Rakuten.com/shop was an

e-commerce E-commerce (electronic commerce) is the activity of electronically buying or selling of products on online services or over the Internet. E-commerce draws on technologies such as mobile commerce, electronic funds transfer, supply chain managem ...

marketplace based in San Mateo, California. Previously known as Buy.com, it was founded in 1997 by Scott Blum. In 2010, it was purchased by Japanese company Rakuten, and rebranded as Rakuten.com.Claire Cain Miller
"Buy.com Makes Its Biggest Sale Yet: Itself"
''

The New York Times ''The New York Times'' (''the Times'', ''NYT'', or the Gray Lady) is a daily newspaper based in New York City with a worldwide readership reported in 2020 to comprise a declining 840,000 paid print subscribers, and a growing 6 million paid d ...

'', May 11, 2010. This business was shut down by Rakuten in 2020.

History

Buy.com (1997–2010)

Buy.com originally sold only computers, at below cost, intending to bring in revenue through advertising and ancillary services such as sales of warranties and equipment leases, before expanding into numerous other categories, including software, books, videos and games. The company sold $125 million worth of goods and services in 1998, its first full year, beating

Compaq Compaq Computer Corporation (sometimes abbreviated to CQ prior to a 2007 rebranding) was an American information technology company founded in 1982 that developed, sold, and supported computers and related products and services. Compaq produced ...

's 1984 record for most first-year sales.Quentin Hardy
"The Death and Life of Buy.com"
''

Forbes ''Forbes'' () is an American business magazine owned by Integrated Whale Media Investments and the Forbes family. Published eight times a year, it features articles on finance, industry, investing, and marketing topics. ''Forbes'' also r ...

'', January 21, 2002. After raising $120 million from Japanese tech company

SoftBank is a Japanese multinational conglomerate holding company headquartered in Minato, Tokyo which focuses on investment management. The Group primarily invests in companies operating in technology, energy, and financial sectors. It also runs the Vi ...

in 1998 and 1999, founder Scott Blum sold a portion of his stake to SoftBank in 1999 shortly before Buy.com's $195 million initial public offering in early 2000.Sarah Lacy
"Back to the Future at Buy.com"
''

Bloomberg Businessweek ''Bloomberg Businessweek'', previously known as ''BusinessWeek'', is an American weekly business magazine published fifty times a year. Since 2009, the magazine is owned by New York City-based Bloomberg L.P. The magazine debuted in New York City ...

'', January 25, 2005. On February 8, 2000, Buy.com went public at $13 per share and rose to $37.50 per share that day, its peak price. Mr. Blum still owned approximately 48% of the company at the time of the IPO. Stock values dropped in the year following Buy.com's initial public offering, and it was delisted from the

NASDAQ Stock Market The Nasdaq Stock Market () (National Association of Securities Dealers Automated Quotations Stock Market) is an American stock exchange based in New York City. It is the most active stock trading venue in the US by volume, and ranked second ...

for failing to maintain a stock price above $1 per share. In February 2001, the UK arm of buy.com was sold to the UK department store

John Lewis John Robert Lewis (February 21, 1940 – July 17, 2020) was an American politician and civil rights activist who served in the United States House of Representatives for from 1987 until his death in 2020. He participated in the 1960 Nashville ...

, and the technology was repurposed to create a new transactional website for the John Lewis chain. In November 2001, Blum reacquired Buy.com for $23.6 million (about 17 cents per share), and took the company private. In 2002, Buy.com went beyond selling solely electronics, movies and music, adding more soft goods to their catalog, such as sports equipment, apparel, shoes, health and beauty products. It was at this time that Blum placed a full-page ad in ''

The Wall Street Journal ''The Wall Street Journal'' is an American business-focused, international daily newspaper based in New York City, with international editions also available in Chinese and Japanese. The ''Journal'', along with its Asian editions, is published ...

