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In Japan, points aren’t just perks—they’re a way of life. Consumers have grown accustomed to earning, saving, and spending points on every type of purchase, from convenience store snacks to high-end electronics.
For eCommerce businesses, understanding this unique points-driven economy is essential to meeting customer expectations. Popular point systems like Rakuten Points, T-Point, and d-Point go beyond loyalty—they influence where and how customers shop.
The ability to earn and redeem points through digital wallets such as Rakuten Pay and au Pay makes these systems an integral part of today’s market. Merchants who recognize this can gain insight into the buying culture and potentially a competitive edge by aligning with the habits of savvy Japanese consumers.
How Point Cards Work in Japan
Point systems in Japan operate as incentive programs that reward customers with points for their purchases. These points accumulate over time and can be redeemed for future purchases, providing consumers with a tangible sense of value. To further encourage spending, businesses often run promotions offering double or bonus points during specific periods, which drives higher traffic and boosts sales.
Moreover, point systems are accepted and integrated across various industries and businesses in Japan, including convenience stores, supermarkets, restaurants, online shopping, and phone services.
Point cards are everywhere in Japan. According to a 2017 survey by the Japanese marketing company CCC (Culture Convenience Club), the average consumer carries about 21 different cards. However, managing multiple cards can be cumbersome, with many customers finding their wallets bulky and heavy. Many reported missing out on points because they left their cards at home. Thankfully, businesses have since integrated their point programs into mobile apps, allowing customers to easily earn and use points with their phones, streamlining transactions and reducing missed opportunities.
Popular Point Systems in Japan
Here are the most popular point cards in Japan as of 2024:
- Rakuten Points: The most popular loyalty program, used by 59.3% of consumers. Points can be earned and spent within Rakuten’s ecosystem, including its eCommerce platform and the mobile payment app Rakuten Pay.
- T-Point: Participated by 48.3% of consumers, this program started with Tsutaya bookstores and has expanded to convenience stores, restaurants, and online stores.
- Ponta Points: Used by 40.5% of consumers, Ponta Points are integrated with the au Pay system and can be spent at retail locations, eCommerce sites, and mobile services.
- dPoint: Associated with NTT Docomo and used by 38.9% of consumers, dPoints work seamlessly with d-barai payments and offer rewards across mobile services and retail. It is also available as a payment option on Amazon Japan.
- PayPay Points: Adopted by 38.1% of consumers, these points are linked to the rapidly growing PayPay payment app, which supports both online and offline payments.
Benefits of Point Systems for eCommerce in Japan
Implementing a point system can significantly improve the performance of eCommerce businesses in Japan. Here are five key benefits:
Increased Customer Retention and Loyalty
Point systems incentivize customers to return and make additional purchases. In a culture that values relationships and loyalty, point systems can transform casual shoppers into devoted regulars.
As customers earn points with every purchase, they are motivated to return, tapping into the Japanese appreciation for gamification and rewards. This cycle of loyalty fosters a strong connection to your brand, ensuring they choose your store over competitors, even when offerings are similar.
In Japan, customer relationships are often built over time. Engaging consumers through loyalty programs can significantly enhance their lifetime value. By nurturing these connections with consistent rewards, you create a loyal base that ensures long-term revenue. Insights from membership registrations, such as age and purchasing preferences, allow businesses to tailor their offerings and marketing strategies to resonate with Japanese customers.
Higher Average Transaction Value
eCommerce businesses can encourage larger order sizes by offering bonus points through promotions or for meeting spending thresholds. By offering promotions that reward bonus points for spending above certain thresholds, you can encourage shoppers to add that extra item. In Japan, where quality often outweighs the price, improving the shopping experience with redeemable points makes every transaction feel rewarding and perhaps aligns with consumer expectations.
Competitive Differentiation
In a market saturated with retailers competing on price, a point system can be your secret weapon for differentiation. Rather than just slashing prices, why not offer unique loyalty perks? Think exclusive rewards, tiered points systems, or special promotions that set your brand apart. This approach not only helps retain your current customers but also attracts new ones eager for those added benefits.
Personalized Customer Engagement
The data collected from membership registrations and point allocations offers valuable insights into customer behavior and preferences. By analyzing this information, businesses can create targeted campaigns that resonate with consumers and enhance service quality. This data-driven approach also helps identify at-risk customers, enabling timely interventions to keep them engaged.
In Japan, where attention to detail is crucial, personalized marketing makes customers feel part of an exclusive community. Whether through reminders about expiring points or tailored promotions for loyal shoppers, these interactions strengthen the bond between customers and your brand, encouraging repeat visits.
