Three ‘critical’ challenges Singapore retailers need to address

Cross-device use, “showrooming” and last-mile fulfilment are three critical areas Singapore retailers need to address, according to new research by performance marketing technology company Criteo Southeast Asia.

Conducted by Edelman Intelligence, the research looks at evolving shopping patterns among Singapore consumers. It found that Singaporeans across a broad age range own or have access to an average of 4.72 mobile devices, and three-quarters of them use these devices at least once a month to make online purchases.

Other key findings…

✺ 60 per cent of Singaporeans consider mobile devices to be their favourite shopping tool, while 95 per cent have used their smartphones or tablets to browse online catalogues in the past month.
✺ 54 per cent of consumers indicate that being able to shop on their mobile devices has caused them to spend more than ever before, with 80 per cent admitting to buying online on impulse.
✺ Travel-related products and apparel are the most popular online purchases, with each shopper buying across an average of 5.43 product categories.
✺ Nearly half of Singaporeans shop on branded mobile apps at least once a week.

“Singapore is a truly cross-device market, where most consumers – especially millennials – are using a combination of devices to shop, says Criteo Southeast Asia commercial director Alban Villani. “While some still rely on PCs to make payments, mobile devices are always by our side as the one consistent factor in all elements of online and offline shopping.

“This reinforces what we’ve been telling retailers for some time – they can no longer target individuals on just one device. Rather, they need to embrace technologies that deliver contextual creative experiences and messaging.”

He says brick-and-mortar must evolve into “click-and-mortar” as in Singapore the high incidence of showrooming reinforces the importance of multi-channel integration.

Other findings…
✺ To avoid crowds and queues, almost two-thirds of Singaporeans prefer to shop online during periods like the Great Singapore Sale.
✺ Half of local consumers also believe that online deals during the Great Singapore Sale are better than in-store promotions.
✺ Even when visiting a physical store, 60 per cent of local shoppers are browsing similar products online and comparing prices.
✺ 69 per cent of consumers end up buying the same product or service online rather than offline.
✺ Physical stores still have an edge in engaging consumers who want to touch or trial a product before buying. However, this advantage is eroding as 70 per cent of Singaporeans agree that augmented reality also allows them to “try” an item.

Seamless experience

“A few established online players are already using physical pop-up stores with exclusive collections and discounts to create a seamless online-to-offline customer experience,” says Villani. “Conversely, physical retailers looking to retain and convert customers must start integrating online channels, especially mobile-optimised sites or branded apps, and consider customer relationship management (CRM) data optimisation to better engage customers before, during and after store visits.”

To compete more effectively against international retailers, same-day or next-day order fulfilment should be a big focus for Singapore retailers, who can work with specialised local last-mile delivery service providers.

While Singaporeans shop on both local and international sites, 78 per cent buy from local sites because of delivery considerations, the research finds. Also, 60 per cent of buyers would rather have their purchases delivered than have to collect them.

“The research findings are pointing us to a future where offline and online shopping are no longer two separate business models,” says Villani.

Shopping will become an integrated experience. Retailers who offer mainly mobile shopping will need smaller stores as delivery comes directly from warehouses, which Villani says has implications for malls.

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