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mCommerce in Singapore set for explosive growth in next five years

October 20, 2017 Financial No Comments Email Email

Despite its relatively low population, Singapore has outpaced its neighbours to become the third largest eCommerce market in Southeast Asia, but a saturation point may be on its way,  according to Worldpay’s annual Global Payments Report. The report found that the growth rate for Singapore’s eCommerce market is set to slow, as 73% of Singapore’s internet users already shop online.

Worldpay’s research, which analysed eCommerce spending patterns across 36 different markets on five continents, predicts moderate expectations for growth in Singapore’s eCommerce market, which is set to expand by 9 per cent to reach US$6.5 billion by 2021. In comparison, China’s eCommerce market is expected to grow by 11 per cent; South Korea should see 19 per cent growth and India is set to experience a 24 per cent expansion in its eCommerce market.

Despite decelerating growth for eCommerce in Singapore, opportunities will abound for capturing a new wave of mobile shoppers. Already leading Southeast Asia in smartphone and mobile broadband penetration, Singapore’s mCommerce market is set to grow 33 per cent in the next five years, according to the report. Cross-border shopping is also becoming more and more popular, with more than half of Singapore’s online consumers buying from international merchants.

Phil Pomford, General Manager for Asia Pacific at Worldpay, commented: “Retailers looking for a foothold to the future must prepare to deliver on a new set of demands in Singapore. Online shoppers are moving beyond the desktop, and beyond country borders. Savvy and well connected across multiple devices, they increasingly prefer to shop via mobile and want more opportunities to purchase from merchants around Asia, and the globe.

“In order to deliver on the demands of Singaporean shoppers who expect a convenient, seamless experience no matter how they shop, merchants must create mobile-friendly payments so that shoppers always get a simple and secure checkout experience. To capture more cross-border trade, merchants should offer a variety of currencies and payment options to help online shoppers feel comfortable and confident during the checkout process.”

In Singapore, shoppers still overwhelming prefer to pay with credit cards (66 per cent) but alternative payment methods are gaining some share of the payments market. Bank transfers and e-wallets are both set to nearly double in share by 2021, increasing from 11 per cent to 21 per cent and 13 per cent to 21 per cent respectively, according to Worldpay.

Pomford added, “Merchants should offer a variety of payment choices to capture Singapore’s voracious online shoppers, as alternative payments like e-wallets are set to win more market share. Our report also uncovered that 70 per cent of Singaporean internet users would shop online more if offered loyalty benefits – a great tip for eCommerce businesses looking to gain a competitive edge in the fight for share-of-wallet amongst Singaporean  shoppers.”

Worldpay has published a list of guidelines for merchants looking to capitalise on the eCommerce and mCommerce opportunity in Singapore and the wider Asia-Pacific region:

1)      One-click ordering: Consumers are more likely to shop more often with companies that save their payment details for one-click ordering. Merchants should provide one-click ordering to make online checkout as seamless as possible – especially via mobile apps.

2)      Consider the most popular payments methods in each territory, and prioritise those that complement your business model – there is no one size fits all in the Asia-Pacific region so you will need to understand the best options for your company.

3)      Cross-border trade: Merchants should ensure that they have local acquiring capabilities wherever they have a legal entity; offer a wide range of currencies at checkout; and consider local language customer support in their customers’ time zone to deliver a great customer experience.

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