Rakuten Viber Case Study

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Rakuten focuses on 3 key initiatives to strengthen the existing market while creating new presence in new market. The Key initiatives are Cross border trading, Growing Eco-System and Grow market place business (See Exhibit 5). These initiative made them survive and retain their position in Asia markets. This strategy made them achieve their target customer in Asia market. Rakuten used cross border platform “RMS-G” in Asia to sell their products. Rakuten approach model is B2B2C (See Exhibit 6).

MOBILE APPLICATION RULING ECOMMERCE

Mobile commerce sales are expected to rise to $32 billion next year which will not only mark a massive increase from the $10 billion that was generated in 2012, but also account for over 7% of all Ecommerce sales. Responsive web design is essential to any Ecommerce retailer that is serious about the pursuit of success, however a catalog that keeps people interested (or a strong brand) could mean that an app is the more effective channel for driving revenue. As technology continues to evolve, so too will the growth of Ecommerce apps. One of the primary tactics that retailers utilize is figuring out a way to make it easier for a customer to purchase goods or services by simply tapping a button on their phone. Innovative technology like “Apple Pay” makes it possible for consumers to complete an in-store/in-app purchase by simply holding their finger to their phone for immediate identification and approval. This prevents the need for the customer to spend time waiting in line or having to walk through additional steps to fill out detailed information or personal data. Mobile apps also boost the in-store experience by streamlining multiple channels (omnichannel retailing) into a seamless buying journey for the consumer. Integrating a digital catalog into a retailer’s physical store can improve the customer experience and increase sales significantly by generating a simple way for the consumer to find and learn more about appealing products. For example, using an app-based QR or barcode scanner while in-store can allow the customer to discover more details about a product or see whether that item is available at a different store. Like having a high-performing, responsive site is just as important as investing in an app. This data also proposes that:

- 51% of consumers prefer shopping on the mobile web vs. using a smartphone app

- 58% of mobile retail revenue is predicted to come from the Web this year

- 82% of smartphone shoppers use their mobile browser to search for products in-store

- 62% of shoppers say they visit a mobile website directly vs. 21% who say they use a retailer’s app in-store

- The majority of retailers under-utilize their opportunity to sell through a responsive Ecommerce website

Mobile app will derive value in the ability to inspire customers into becoming return clients. For retailers that are looking to maximize their potential revenue and develop loyal clientele, obtaining a responsive Ecommerce website and a mobile app may be the best way to gain both.

VIBER IMPORTANCE

Viber is fighting in the other mobile application to present its growth to world. Other apps like Watsapp, Line and facebook messenger are gaining lots of customer base. Viber introduced and developed lots of new features to attract customers in other part of world. Viber don’t have market in Asia where other application ruling well. It is an individual app which have 300million users within two years after its launch and customized app which is mostly used for VoIP. This made it more important in Messaging platform

RAKUTEN IDEA

Rakuten is planning to improve its revenue and need to develop over the period. Now the trend in Ecommerce is changing to Mobile Commerce in which customers feel comfortable. Rakuten formulated a plan to develop an app for Messaging and VoIP. But to develop a new app and to make it popular need huge capital and promoting it is hectic because other mobile application have gained enough customers over the period. Rakuten when it became Globalized and made English as their official language begin look for opportunity outside japan. Rakuten want to huge customer base and need to flexible to integrate its idea of collaborating Ecommerce. This plan is formulated and Viber is found out by Rakuten from Middle East. The Viber is having good customer base and it is popular over the world except Asia market. It took as opportunity and began to formulate a deal with Viber. The rakuten is famous for its Diversity as core strategy. This leads Rakuten to acquire Viber which is having platform in text messaging and VoIP. Rakuten aim is to integrate Viber with its business model and promote its growth through Viber. Customers prefer Mobile apps than website.

RAKUTEN DEAL

Viber with its wide customer base of 300 million is ruling in it area. Rakuten on seeing it and formulated a plan. It began and planned to offer $3 dollar per customer and totaling of $900 million. The deal is given to Viber with full idea and Rakuten id ready to finish up the deal quick as possible when rakuten says OK for the deal.

VIBER ACCEPTING DEAL

Viber delivers the most consistently high quality and convenient messaging and VoIP experience available. Additionally, Viber has introduced a great sticker market and has tremendous potential as a gaming platform. Viber want to increase its growth and need to increase its user base as well. It don’t have huge user base in ASIA. Rakuten is one of most important internet companies of world. It is truly dominant in its home market Japan and has been growing rapidly over the years. Viber and Rakuten having same aspiration to be No 1 in communication platform, Considering all above points Viber accepted the deal and it is huge pay for them. This deal is one of the biggest and strategy based acquirement for Rakuten. Rakuten focusing on expanding its base through Viber and Viber is ready to give its base to Rakuten.

FINANCING DEAL

Once the deal is accepted by Viber and Rakuten Begin further process. Rakuten ready to pay full deal amount in cash to Viber. Rakuten acquired Viber February 13, 2014 by paying whole amount through wire transfer to Viber Account. The amount payment was decided by CEO and it is made by Rakuten Finance. The Deal made great added value to Rakuten by which instantly it customer base increased to 600 million.