What’s the latest in eCommerce trends for 2022?
10 minute read
eCommerce has grown to become a fundamental cog in the retail framework. Amidst a global pandemic, global retail eCommerce sales have increased by more than 25%, with Asia being no exception to this rule.
eCommerce, also known as electronic commerce or internet commerce, is the act of purchasing and selling products or services online.
This kind of commerce is often used to describe the sale of physical products online but it can generally describe any kind of commercial transaction that is facilitated through the internet. In essence, the transfer of money and data is necessary to execute these transactions.
Keep in mind that e-businesses refer to all aspects of running and operating an online business while eCommerce refers only to the transaction of goods and services. And since the internet is growing, this industry has never been bigger and it seems like it won’t stop growing anytime soon.
If you want to be an eCommerce seller or are already running an online store, it is important to keep updated on the latest trends in this industry. Let’s take a look at trends that might reshape this gigantic industry and affect business growth in the days to come.
Overview:
What’s happening for eCommerce in Singapore?
Unfortunately, the COVID-19 pandemic has brought various unexpected events that have impacted the way we do business.
This year started with a low case count, but there has been a spike recently, causing tighter government measures. Restrictions include companies rolling out work from home (WFH) measures, ceasing social activities, and other various limitations.
However, this also means that people shifted to online shopping, and relying more on eCommerce. As a matter of fact, this is the main driver of Singaporeans behaviour shift and growth of this industry.
Interested to find out more about how Singaporean businesses from the eCommerce industry did during the circuit breaker period and beyond? Download our Sleek Index Report 2021 that covers this in detail.
Compared to other countries in Southeast Asia, Singapore experienced a huge eCommerce growth in 2020. According to the Digital 2021: Singapore report, the average Singaporean consumer spends approximately USD$785 more on online shopping than physical shopping.
Let’s compare that with other countries:
- Malaysia (USD$341)
- Indonesia (USD$219)
- Thailand (USD$216)
- Philippines (USD$91)
It’s thus not surprising to find out that Singapore experienced a huge eCommerce growth amidst the global pandemic. There was a huge eCommerce growth in 2020, with various eCommerce platforms having almost doubled in growth. According to various sources, online grocery purchases have gone up in addition to online purchases of non-groceries as well.
Offline retail recorded a decrease while online retail mushroomed for almost every company in this niche.
Having this in mind, you can rest assured that online shopping will remain a leading shopping method in Singapore if you decide to expand into this highly competitive market.
Popular eCommerce platforms
So, where can you sell your products in Singapore?
There are a few popular online eCommerce marketplaces in Singapore, but we’ll also mention some other self-hosted platforms:
- Zalora.This is a huge southeast Asia eCommerce platform previously owned by Rocket Internet.
- Shopify. This giant has over 1.5 million customers that regularly use its eCommerce website’s services.
- Magento eCommerce. Almost 700 businesses use Magento in Singapore to sell their products. The platform is becoming more and more popular and the creators place special emphasis on safety and security for every user (businesses included).
- BigCommerce.This is another good option for eCommerce businesses in Singapore. There are lots of built-in options that will make the whole business setup process go smoothly.
- WooCommerce.Using WordPress with a great eCommerce plugin called WooComerce will allow you to set up an online shop in no time. WooCommerce powers over 28% of all online stores across all industries.
- Squarespace. Even the biggest corporations rely on this giant when it comes to eCommerce.
Take a good look at these platforms to see which one would suit your business needs and requirements if you decide to open your doors to Singaporean customers one day. Include link to other eCom articles if necessary.
The state of retail and eCommerce in Singapore
Singapore’s retail industry was battling negative growth even before the pandemic. Retail sales in the country decreased by around 5% year-on-year in January 2020 for 12th consecutive months.
Singapore’s eCommerce platforms saw a 23% increase in total visits in the first six months of 2020. In a single online transaction in the first half of 2020, a Singaporean would spend S$113 online between January 2020 and June 2020.
One sector to note: Grocery markets
IGD Asia found that Singapore’s grocery market is performing well and is expected to hit S$9.9 billion in 2023. This is a noteworthy vertical with the growth of online grocery shopping is driving the most growth in the eCommerce industry as a whole, with companies such as RedMart and NTUC FairPrice at the forefront of eCommerce sales.
Many small traditional supermarkets have turned to social media channels and online marketplaces to promote products, conduct live auctions, and even develop customer relationships, such as providing advice on how to prepare dishes with their offerings.
What are the up-and-coming eCommerce trends in 2021?
Let’s go through emerging eCommerce trends that are changing the game in Singapore. Knowing these helps you to prepare to tackle every challenge and anticipate what may be in store for your business.
eCommerce trend #1 – Contactless payment
Contactless payment is the first on our eCommerce trends. It is a safe way for a customer to buy products or services using a debit or a credit card. These payments also include payments done through the NFC technology (using your smartphone or smartcard).