'' promising

Amazon.com Amazon.com, Inc. ( ) is an American multinational technology company focusing on e-commerce, cloud computing, online advertising, digital streaming, and artificial intelligence. It has been referred to as "one of the most influential econo ...

customers that Buy.com would prove to be the better buying option. This statement came shortly after Buy.com announced a 10% below Amazon.com cost on all books sold on the site and free shipping site-wide, with no minimum purchase required. At the time, Amazon had 25 million customers, approximately five times as many as Buy.com. In March 2002, Buy.com announced its first issue of ''Buy.com Magazine'', providing information about the latest electronic devices and computers, with four issues per year and a circulation of five million. The magazine was later converted into an all-digital publication. On January 25, 2005, Buy.com filed to go public again, before withdrawing those plans in May 2007. Buy.com officially launched a partnership with

eBay eBay Inc. ( ) is an American multinational e-commerce company based in San Jose, California, that facilitates consumer-to-consumer and business-to-consumer sales through its website. eBay was founded by Pierre Omidyar in 1995 and became ...

in April 2008, striking a deal to sell millions of items on eBay. Buy.com would quickly become the largest seller on eBay. Many independent sellers were upset that, unlike other sellers, Buy.com was allowed to sell on eBay without paying listing fees. From 2007 to 2009, the number of products for sale in Buy.com's marketplace grew from 2.3 million to 5 million, positioning it as the number two e-commerce site behind Amazon.com.

Rakuten purchase and rebranding (2010–present)

In May 2010, Buy.com was acquired by Rakuten, Inc., the largest e-commerce retailer in Japan,Omar Akhtar
"Rakuten: The biggest e-commerce site you haven’t heard of"
'' Fortune'', March 22, 2013. for $250 million in cash.Jay Alabaster
"Rakuten, Japan’s ‘Amazon,’ launches U.S. brand, the former Buy.com"
''

PC World ''PC World'' (stylized as PCWorld) is a global computer magazine published monthly by IDG. Since 2013, it has been an online only publication. It offers advice on various aspects of PCs and related items, the Internet, and other personal tech ...

'', February 2, 2013. This was considered Rakuten's attempt to enter the American e-retail market, and to compete globally with e-commerce competitors such as Amazon.com and eBay. At the time, Rakuten in Japan had 64 million members, and Buy.com had 14 million customers, mostly located in the US and Europe. Half its products were sold directly to customers and half were sold through other e-commerce businesses using its online store. On January 10, 2013, Rakuten announced the official rebranding of Buy.com to Rakuten.com Shopping, which became effective on January 31, 2013. On the site, rebranded as Rakuten.com, there were a series of unique virtual storefronts for shoppers to browse and connect online, with the focus on providing high quality, unique merchandise, and a shopper- and merchant-friendly experience. Each seller within Rakuten.com's marketplace can customize their page's layouts, photos and promotions, and can communicate with customers directly. With the rebranding, the site was populated entirely by individual merchants, whereas previous iterations of Buy.com had just a portion of the site devoted to independent sellers. Rakuten has also launched e-commerce sites in Germany, Brazil, France, China, Thailand, Malaysia, Indonesia, Taiwan, South Korea, Austria, Russia, Canada and the United Kingdom.Sarah Perez
"Rakuten Buys Ebates For $1 Billion"

TechCrunch TechCrunch is an American online newspaper focusing on high tech and startup companies. It was founded in June 2005 by Archimedes Ventures, led by partners Michael Arrington and Keith Teare. In 2010, AOL acquired the company for approximately $ ...

, September 9, 2014. On September 9, 2014, Rakuten announced the purchase of San Francisco–based online rebate site Ebates.com for $1 billion in cash. The acquisition of Ebates, a website that allows customers to earn cash back when shopping online with over 2,600 retailers, gave Rakuten.com additional presence in the US e-commerce market, as well as a way to offer items such as online e-coupons. In March 2015, Rakuten.com partnered with Bitnet to accept bitcoin as payment. On August 12, 2020, Rakuten.com sent an email to its customers stating that it would be closing its US operations as of September 15, 2020: "Rakuten's United States marketplace service located at Rakuten.com/shop will stop taking orders from September 15, 2020".

Controversy

In May 2013, some users started complaining about alleged fraudulent charges on credit cards after using their cards on Rakuten.com. In some cases, it was alleged that the victims' names, social security numbers, dates of birth and credit card information were used to open accounts at other online vendors. In response, Rakuten.com issued a statement that the company has undertaken significant measures to validate the security of the site, and that a third-party technical forensics investigation found no wrongdoing on their end.Laura Northrup
"Rakuten Is Taking Credit Card Fraud Complaints Very Seriously"
'' Consumerist'', June 10, 2013.

References

External links

* {{Rakuten 2010 mergers and acquisitions Companies based in San Mateo, California Customer loyalty programs Internet properties established in 1997 Online retailers of the United States Product searching websites Rakuten Retail companies established in 1997 American subsidiaries of foreign companies