Improved Customer Trust
The Edelman Trust Barometer notes that brand trust is notably low in Japan. This presents a unique opportunity for businesses to utilize an effective point system. When customers see their purchases rewarded with points for discounts or exclusive offers, it creates a sense of appreciation.
This feeling of being valued can foster long-term relationships. Happy customers are more likely to share their positive experiences with others, especially in Japan, where recommendations hold significant weight. Building trust this way can help your brand gain credibility and loyalty.
Key Points Systems Merchants Can Leverage in Japan
Here are the top five point systems and how businesses can utilize them:
Rakuten Points Club
As Japan’s most popular point system, Rakuten Points allows customers to earn points that can be utilized across the entire Rakuten ecosystem, including Rakuten Mobile, Rakuten Travel, and the Rakuten online store.
By offering Rakuten points, merchants can tap into a massive user base, incentivizing customers to shop at their stores to earn points for essential services like mobile bills and travel bookings.
PayPay
PayPay is one of Japan’s leading payment apps, making it an excellent alternative payment method. By integrating PayPay, businesses can leverage its popularity to attract new customers. Merchants can activate promotional campaigns, send newsletters, and offer bonus points to encourage engagement and repeat purchases through this widely used platform.
T-Point System
The T-Point System is seamlessly integrated with SMBC banking and popular convenience stores like Family Mart. By partnering with the T-Point System, merchants can allow customers to earn points on purchases made through their websites. Customers can then use these points not only for online purchases but also for in-store transactions at Family Mart, creating a dual benefit that enhances customer loyalty.
Ponta Points
Ponta Points are widely associated with Lawson convenience stores. Merchants can integrate Ponta Points into their loyalty programs, allowing customers to earn 1 point for every ¥100 spent. Points can be redeemed for discounts on future purchases at Lawson or participating stores, enhancing customer satisfaction and encouraging repeat visits.
d-Point Club
The d-Point Club, associated with NTT Docomo, offers customers points for various services, including mobile payments and shopping. Customers can earn and redeem d-Points at Amazon, Family Mart, and many other retailers throughout Japan. By integrating d-Points into their payment systems, merchants can attract Docomo’s vast user base and increase customer loyalty through this versatile rewards program.
Point System Strategies in Japan
Regardless of the point system implemented, eCommerce owners should consider several necessary aspects. Here are strategies to maximize the effectiveness of loyalty programs:
Clear Communication
Provide clear and transparent information about how the point system works, including terms and conditions. This will build trust and encourage participation, making customers more likely to engage with the program. Of course, this means the information should also be available in proper Japanese.
Localized Rewards
Create a rewards program that appeals to Japanese consumers by offering points for purchases, social media interactions, and reviews. Tie promotions to cultural events and holiday periods like Christmas and New Year’s. Japanese consumers will expect holiday promotions.
Mobile Integration and Gamification
Ensure points can be easily viewed and tracked, especially on mobile. The system should also be easy to register for and use. Consider gamification features, such as tiered loyalty programs, to motivate customers with milestones and exclusive rewards.
Community Engagement and Collaboration
Engage with your customers directly to build a sense of community around your brand. Host product launches or seasonal sales to encourage customer interaction. Collaborate with businesses to create special promotions that offer joint rewards.
In general, offering a payment option with a mobile payment operator such as PayPay, Rakuten, and others will give merchants access to a merchant site to manage and offer promotions related to points.
Personalized Customer Engagement
Use analytics to customize marketing strategies. Personalize communications with reminders about expiring points and tailored promotions for loyal customers to strengthen their connection to your brand.
For example, offering targeted promotions based on past purchase behavior or sending personalized reminders for point expirations can improve customer interaction. In Japan, where attention to detail is crucial, such personalized engagement encourages customers to return and feel part of a community centered around your brand.
How Point Systems Are Evolving in Japan’s E-commerce and Retail Market
Point systems in Japan have emerged as a pivotal tool for driving customer engagement and loyalty. Moreover, it isn’t slowing down. The loyalty point service market in Japan is experiencing impressive growth. According to a survey by the Yano Research Institute, it is projected to reach approximately 2.8 trillion yen in 2024 and possibly 3.28 trillion yen by 2028.
Factors driving this growth are:
- Post-Pandemic Recovery: Consumer spending is rebounding to pre-pandemic levels, leading to an increase in the issuance of points across various sectors.