Even though this phenomenon was not so popular in its early days, more and more people have realized how convenient it is during the pandemic. This has sparked quick growth and the payment method is now a preference, not just an option.
So, it is only reasonable to expect that more and more customers will expect your business to provide this payment option even if you run a traditional store. Contactless payments are here and they are here to stay.
Don’t assume that contactless payments are only popular with younger people. In fact, the largest growth in both contactless preference and adoption happened among baby boomers, and COVID-19 only boosted this increase. This rise of usage and adoption of this method will definitely stay relevant in the years to come.
Last but not least, it’s worth keeping in mind that even though most contactless payments today happen through contactless cards, mobile wallets, and smartwatches, that may not be the case in the future.
It’s true that most payments of this kind utilise the listed devices above. But we are also seeing a rise in voice assistants, voice searches, home assistants, and smart speakers. This means that there are high chances that people might be able to make payments using their voice.
If we can already give voice commands to these devices, why shouldn’t we use them to make payments and buy items online?
eCommerce trend #2 – Rise of social commerce
More and more social media platforms are being transformed into shopping channels. This is mainly due to the fact that consumers are easily attracted to make a purchase when they use social media platforms such as Instagram or Facebook.
Experts call this phenomenon social commerce and it is taking the industry by storm. That’s why we listed it as one of the most important eCommerce trends. Social networks were previously a mere showcase for businesses, but now we have a situation where brands are capable of running the whole shopping experience without users being redirected to the actual business website. As a result, we should expect certain changes in the eCommerce industry’s normal pace.
Having a Facebook Shop or Instagram Checkout feature, from the perspective of a small business, will save a business a lot of money and resources as they establish their brand. The key brand messages, on the other hand, may get lost, which means that what makes your company special may not stand out on the platform. There is a need to balance brand awareness and product marketing for business owners.
But there is no denying that there is one big benefit to this: the improved customer experience. Delivering ‘frictionless commerce’ by decreasing the number of clicks is critical for eCommerce companies to facilitate purchases and increase conversion rates.
These ‘virtual brand marketplaces’ within Facebook or Instagram allow eCommerce brands to sell their items without the customer having to make additional clicks to complete the transaction. This is especially important since Generation Z doesn’t really have enough patience or the attention span that is required for a complex checkout process.
That is why an ambitious eCommerce store owner needs to recognize this as a great opportunity and take advantage of this trend while it is still in the making.
eCommerce trend #3 – AI will gain dominance
There is no doubt that the integration of artificial intelligence (AI) with eCommerce sites will stay one of the ongoing eCommerce trends. With AI, an eCommerce website will be able to predict what their customers are interested in and recommend similar or complementary products as they shop.
For now, AI makes it possible for customers to enjoy automated, customized shopping experiences. AI collects customer data on how and when customers make purchases, and what they’re seeking in a product or service regularly. It’s a technology that can’t be duplicated in a physical store.
Moreover, online shoppers don’t always distinguish between the experience of shopping online on an app (mobile shopping) and watching streaming television. This may influence what a shopper expects when they visit an online store.
When a consumer searches for a movie on Netflix, for example, he or she doesn’t see every film in the catalog. Instead, Netflix employs machine learning to provide personalized recommendations (in essence, a personalized shopping experience).
he same concept will be valid for online shoppers when they visit a store and search for a product. AI will make it easy for your store to recommend interesting and relevant items to a potential shopper even if they don’t look for them right away.
Of course, when talking about AI, it is only fair to also mention data. This is another major trend that will impact the eCommerce industry.
Obtaining data about a customer’s behavior and preferences was difficult in the early days of eCommerce. Collecting shopper information, as well as storing and moving that data, were big issues, as well as privacy.
But the technical challenges associated with data storage and movement have largely reduced. On top of that, personalization providers have become better at collecting data. A single provider can collect data about customers for multiple eCommerce websites, remove personal identifying information, and use what it learns to make better product recommendations.
Last but not least, you should also think about visual search. Seeing that 90% of data transmitted to the human brain is visual, it’s no shock that visual look is picking up energy as AI innovation proceeds to develop.
Though the visual look isn’t as compelling as content search in terms of effort to build this function, due to the gigantic information set required for the frameworks to learn, the picture acknowledgment showcase is estimated at $30.28B and set to grow exponentially within the future, with Google, Kiddle, and ASOS driving the charge. Having this in mind, it makes sense to optimize your website to work for future image-based queries.
To conclude, AI is changing the face of retail and e-commerce. Consumers are getting used to the high level of personalization that these frameworks give. AI-powered frameworks can obviously assist you to save money and make more profits by better understanding your current customers and potential customers.
Just think about the brands that have already started taking advantage of AI and machine learning. It doesn’t matter that most of them are not in the eCommerce industry because it’s only a matter of time when we will see a major breakthrough for this niche too.
