In a collaboration designed to benefit both partners, the U.S.-based retail giant Walmart and the Japanese online retailer Rakuten are joining forces to expand their capacities—and compete more effectively with Amazon. For Rakuten, already the largest online retail in Japan, the partnership offers an entry point into the U.S. market for e-books and audiobooks. By placing its existing offerings on Walmart’s website, it gains a vast potential audience with great promise for growth. On its side, Walmart earns a ready foray into the appealing Japanese grocery market. Japanese consumers rely heavily on online grocery shopping options, such that this market is worth more than $19 billion annually. Walmart has sought to dominate this market in the United States as well, but with this partnership, it gains an almost guaranteed position in a country that offers great potential. Along with these unique benefits for the new partners, the collaboration provides shared appeal because of its good chances for outcompeting Amazon. In particular, Rakuten hopes to challenge Amazon’s long-standing dominance in e-readers (e.g., Kindle), e-books, and so forth, while Walmart notes that Amazon has yet to really make a mark in the Japanese grocery market. But it is not as if Amazon is struggling in either country; the United States and Japan are its first and third largest markets in terms of sales, respectively.

Source: Sarah Nassauer and Mayumi Negishi, The Wall Street Journal, January 26, 2018