Rakuten announces expansion

Rakuten announces expansion

Tokyo-based Rakuten Inc has earmarked 100 million baht for expansion of its e-commerce business in Thailand over the next three years.

Mr Pawoot says consumer finance services are in the works for next year.

The move comes after its Tarad.com e-marketplace showed rapid growth since 2010 after Rakuten paid US$43.4 million in 2009 to acquire 67% of Thailand's Tarad Co, owner of Tarad.com.

"We'll start new businesses here next year, particularly consumer finance services, as Rakuten has strong experience with credit cards in Japan," said Pawoot Pongvitayapanu, founder and managing director of Rakuten Tarad.com, the local subsidiary.

He said credit cards would fit in well, as online shoppers could use the company's cards to make purchases on the website and collect loyalty points.

It eventually plans to shore up local teams to work on digital content acquired from Singapore's Viki Inc and Spain's Wuaki.tv, both providers of video-on-demand and streaming services. Wuaki.tv is a subsidiary of Rakuten.

Mr Pawoot said the company also planned to connect its local site to its global Rakuten platform comprising e-commerce websites in 15 countries and territories, mainly in East and Southeast Asia and including Taiwan, Malaysia, Indonesia, Singapore and Hong Kong.

"Thailand is Rakuten's second-largest growth market in this region after Taiwan," he said.

Connecting its global platform will enable local online merchants to sell their products and services internationally.

In the five years since Rakuten acquired Tarad Co, sales transactions on its website have risen by 1,800%, and this year the company expects 102% growth from 2013.

Tarad.com has 270,000 online merchants including 2,000 in its Premium Mall section, while member customers number 2.5 million.

Since 2010, the number of online shoppers on Tarad.com has increased significantly, with buyers aged over 40 increasing their proportion to 25% from 19%.

Purchases made via mobile now account for 35% of transactions. The proportion of credit-card payments has also risen to 49% of total transactions from 43%.

Mr Pawoot said Thailand had 31 million internet users, of whom nearly 10 million had made online purchases following the growth of e-commerce marketplaces over the past three years.

Despite the weak economy, the country's e-commerce market is expected to increase by 30% this year, up from an average of 20% in recent years, he said.

"The government's digital economy policy will boost the country's 400-billion-baht e-commerce industry as more SMEs are encouraged to sell online," Mr Pawoot said.

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