E-commerce grew 20% for Costco in fiscal 2015—20 times faster than store sales.
Taking a page from its Japanese parent’s playbook, Rakuten.com Shopping will offer a week of sales next month as it aims to build brand recognition. The former Buy.com will also encourage shoppers to join its Super Points loyalty program.
Tokyo-based e-marketplace Rakuten Inc. will launch the first U.S. version of its “Super Sale” events this August, it says. The company aims to introduce more customers in the country to its brand by promoting the sale heavily both online—with one billion planned display ad impressions—and offline in traditional advertising venues, says chief operating and marketing officer Bernard Luthi.
“We’ll certainly use events like this to gain attention of shoppers and to hopefully garner their interest in Rakuten.com and what we have available for them,” he says. “It allows us to showcase the fact that we have millions of products from thousands of merchants.”
The Rakuten brand is still new to U.S. web shoppers. Rakuten in 2010 bought online discount retailer and marketplace operator Buy.com. In January it rebranded the marketplace to Rakuten.com Shopping and made it exclusively a selling platform for other retailers, putting it into direct competition with such established players as Amazon.com Inc. and eBay Inc.
Luthi says the August Super Sale is one part of the e-marketplace’s strategy to make more U.S. customers aware of its brand and to draw them into its loyalty program. In addition to offering deep discounts on thousands of items, shoppers also earn “Super Points” on purchases during the event, which equate to money off on future Rakuten.com purchases. Additionally, repeat purchases during the Super Sale will earn customers greater discounts—like 5% off a second item and 10% off if a shopper buys a third one, even a few days later, he says.
The retailer will also give away Super Points in a series of pre-sales before the August event to whet customers’ appetites and provide further incentive to return and use their points during the Super Sale, Luthi says. Shoppers can also play games to win points. For instance, throughout the promotions, customers can play virtual slots to win either Super Points or extra discounts to use on the e-marketplace, he says. “Really it’s about turning this into a fun shopping experience.”
In Japan, Luthi says Rakuten’s “Super Sales” typically last 24-48 hours and have become very popular, though he doesn’t say how much of the population participates in them. The U.S. Super Sale will “look like Black Friday in August, but running for a week rather than a day,” he says.
“We’re hitting a sweet spot in the retail environment, a point when many people are re-engaging in retail with back-to-school and starting to think about the holidays,” he says. While other retailers might be lying in wait for the busy fourth quarter, Rakuten sees the summer an opportunity to draw in shoppers without as much competition, he says. “The point of the Super Sale is to really take advantage of an opportunity area,” he says. “Black Friday will always be huge, but there’s no reason for that to be the sole annual event.” Rakuten may plan another Super Sale for early next year, perhaps right after the holiday shopping season has ended or after consumers’ Super Bowl preoccupations have died down, he says.
As it woos U.S. shoppers, Rakuten will also play up the backgrounds of its merchants and their unique stories a promotional practice that Rakuten considers a big differentiator from the competition, Luthi says. He previously worked for e-marketplace Buy.com, now Rakuten.com Shopping. “If you look at our web site even a year ago, it was a very product-centric, today’s daily deal type of site, but it’s become much more store or merchant-focused,” he says. “That’s the direction we’re going.”
Rakuten allows merchants to customize their store pages on the e-marketplace and it encourages them to communicate with consumers, he says. “The hero of our platform is not Rakuten, it’s the merchants. It’s about providing merchants the opportunity to own their brand and sell products the way they want.”