friendly to Chinese sellers and the process is simplified . According to Amazon's internal data, the number of Chinese sellers with annual sales of one million US dollars on the Japanese site has increased by more than 40% in the past year .

Rakuten is more popular among housewives and middle- and high-income groups, and has stricter review of Chinese sellers . According to information, Rakuten requires sellers to have at least one year of e-commerce operation experience in the Japanese market, and the products sold must obtain relevant certifications for the Japanese market. At the same time, because there is no Chinese mode in the background, the Japanese language ability of sellers is required to be high.

In terms of operating model, Amazon focuses more on products and single-page merchandise display, while Rakuten focuses more on brands and stores, and supports customized pages and a points system. In terms of categories, 3C electronics, home furnishings, and sports equipment on Amazon have more advantages; fashion clothing, beauty products, and household groceries are more popular on Rakuten.

It is worth mentioning that some sellers mentioned that Japan's Qutian ( under eBay) is also quite suitable for beauty products , and this platform has recently opened up to Chinese sellers. Data shows that the user group of Japan's Qutian platform is significantly younger, and female users dominate, accounting for as high as 78%. Therefore, the beauty category and fashion women's clothing series on the platform are quite popular.

China's Temu, SHEIN and other platforms also have impressive performance in Japan. Last year, Japanese media reported that (as of August 2024) Temu's user base had reached 91% of Amazon's; SHEIN's online user base in Japan also exceeded Uniqlo, becoming a new favorite among local female consumers.

Characteristics of the Japanese market and consumers

The advantages of Japan's e-commerce market, in addition to its strong growth momentum, also include the high spending power of its consumers. PCMI's research found that Japanese online consumers are willing to spend up to $455 on a single product, $77 higher than the global average of $378 .

This phenomenon is closely related to Japan's economic situation. Japan is a high-consumption country. As the world's third largest economy, its GDP has reached 4.3 trillion US dollars and its per capita GDP has reached 52,120 US dollars. This determines that Japanese consumers generally pursue high-quality goods and unique shopping experiences. Especially in the boutique category, Japanese consumers will pay more attention to the quality and design of the goods, so those selected goods on the e-commerce platform will have a relatively more stable market demand.

At the same time, the return rate of Japanese e-commerce is only 5% to 10% . This figure is much lower than that of markets such as India and the United States. This is related to the behavior habits and cultural background of Japanese consumers. Japanese consumers are risk-averse, so they will carefully evaluate and understand product information and merchant reputation before shopping. Japan's unique social culture - not to cause trouble to others - also makes many consumers think carefully before shopping and try to avoid returns due to their own reasons.

When operating in the Japanese market, the consumer psychology of Japanese consumers cannot be ignored . When making major purchasing decisions, Japanese consumers usually consult family, friends, colleagues and other people around them, and they trust products recommended by friends and influencers more. They regard purchases as a long-term investment, so they are willing to pay a higher price for the durability and high quality of the goods. In addition, loyalty programs and rewards that provide discounts and cash back benefits, as well as discount stores, are also very popular with consumers.

The Japanese e-commerce market also has risk factors that cannot be ignored. First, Japanese customs have strict control. If sellers do not understand local regulatory rules or fail to declare product information truthfully, they may encounter customs clearance risks such as inspection and withholding. Secondly, with the frequent occurrence of data leaks, Japanese consumers have significantly increased their attention to privacy protection. The RCEP e-commerce rules require companies to comply with the legal framework of the contracting parties to ensure the security of personal information. In addition, some sellers said that due to the depreciation of the yen exchange rate, the sellers' profits are also decreasing. At the same time, oil price fluctuations and increased labor costs have led to rising logistics costs, which are also squeezing profit margins and putting great pressure on small and medium-sized enterprises .

In general, like other e-commerce markets, some sellers say "I've made money", some sellers say "the market is too competitive", and some sellers say "without a supply chain, I'm just copying and pasting, and the platform is making a profit". But it is undeniable that Japan is an emerging market compared to the existing mainstream markets. In addition, the logistics, payment and other supporting facilities in the Japanese e-commerce market are mature and stable, and the cross-border e-commerce has great potential, which is undoubtedly an opportunity for cross-border sellers to try. For e-commerce sellers who want to enter the Japanese market, they must understand the market characteristics and formulate appropriate strategies to stand out in this market.

E-commerce scale

platform

consumer