The retail industry in Singapore spans a wide range of businesses, from supermarkets and convenience stores to fashion and furniture. Buying and selling of goods and services take place through many channels such as stores, kiosks, mail and the Internet.
New technology, changing consumer tastes and borderless competition from e-commerce are shaking up the retail industry. Shopping is no longer confined to brick-and-mortar stores. This creates challenges, but also immense opportunities for retailers. With e-commerce, you can sell to customers anywhere in the world with an online presence.
To ready the retail industry for global competition, the Retail Industry Transformation Map (ITM) was launched in 2016 to encourage retailers to adapt and innovate to remain relevant. It aims to support highly productive retailers and globally recognised local brands. It also wants to expand retail to digital platforms, and grow the e-commerce share of total retail receipts from the current 3% to 10% by 2020.
If you are in retail business, you can cash in on opportunities in the “new retail” era, set up multiple touch points to interact with your customers, and use digital technology to make your business more cost-efficient.
New retail, a concept coined by Alibaba’s Jack Ma in 2016, wants to combine online, offline, logistics and data across a single value chain to give consumers more personalised shopping experiences 1.
An example is Alibaba’s Hema supermarkets in China. Shoppers use its app to scan for product information in-store, get recommendations, check out and pay. Cooked food stations turn purchases from live seafood into meals for consumers to consume in the supermarket. All the data collected helps it to customise its offerings to each shopper to attract return visits.
There are many possibilities in new retail if you think out of the box and offer unique shopping experiences to your customers. In new retail, shopping is more than buying items from a store; stores offer consumption experiences, not just products; and selling can take place wherever your customers are.
1 “Embracing China's New Retail”, report by Bain & Company, 13 March 2018
Omnichannel retail, or selling through multiple channels and ways, allows you to reach your consumers through many touch points. These include physical stores, websites, apps, social media platforms, or vending machines.
Businesses are increasingly using e-commerce and social media to reach and convert customers. In 2017, retail e-commerce sales worldwide was valued at US$2.3 trillion (S$3.1 trillion) and is projected to grow to US$4.9 trillion (S$6.6 trillion) in 2021 2.
Charles & Keith is one company that has used online platforms to enter global markets successfully without opening physical retail stores. It now ships to 42 destinations worldwide.
2 “Retail e-commerce sales worldwide from 2014 to 2021”, Statista 2018
Today, the majority of transactions still take place in physical stores. However, online activities such as pre-purchase research and post-purchase reviews have become important parts of the buying journey3.
Retail businesses are using automation, artificial intelligence, big data and augmented reality to manage both front-of-the house and backend operations in real time.
Commune, a local furniture design company, uses virtual reality simulation to bring customers into the interiors of their future homes. Decks Pte Ltd introduced a Radio-Frequency Identification system to manage its inventory and allow self-checkout. These digital solutions help companies become more efficient and result in more satisfied customers.
If you wish to know where your business is in the digitalisation journey, or get ideas on using digital technology, check out the Retail Industry Digital Guide for small and medium-sized enterprises prepared by the Info-communications Media Development Authority.
3 “Digital transformation in retail: transforming for the new commerce reality”, i-Scoop
Electronic payment or e-payment enables your customers to pay with credit/ debit cards, account transfer, e-wallet or QR codes instead of cash.
E-payment has several advantages for your business. It gives your customers alternative and more convenient ways to pay for their purchases. It also saves you time from handling cash and making trips to the bank. Your cashiers can take on higher value-added functions to serve your customers.
Implementing e-payment coupled with self-checkout options can help your business overcome labour shortage and become more efficient. This was what Food-Joy Minimart found out, when it implemented a 2-in-1 self-checkout and cash management system. Its customers were happier with shorter queue times, while its staff could take on other roles such as merchandising.
Going further, mobile payment – or paying through smartphone apps – is likely to become more popular as Singapore has one of the highest percentage of smartphone users. Be ready to woo and cater to digitally savvy consumers who may only carry e-wallets in their smartphones when they visit your store.
Make data-driven business decisions using tools to gain insights on the retail industry, understand your customers and benchmark your business performance.
Click here for more information.