- Rise of Cashless Payments: The adoption of digital payment methods has significantly facilitated point accumulation and redemption, making transactions smoother for consumers.
- Increased Awareness: As awareness of the benefits of earning points grows, more consumers are actively participating in loyalty programs, particularly younger individuals who are tech-savvy and open to new experiences.
While traditional retailers have long dominated the market, new players from diverse sectors—such as finance and transportation—are entering it. Notable examples include JR East’s JRE Bank and Keio NEOBANK, which point systems to foster customer loyalty and provide added value.
This surge of competition is prompting companies to develop innovative strategies that provide real benefits to consumers while also creating new revenue opportunities for themselves. As businesses experiment with unique offerings, the focus on integrating point systems into their overall services is likely to grow. This will foster a more interconnected and cohesive experience for consumers, making it easier for them to engage with various services and rewards seamlessly.
Government Initiatives
Government policies play a crucial role in shaping the landscape of point systems in Japan. A notable example is the My Number Card point reward system, introduced in 2020 as part of efforts to enhance digital services and encourage citizens to engage with the My Number Card program. The My Number Card program is Japan’s national identification system designed to streamline administrative processes and improve service efficiency. Under this initiative, residents could earn points by registering for the My Number Card system or utilizing related online services.
Another significant program is Furusato Nozei, or “hometown tax,” which encourages residents to contribute to their hometowns in exchange for points. Through this initiative, participants can earn points based on their Furusato Nozei payments, driving increased engagement. Although the ability to earn points directly from purchases will be suspended in 2025, residents can still earn points through credit card payments and their proprietary point systems.
Additionally, eCommerce platforms like Rakuten and Aeon Mall allow consumers to utilize their points by directly making purchases related to the hometown tax. The integration of point systems with government initiatives not only fosters local development but also enhances the overall appeal of point-based rewards.
Points as Investments
A noteworthy trend in Japan’s point economy is the evolving perception of points as a form of investment rather than mere discounts. The rise of point management services, where consumers can strategically utilize their points for asset growth, reflects this shift.
According to the MMD Research Institute, approximately 23.7% of consumers are now engaging in investment using points, with younger generations leading the charge.
Consumers are starting to see points not just as rewards but as a way to manage their finances more effectively. This change opens up new opportunities for businesses to connect with customers on a deeper level. As point systems become more advanced, eCommerce businesses should consider adopting them to keep up with shifting consumer expectations and stay competitive.
Summary
Adopting point systems in Japan offers merchants a valuable opportunity to connect with consumers in a unique and competitive marketplace. Programs like Rakuten Points, T-Point, and d-Point are already ingrained in the shopping habits of many Japanese consumers, making them an effective tool for encouraging customer loyalty.
These systems not only incentivize repeat purchases but also help create a sense of value for customers. As shoppers earn and redeem points, they develop a stronger attachment to the brands they buy from. Integrating point programs with popular digital wallets enhances convenience, allowing customers to earn rewards during their transactions easily. This aligns with the expectations of Japanese consumers, who appreciate seamless shopping experiences.
A well-structured point system can foster lasting relationships and drive customer loyalty in a market where trust is essential. By engaging with Japan’s points-driven economy, eCommerce owners can gain a competitive advantage and create a loyal customer base.
FAQ
To choose the right points system for their business in Japan, merchants should first clarify their goals and the payment methods they offer. For instance, if they offer PayPay as a payment option, then PayPay Points would be a suitable choice; similarly, Rakuten Pay aligns well with Rakuten Points. Merchants should research various points systems, focusing on cost, flexibility, and the potential for building long-term relationships, which is vital in Japan’s business culture.
Points systems encourage customer loyalty, repeat purchases, and engagement. In Japan, consumers often seek rewards for their spending, and a well-structured points system can incentivize customers to choose one merchant over another.
Merchants can adopt the most popular points systems in Japan: Rakuten Points, T-Point, Ponta Points, d-Point, and PayPay Points. Each system allows consumers to earn and redeem points across various retail and online platforms.
Implementing a points system can confuse customers, making them hesitant to sign up because of the many loyalty programs available. For larger stores, it can also add extra work for staff, which could affect the quality of service if not managed well. Lastly, if there’s no clear plan to use customer data effectively, point distribution can lead to financial liabilities.
eCommerce owners in Japan should leverage multiple channels, including in-store signage, social media, and email marketing. Merchant centers provided by mobile payment apps will also have systems for point promotion. Highlighting the benefits of the points system, such as exclusive rewards or limited-time promotions, can attract and engage customers.
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