So, be wise enough to expect it and stay prepared for it.
eCommerce trend #4 – Voice commerce on-the-go
ore and more people are buying voice assistant devices such as Amazon Alexa or Google Home. People rely on them to do shopping online, create reminders, wake up in the morning, play their favorite tunes, and so on. And this is how voice commerce came into life. Voice commerce refers to the ability to purchase things online using your voice and a compatible smart device (a phone or a speaker connected to the internet).
There is no doubt that more and more people will use voice assistants to buy items since it’s expected that voice commerce sales will reach $40 billion by 2022.
Considering that both Google and Amazon are developing software packages that include different languages for these devices, voice commerce will grow and it will grow worldwide, which is why it’s on our list of the eCommerce trends for 2021.
As an eCommerce business owner, you should think in terms of capturing more leads and making more eCommerce sales. To do so, you should optimize your top-level conversion funnel content to include answers to common questions that are common for your industry and your products.
Once you do so, you will attract new online customers because you have provided value through targeted content and that is what places them straight into your conversion path for when they start looking to buy later on.
Just think about it, something that might start as a quick voice search from an internet user looking for advice on ‘how to pick good running shoes’ might lead to them reading your blog post which, in turn, results in the sale of your running shoes.
So, don’t ignore voice commerce. After all, it will grow so huge that no one will even be able to ignore it. Do your best to implement conversational AI and take full advantage of what voice commerce can provide to your business.
eCommerce trend #5 – Environmental sustainability
More and more young people are becoming aware of what needs to be done for us to preserve nature and save this world. That is why going green is among the essential eCommerce trends for 2021 and a huge priority for your future key customers, the millennials and gen Zs).
That is why it’s important to follow your customers on this journey. Your business has to be aware of the environment.
Consumers are being more conscious about where they shop (be it physically or online) and the impact it has on the environment. Various studies show that almost half of shoppers want more sustainability in the fashion industry while even more want to see less packaging in order to save trees. This is also valid for plastic bags. People don’t want to use them since they take too long to degrade and dissolve.
As a business, you need to find a way to become more eco-friendly and go paperless if possible. When shipping items, use biodegradable packages, recyclable supplies, and make sure to let your customers know about it.
Feel free to talk about going green with your eCommerce business. Keep in mind that 9 out of 10 customers appreciate the online retailer’s honest communication with regard to sustainable offers. However, they also presume the trustworthiness of the supplier for not making misleading promises.
This means that you should only talk about sustainable aspects of your business if the customers can see them and feel the positive effects right away, and not make promises you cannot fulfil.
So, make sure to update your brand image, implement sustainable shipping, reduce packaging, focus on recycling, add products that support sustainability, and create an offset service charge at checkout. This should be more than enough for a start.
How do you start an eCommerce business in Singapore?
ingapore’s eCommerce industry is on the rise. That means that as soon as you go online with your business, you say goodbye to the normal hours of a conventional job. Your business will have to be there whenever its customers need it.
So, before you start, you should have a good business plan that caters to your customers’ needs. Conduct market research and determine the potential of your business and whether you can follow the biggest eCommerce trends.
Once you do that, put your plan on paper. This will guide your business later on. The blueprint needs to include what you want to sell, who you want to sell to, what you need to spend in the beginning, and how you plan to fund your business. It’s also wise to do some digging on your industry rivals just to see who you’ll be facing.
Once you do that, you need to select the right business structure. In Singapore, owners of eCommerce businesses and eCommerce stores usually choose to make their businesses a private limited company, sole proprietorship, or limited liability partnership.
Private limited companies offer the best choice to run online businesses in Singapore. A private limited company limits your liability to the amount you have invested in its shares, provides access to attractive tax incentives, and offers many other benefits.
But keep in mind that this is only available to Singapore citizens or permanent residents (and Entrepass holders).
Finally, you need to incorporate your business. This will be the official start of your business activities in Singapore. To do so, you need to:
- Come up with a name for your business.
- Hire one or more resident directors.
- Have between 1 to 50 shareholders.
- Ensure that you have the minimum paid-up capital.
- Ensure that you have a registered address in Singapore (not a P.O. Box).
- Hire a company secretary.
- Appoint an auditor (unless the company has been exempted from audit).
Besides this, there is also a list of legal requirements needed for incorporation. Thankfully, we’ve gathered them into a simple and comprehensive checklist that you can receive for free here!
Last but not least, many new businesses in Singapore are eligible to receive appealing tax incentives and exemptions. Do check if your business can benefit from this too.
Wrap up
To grow in the times to come, one has to adapt and adjust according to the latest and upcoming eCommerce trends. The rise of global eCommerce cannot be denied and that affects Singaporean businesses too.
However, this shouldn’t deter you. Singapore has proven time and time again that it’s an attractive business hub that can make a dedicated entrepreneur’s dreams come true. But it’s necessary to be prepared and anticipate everything that may come your way.
That is the only way to cater to your customers’ needs and win new customers that will power your business through the years that will follow.
Do you have a business idea? Don’t hesitate to contact us to start your eCommerce journey today!
