Amazon vs. Rakuten: How Loyalty Points Beat Prime in Japan

How Japan’s homegrown giant is winning loyalty through culture, connection, and a digital ecosystem built on trust – and options.

In Japan, convenience often wears a local face. While Amazon is the most recognizable name in global e-commerce, its road to dominance in Japan has been anything but smooth. The challenger? Rakuten—a Japanese original that has quietly rewritten the rules of online shopping.

For over 25 years, Rakuten has taken a radically different path. The company plays a fundamentally different game to Amazon, leveraging a unique blend of merchant empowerment, cultural resonance, and a sprawling digital ecosystem that has proven remarkably resilient against the global e-commerce giant’s onslaught.

Founded in 1997, before Amazon planted its flag in Japan, Rakuten Ichiba built its empire by cultivating deep loyalty, not just with shoppers, but with the merchants who populate its digital aisles. It’s far from a simple clone; Rakuten’s success story reveals that it’s a key challenger to the one-size-fits-all model of global e-commerce.

The Vending Machine Versus the Virtual Shopping Mall

Amazon Japan mirrors the company’s global template: a closed system driven by scale, speed, and standardization. Fulfillment by Amazon (FBA) streamlines logistics, while product listings compete on price and placement within the platform’s algorithm. It prioritizes transactions—quick, seamless, and impersonal.

Rakuten operates more like a virtual shopping mall. It offers the infrastructure—digital real estate, payment processing, and customer access—but gives merchants full control of their storefronts. Sellers write detailed descriptions, build brand identity, and engage directly with customers. The result encourages browsing, not just buying.

This design reflects omotenashi—the Japanese ethos of wholehearted hospitality. Rakuten emphasizes care, detail, and personal interaction. It also avoids direct competition with its merchants by steering clear of private-label goods, unlike Amazon’s Basics line.

Loyalty as Infrastructure

Rakuten’s most powerful asset is its points-based loyalty system. Rakuten Super Points aren’t limited to purchases on Ichiba, its marketplace. They’re earned and spent across more than 70 services, including Rakuten Card, Rakuten Bank, Rakuten Travel, and Rakuten Mobile.

As of 2024, over 4 trillion points had been issued. Each point is worth one yen and functions as real currency across this ecosystem. Over 70% of users interact with multiple Rakuten services, reinforcing loyalty through everyday touchpoints. Consistently topping customer satisfaction charts in Japan, it counts over 100 million members – a staggering figure considering Japan’s population in 2024 was around 124 million – dwarfing Amazon Prime’s estimated local footprint.

Amazon Prime is widely used in Japan, particularly for fast shipping and video content. But its ecosystem remains narrower, and estimates suggest a smaller subscriber base—around 18.6 million users, based on third-party data.

Rakuten’s advantage lies in integration. The rewards loop keeps users inside the ecosystem, creating not just repeat customers but long-term participants.

Where Amazon uses content as a retention hook, Rakuten wields cross-service integration. Each point earned adds gravity to the orbit of services, creating a behavioural loop much larger than the sum of its many reward systems.

Mikitani’s Mission: Digital Optimism at Scale

Rakuten’s story is as much personal as corporate. In the aftermath of the 1995 Kobe earthquake, banker-turned-entrepreneur Hiroshi Mikitani left a prestigious post to build something new—something that could revitalize Japan’s economy from the ground up.

Ignoring widespread skepticism about e-commerce’s future in Japan, Rakuten’s founders poured $250,000 of their own money into building MDM, Inc. (renamed Rakuten, meaning ‘optimism’ in 1999). On May 1, 1997, Rakuten Ichiba (“optimistic marketplace”) flickered to life with just 6 employees and 13 merchants.

Mikitani’s core idea was revolutionary for its time: empowerment. He wanted to give small, regional merchants the digital tools to compete with giants, a direct challenge to the poorly executed internet malls run by large corporations. Rakuten offered lower fees (a flat ¥50,000/month initially) and unprecedented control over virtual storefronts and customer dialogue.

To support this model, Rakuten launched Rakuten University to educate merchants on succeeding online. This philosophy of partnership, not just platform provision, set Rakuten on a collision course with efficiency-first models like Amazon’s.

The Cultural Moat

Rakuten’s business model is deeply resonant with Omotenashi, the Japanese principle of wholehearted hospitality that involves anticipating needs, valuing meticulous attention to detail, and cherishing each interaction.

The extra effort sellers invest—long product pages, direct customer messaging, care in packaging—isn’t seen as bloat. It’s a form of respect, a signal of authenticity.

Even Rakuten’s tech stack is being retrofitted to reflect this ethos. In 2024, the company introduced “AI Omotenashi,” a push to fuse machine learning with the principles of traditional hospitality. Rather than wielding AI merely to push products faster, it’s being trained to anticipate needs, personalize journeys, and elevate the human touch at scale.

Tools like the “AI Universal Concierge” aim to replicate the attentiveness of an in-store interaction, powered by insights from a data-rich ecosystem.

E-commerce, the Japanese Way

Japan’s e-commerce sector is one of the largest globally, with estimates ranging from $200 to $380 billion. While Amazon is often seen as the revenue leader, Rakuten maintains a strong presence in marketplace volume. In 2022, Rakuten Ichiba held an estimated 23.3% share of domestic e-commerce sales.

Amazon may lead in overall traffic and revenue, but Rakuten holds ground through user retention and integration. Its marketplace requires more effort from sellers, but offers greater freedom and brand control—qualities that resonate in Japan’s relationship-driven retail culture.

What Rakuten Reveals about Global Commerce

Rakuten shows that success in e-commerce doesn’t require copying dominant models. Its evolution reflects a belief in ecosystems over platforms, trust over automation, and cultural fit over frictionless uniformity.

Rather than chase scale through conformity, Rakuten has built resilience through alignment. Its strength comes not from global expansion but from serving local needs deeply and deliberately.

This isn’t a variation of Amazon. It’s Rakuten—shaped by its market, true to its values, and confident in its course.