After being founded as an online shopping mall in Japan with five employees 15 years ago, Rakuten has grown into one of the world’s largest e-commerce companies, spanning internet shopping, banking and finance, and travel, with digital media plays into e-books and online video.

As of June 30 2012, the company employed nearly 9,000 people and had a market cap of US$13.7 billion.

“That’s quite close to Yahoo, both Yahoo Japan and Yahoo in the US,” said Toru Shimada, CEO of Rakuten Asia, speaking at The Asia Media Summit, held this year in Singapore.

“However there’s still a long way to become one of the major internet players,” he added, with Rakuten’s sizable market cap still smaller than other commerce-based digital players such as Priceline, Ebay and Amazon, as well as other online giants such as Baidu and Tencent from China and Facebook and Google from the US.

Global goals

Rakuten nurtures big plans, seeking to ramp up its share of gross merchant revenues from outside Japan to 70%, from just 10% today.

“Although it’s quite challenging, we would like to become one of the major global internet players with our unique business strategy,” Shimada said.

Rakuten feels its business differs from Amazon, the world’s biggest e-commerce company, by giving merchants more freedom to develop direct customer relationships, contrasting with the US firm’s more controlling approach.

Rakuten’s e-book reader, Kobo, also follows a more open-source strategy than Amazon’s Kindle, while Rakuten also recently led a funding round in image-based social network Pinterest, seen as complementary to Rakuten’s social commerce philosophy.

“We consult and invest with our merchants, as part of a mission of empowerment,” Shimada said, dubbing the model we-commerce rather than e-commerce.

New hub

Rakuten Asia, set up in June this year, is one of three new regional hubs covering all Rakuten business outside Japan, including areas such as digital media and online travel.

International expansion is a priority, with Rakuten seeking to set up operations in 27 markets worldwide as soon it can, from 20 today.

This includes a new business just launched in Malaysia, joining existing Asian operations outside Japan in Indonesia, Taiwan and Thailand.

E-commerce has proven to be a major driver of online development, energizing online ad markets with spend from new advertisers.

The development of backend infrastructure around payments and fulfilment meanwhile could also lay the foundations for the growth of TV shopping too.

These areas are proving the greater impediments to the growth of e-commerce however, even as rising internet penetration in Southeast Asia brings more potential buyers and sellers online.

This year's Asia Media Summit, organized and staged by Media Partners Asia (MPA), was held at the Capella Resort in Singapore. For a full report, with overviews of all the sessions on the day, please write to [email protected]