The U.S. arm of Rakuten Marketplace, formerly Buy.com, will shut down this year, the company told Digital Commerce 360.
The marketplace is owned by Japanese marketplace operator and ecommerce company Rakuten Inc. Customers can place orders on Rakuten.com/shop until Sept. 15, the company says. Its rebate and cash-back business called Rakuten Rewards, formerly Ebates, is staying open.
“We have decided to sunset the U.S. Rakuten Marketplace (Rakuten.com/shop),” a Rakuten spokeswoman says. “We made several changes in our U.S. business to strengthen our efforts in areas where we have a significant competitive advantage and the greatest opportunity for continued growth, which include our thriving Cash Back rewards, advertising and digital content business.”
Rakuten Inc. owns a number of global retail sites, most notably Rakuten Ichiba, a Japanese marketplace that sold more than $35 billion worth of merchandise on its site in 2019, Digital Commerce 360 estimates. Rakuten (including its U.S. operations) is ranked No. 10 in the Digital Commerce 360 Online Marketplaces database.
Rakuten Inc. purchased online general merchandise retailer Buy.com for $250 million in May 2010. At the time, Buy.com was No. 32 in the Digital Commerce 360 Top 500 ranking of the largest North American online retailers. Buy.com sold directly to consumers and operated a marketplace that accounted for 46% of its business at the time of its acquisition.
Rakuten Inc. acquired Buy.com as part of its strategy to expand beyond Japan and, specifically, to gain market share in the U.S. and compete with ecommerce leaders Amazon.com Inc. and eBay Inc. “On Amazon and eBay, you feel like you’re just listing your products on their marketplace,” said Hiroshi Mikitani, Rakuten founder, chairman and CEO, in an interview with Digital Commerce 360 in 2010. “We share the customer with our merchants,” Mikitani said in 2010.
In 2013, Rakuten Inc. rebranded Buy.com to Rakuten Shopping, redirected the Buy.com site to Rakuten.com and converted it to a pure marketplace (where all of its products were sold by third-party merchants) from a marketplace and retail hybrid like Amazon.
Rakuten says it does not disclose how many U.S. merchants are currently selling on its marketplace, but 1.5% of Digital Commerce 360 Top 1000 retailers sell on the U.S. Rakuten Marketplace in 2020. Comparatively, 42.7% sell on Amazon and 18.2% sell on eBay.
Rakuten Inc. purchased U.S. rebates website Ebates Inc. for $1 billion in 2014. Ebates, now called Rakuten Rewards on Rakuten.com, offers deals and cash rewards for consumers who shop with the company’s 3,500 retail partners, including Macy’s Inc. (No. 15 in the Top 1000) and Kohl’s Corp. (No. 21).