Rakuten vs Raymond Limited

Rakuten Market Stance

Rakuten is one of the most structurally complex and frequently misunderstood companies in global technology—simultaneously a major e-commerce marketplace, a bank, a securities brokerage, an insurance company, a credit card issuer, a streaming video platform, a mobile telecom operator, a professional sports franchise owner, and an investment company with stakes ranging from Lyft to Pinterest to Grubhub. Understanding Rakuten requires abandoning the single-vertical mental model that Western technology observers apply to Amazon, Alibaba, or Google and replacing it with a conglomerate-technology hybrid framework where the strategic logic is not vertical integration within a category but horizontal integration across consumer financial life through a shared loyalty currency. Hiroshi Mikitani founded Rakuten Ichiba in May 1997 as an online marketplace in Japan—three years before Alibaba, four years before Amazon's Japanese launch, at a moment when e-commerce was still a speculative concept rather than an established consumer behaviour in the Japanese market. The founding insight was not purely about e-commerce but about the nature of Japanese retail relationships: the deeply personal, trust-based connection between Japanese merchants and their customers that physical market culture had cultivated for centuries was, Mikitani believed, something an online marketplace could preserve and even enhance if designed with the right architecture. The marketplace Mikitani built differed from the Amazon model in one foundational choice that has defined Rakuten's character ever since: Rakuten's sellers are not hidden behind the platform but are visible, communicable, and relationship-building participants in what Rakuten explicitly calls a merchant-consumer community. Japanese merchants on Rakuten Ichiba operate branded storefronts—with their own page design, their own communication style, their own loyalty programmes within the broader Rakuten ecosystem—that carry their merchant identity rather than subsuming it to the platform aesthetic. This approach preserves the Japanese retail relationship culture that Mikitani identified as foundational to consumer trust and repeat purchase behaviour. The Rakuten Points loyalty programme, launched in 2002, was the strategic insight that transformed a marketplace into an ecosystem. Points earned through shopping on Rakuten Ichiba can be spent not only at the marketplace but across every Rakuten service—Rakuten Card credit card payments, Rakuten Bank savings account transactions, Rakuten Securities brokerage activity, Rakuten Travel hotel bookings, Rakuten Kobo e-book purchases, and dozens of other touchpoints. This cross-service points economy creates two effects: first, it gives consumers a financial incentive to consolidate their commerce and financial services with Rakuten rather than distributing them across specialist providers; second, it creates a data flow across services that allows Rakuten to understand consumer financial behaviour with a comprehensiveness that single-service companies cannot match. The financial services expansion was deliberate and sequenced. Rakuten Card was launched in 2001, became one of Japan's most popular credit cards, and by 2023 had over 30 million cardholders—making it Japan's most widely held credit card. Rakuten Bank, launched in 2001 as an internet bank, had attracted over 14 million accounts by 2023 and listed on the Tokyo Stock Exchange in April 2023 as a partially public entity valued at approximately 700 billion yen. Rakuten Securities, launched in 1999, serves over 9 million securities accounts. These financial services are not peripheral businesses grafted onto an e-commerce core—they are, by revenue contribution and strategic importance, the heart of the Rakuten ecosystem, generating the majority of group operating profit even as the marketplace continues to drive consumer acquisition. The international expansion history is the part of Rakuten's story most interesting and instructive from a strategy perspective. Mikitani's ambition to make Rakuten a global company was expressed through a wave of acquisitions between 2010 and 2015: Buy.com in the United States, PriceMinister in France, Play.com in the UK, Tradoria in Germany, Ikeda in Brazil, and Kobo in Canada for e-reading. The ambition was to replicate the Rakuten Ichiba community marketplace model in each of these markets, leveraging the acquired brands and user bases as launch pads for the full Rakuten ecosystem. The results were mixed, and several of the international marketplace operations were eventually wound down as competitive dynamics in Western e-commerce markets—particularly Amazon's dominance and local competitors' entrenched positions—proved more difficult to overcome than the Japanese market's structural receptiveness to the community marketplace model had suggested. However, the Kobo e-reader and e-book business achieved meaningful global scale, and Rakuten's North America cash-back affiliate marketing business (Rakuten Rewards, formerly Ebates) became one of the largest consumer cash-back platforms in the United States with tens of millions of active members. The most capital-intensive and strategically risky decision in Rakuten's modern history was the 2018 launch of Rakuten Mobile as Japan's fourth mobile network operator. Rather than operating as an MVNO (mobile virtual network operator) leasing capacity from existing carriers, Rakuten built an entirely cloud-native 5G-enabled mobile network from the ground up—a decision that required approximately 1.2 trillion yen in infrastructure investment over five years and produced significant losses as subscriber acquisition costs were absorbed before the network reached the scale required for unit economics to turn positive. The Rakuten Mobile investment thesis was that mobile data relationships create the highest-frequency consumer engagement touchpoint available, and that a Rakuten mobile subscriber who pays their bill through Rakuten Bank, earns points on their Rakuten Card, and buys from Rakuten Ichiba is maximally embedded in the ecosystem—worth significantly more in lifetime value than a customer who uses Rakuten for occasional shopping.