D2C brands and digital-first brands in Japan all want a bigger share of the ecommerce pie and their number continues to increase.
However, when it comes to online shopping in Japan, sites like Amazon and Rakuten are still immensely popular and influential among Japanese consumers.
In particular, Amazon’s sales grew exponentially during the pandemic and shows no sign of stopping, as more users embrace shopping online in Japan.
But a shift is occurring on the brand side of the ecommerce equation, when it comes to online marketplaces and online shopping malls, which is why we believe D2C brands are going to continue to continue to be aggressive in their quest for market share in 2022.
Indeed, more and more brands are weighing the costs of doing business on Amazon as merchants and selling on the Amazon marketplace.
The same goes for Rakuten and other online malls.
The cut of the profit that these online marketplaces take can really eat away at a business’ margins and this is encouraging more and more brands to try and establish their own direct-to-consumer operations.
In many cases digital savvy brands would rather sell directly to the end user and own the customer relationship rather than sell more, at lower margins, while also sacrificing their ability to grow a loyal brand following.
Finally, as we mentioned earlier, access to first party data especially is proving to be even more important after what brands learned post-iOS 14.5, and with third party cookies being gradually phased out on Google next year, it’s becoming more and more important for businesses to focus on their direct to consumer ecommerce sales.