In 2024, will Japan’s e-commerce market still be a good choice?
Industry Insights
Since the end of April, the yen's performance has been ups and downs, with the yen's exchange rate against the US dollar once falling below 160. However, against the backdrop of a weak dollar, the story took a dramatic turn. As of May 23, the Japanese yen exchange rate against the US dollar rebounded strongly, once climbing to a high of 153.57.
Faced with the continuous fluctuations in the Japanese yen exchange rate, many companies began to have doubts: Is it still a wise decision to develop the Japanese market in 2024?
01 Opportunities in Japan
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Economic strength
Although there have been constant voices about Japan's economic weakness in recent years, Japan has relied on its mature and stable economic environment to keep its GDP at the forefront of the world for nearly 40 years, proving its economic resilience and strength. According to the latest statistics from the Cabinet Office of Japan, Japan's nominal GDP in 2023 will reach 591,482 billion yen, equivalent to about 421.06 trillion U.S. dollars, continuing to sit firmly on the throne of the world's fourth largest economy. It is worth mentioning that Japan's per capita GDP also remains at a high level of 33,800 U.S. dollars, ranking 34th in the world, demonstrating the wealth and quality of life of its citizens.
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Population consumption power
According to the 2023 World Population Statistics, Japan's current total population is close to 125 million, ranking 11th in the world and sixth in Asia. Although Japanese society faces serious challenges of aging, the vitality of the e-commerce market is remarkable. According to data from the analysis company ecommerceBD, as of 2023, Japan has successfully become the world's third largest e-commerce market, demonstrating its strong consumption potential and digital development capabilities. Even more exciting is that forecast data shows that by 2027, the size of Japan's e-commerce market is expected to reach US$223.49 billion, with an annual compound growth rate of 9.8%, indicating that Japan's e-commerce market will continue to flourish and inject new vitality into the global e-commerce landscape.
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Internet penetration rate
According to authoritative data from Statista, the Internet penetration rate in Japan is as high as 94%, and the online shopping penetration rate has also reached 74.1%. What's more exciting is that it is expected that by 2025, this online shopping penetration rate will jump to 89%, indicating the continued prosperity of Japan's e-commerce market. This trend will undoubtedly bring unprecedented market opportunities to areas such as digital marketing, e-commerce and online payments, opening up a broad business space for related companies and innovators.
02 The booming mobile market
As we all know, Japan is not only world-renowned for its developed gaming industry, but also ranks among the world's third largest mobile app markets. Although Japan may not be a major market in terms of the number of users, it has been firmly among the top markets in terms of global consumer spending year after year. According to the latest data from data.ai, consumer spending in the Japanese app market in 2023 reached $17.9 billion, second only to China and the United States, once again demonstrating Japan's strong strength and market appeal in the field of mobile applications. According to AppMagic, the most downloaded apps in Japan in 2023 are:
- TikTok
- Mynaportal
- Myna Point
- TVer
- Temu
Among mobile applications, although mobile games account for the largest source of user spending, Japanese users use a wider range of mobile applications. They prefer communication, entertainment and public service apps, while shopping and online payments also occupy an important position. According to Statista Digital Market Outlook:
- 48.2% of consumers purchase services or products online every week
- 17.5% of consumers buy groceries and daily necessities online every week
- 7.1% of consumers buy second-hand goods online every week
- 17.8% of consumers use services such as online price comparison websites every week
- 6.6% of consumers use BNPL services every week
These diverse application demands demonstrate the wide range of preferences and high activity of Japanese users in the field of mobile applications.
03 Japan’s mainstream payment methods
According to the latest release from Statista Research, Japan has shown great diversity in payment methods, including bank card payments, mobile payments, and unique convenience store payment models. Consumers will flexibly choose the most suitable payment method based on the shopping location and amount. It is worth mentioning that PhotonPay has noticed that credit cards have become the most popular payment option for large purchases, while cash, e-wallets, and convenient QR code services are more popular for small transactions. This diversification of payment methods not only meets the diverse needs of consumers, but also reflects Japan's advancement and innovation in payment technology and services.
04 Why choose PhotonPay's local Japanese payment service?
For companies seeking to enter the Japanese market, keeping up with the payment habits of Japanese consumers and providing a convenient and secure shopping experience has become one of the key links to successfully enter the local market. PhotonPay provides a comprehensive, efficient and convenient payment solution, covering credit card payment, e-wallets (such as Pay-easy, Konbini), online banking transfer and other payment methods, which easily fits the habits of Japanese consumers.
- Konbini
The convenience store (Konbini) payment model caters to Japanese consumers' preference for cash payment.
After ordering goods or services online, users can choose to go to nearby convenience stores (such as 7-11, Lawson, FamilyMart, Ministop, Seico Mart, etc., more than 50,000 convenience stores) to pay in cash. This online and offline integrated payment model not only simplifies the transaction process, but also provides consumers with great convenience and security, so it is very popular among young people in Japan.
- Pay-easy
Bank transfer also enjoys a high reputation among Japanese consumers. Among 100 consumers who make online payments, more than 10 choose to complete the payment via bank transfer. Pay-easy, as a leading multi-payment network operator, is highly respected.
Pay-easy was founded in 2001. Whether it is online bank transfers through online banking or offline payments at bank ATMs, Pay-easy can support it. Its convenience of self-service payment and a high single transaction limit make Pay-easy the preferred payment method for merchants when processing high-value orders.
PhotonPay's service connection is simple, allowing merchants to quickly and easily access Japan's mainstream payment channels. At the same time, PhotonPay attaches great importance to payment security, and ensures the safety and reliability of every transaction through advanced risk control technology and security measures.
PhotonPay is committed to becoming your right-hand man in the Japanese e-commerce market, helping you to easily start a new journey.
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