Yahoo Auctions in Japan

Yahoo Auctions in Japan
Case Code: BSTR309
Case Length: 17 Pages
Period: 1999-2008
Pub Date: 2009
Teaching Note: Not Available
Price: Rs.300
Organization: Yahoo
Industry: Internet & e-commerce
Countries: Japan
Themes: E-commerce
Yahoo Auctions in Japan
Abstract Case Intro 1 Case Intro 2 Excerpts


Yahoo in Japan

Yahoo Japan was incorporated in January 1996, and in April 1996, a joint venture was signed between SoftBank and Yahoo according to which both the companies agreed to develop and manage the Japanese versions of Yahoo's websites, and conduct other businesses (Refer to Table II for the objectives of Yahoo Japan). SoftBank initially held a 60% stake and Yahoo held the remaining 40% in the company...

Yahoo in Japan Auctions

Though online auctions were popular across the world, they came late to the Japanese market. Initially, Yahoo Japan was not enthusiastic on offering online auction services. Inoue was skeptical about starting online auctions as the Japanese were generally status-conscious and he doubted whether they would buy used goods from strangers. However, in April 1999, Inoue had a meeting with Yang during which they discussed eBay's impending entry into the Japanese market...

The Secrets of Success

Traditionally, the Japanese were averse to using second-hand goods. They also avoided buying old goods because they believed that the bad luck, if any, of the previous owner would rub off on the new one. Further, retail space in Japan was very expensive, making businesses dealing in used items unviable. Due to these reasons, there had never been an organized market for second-hand goods in Japan. In fact, people had to pay to dispose of used items even if they were in good condition. However, by the mid-1990s, with recession setting in, analysts were of the view that there could be a huge underlying demand for a forum where second hand items could be displayed, bought, and sold...


Yahoo Japan Auctions, though successful, did face its share of controversy. In one instance in 2006, more than 200 Yahoo Japan Auctions users did not receive jewelry items from an Osaka-based jeweler who listed on the Yahoo Auction site, even when they paid for them. Apparently, the jeweler had discontinued operations...


Exhibit I: Yahoo Japan - financial Trends
Exhibit II: Top Websites in Japan* - August 2007
Exhibit III: Yahoo's Acquisitions
Exhibit IV: Yahoo's Business Activities (as of 2007)
Exhibit V: Yahoo Financial Summary
Exhibit VI: Softbank - Business Segments as of 2007
Exhibit VII: Softbank - Financial Highlights
Exhibit VIII: Yahoo Japan's Strategy
Exhibit IX: Web Page of Yahoo Japan Auctions

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