As the year’s final mega-shopping event concluded, 12.12 saw brands and marketers broadening their revenue streams through customer-centric experiences that provide seamless shopping experiences, as Singaporean consumers make last-minute purchases before the GST hike set for January 2023.
SEE ALSO: A Cheatsheet: Everything you need to know about the 11.11 Festival
Criteo sales data recorded demand for big-ticket items relied highly upon in everyday life, such as electronics and appliances, like laptops and mobile phones, and their accessories in the region this year. Recent homeowners are also considering purchasing furnishings, household appliances, and kitchen supply equipment. During Singles’ Day 11.11 recently, online sales surged 205 percent in Southeast Asia, with Singapore seeing an increase of 263 percent from the month earlier.
While it has become customary for brands and retailers to provide massive discounts and offers on Singles’ Day, many know that it is merely a temporary solution for short-term convergence and reaching out to new customers. Retail in Asia had the pleasure to talk with Taranjeet Singh, Managing Director of Southeast Asia & India, Criteo. Together we discussed how brands and marketers can leverage AI’s power to reach and engage a wider pool of shoppers, the importance of hybrid shopping, and why brands should tap into omnichannel marketing to diversify revenue streams.
RiA: What are your predictions for the 12.12 shopping event and how will the impending GST rise impact consumer purchases in SEA?
Singh: According to Criteo’s sales index, online sales during the recent Black Friday increased by 223 percent from 2021, and Singles Day 11.11 also saw an increase in online sales of 223 percent compared to 2021.
Despite mega sales events such as 11.11 garnering more attention, this year, we see consumers regionally looking at sale opportunities all year round to enjoy savings and great deals. Criteo captured an increase in YoY for Black Friday in Singapore at 54 percent, whereas Singles Day saw a YoY decrease of 6.5 percent in online sales. While there are concerns over the rising cost of goods, consumers still show interest in participating in sale events. This spike is likely driven partly by last-minute purchases for the festive season and the looming GST hike coming into effect in 2023.
Our recent Criteo analysis found that big-ticket items products were rising as sales for electronics and appliances, such as multimedia projectors, laptops, and mobile phones, increased. Recent homeowners are also considering purchasing furniture and big home appliances such as vacuums and microwave ovens this year and will likely continue in 12.12.
Although unbeatable pricing during a mega sale holds weight amongst shoppers, especially during inflation, Criteo discovered that price is only one draw for consumers. What consumers are looking for is securing the best deal, including free delivery services, a good selection of product online, and flexible payment options that can entice a shopper’s interest and purchase a product.
For big-ticket items, flexible payment methods like (buy now, pay later) BNPL, which facilitate purchases and assist financial strains, would be a trend to look out for next year. Thus, we expect an increase in online sales for the 12.12 sale event in Singapore compared to the usual time in the year, as this will be the final shopping event for consumers to shop for meaningful gifts and last-minute purchases for the festive season happening at the end of the month.
Source: Justin Lim/ Unsplash
RiA: How can brands and marketers leverage the power of AI to reach and engage a wider pool of shoppers?
Singh: It is challenging to convince the consumer if we don’t know who we want to convince. Today, commerce media that utilizes commerce data and AI allows brands and marketers to identify their consumers who are in their shopping journey and who are most likely to convert. This approach enables brands and marketers to present a more personalized offer to customers, creating a unique buyer-seller relationship that would be difficult to achieve without AI and massive commerce data.
At Criteo, we practice the always-on customer acquisition channel that will help brands and marketers to continuously reach new and highly relevant customers to their business. By launching always-on customer acquisition tactics, brands can reach out to new customers year-round, not just during peak shopping seasons.
Through first-party data and AI, brands can implement continuous lookalike modelling in their campaigns to engage shoppers who look like their current existing best customers. By targeting customers who demonstrate strong shopping intent before anyone else, brands and marketers can inspire their customers to consider the brand first and ultimately make a purchase. Additionally, using these data, marketers may reach out to customers at every stage of their buying journeys with AI-based product recommendations.
RiA: Why does a hybrid shopping experience matter, and how can brands tap into omnichannel marketing to diversify revenue streams?
Singh: Our shopper survey in the Asia-Pacific region showed that two out of three consumers browse products online and then purchase them in a retail store. Similarly, this ratio is the same for consumers making purchases online after seeing the product at a retail store. This clearly shows that more consumers are embracing the hybrid way of shopping—carrying out their purchase journey across both online and offline channels.
It is easy to see why this trend is likely to stay as consumers enjoy the benefits of e-commerce, such as the ability to provide more choices to quickly compare with what an offline experience can provide, like lower in-store prices.
This is where brands need to relook at strengthening their omnichannel marketing. Omnichannel marketing delivers a consistent, personalized consumer experience across all channels and devices, from desktop to mobile, online to offline, and all other touchpoints. It’s a customer-centric strategy that allows brands and marketers to merge their offline data with their online data to reach their audiences better online.
To make the most of the return to in-store shopping, brands and marketers can use their offline data to find their physical-store customers online and understand their shopping behaviour. Brands can build personalised ads to drive customers to make their next purchase in their physical store. Through this, brands can maintain their existing pull of customers, target new ones, and optimize multiple revenue streams online and in-store.
RiA: Can you share some interesting insights obtained pre-12.12, based on the economic environment in Asia in recent years?
Singh: Despite the economic circumstances, consumers are taking the time to enjoy what they’ve missed out on over the last two years. While revenge spending may be down in the face of inflation, many still take advantage of life by utilising amazing offers. In APAC, for example, 56 percent of flights booked are international in 2022, up from 22 percent in the same period in 2021.
In Southeast Asia, product categories such as Baby & Toddler Swimwear (141 percent), Lingerie (87 percent), and Leotards & Unitards (77 percent) continue to be the top trending buying categories this summer compared to last year. Despite the uncertain economic situation, this indicates the overall resurgence of social life for many regional consumers.
We also observed that video streaming is the most popular advertising format among APAC consumers, with more than half surveyed in this region finding video ads exciting and having influenced their purchasing decisions in the recent year. Roughly three out of five consumers claim to check the promoted goods and services on their laptop, tablet, or smartphone and visit the advertiser’s website after watching a video ad which brands and marketers can consider when planning their campaign.
Source: Anantachai Saothong/ Unsplash
RiA: How should retailers improve their customer-centric experiences for online customers in this competitive season?
Singh: Criteo found globally that during the Black Friday sale, consumers are more likely to repurchase brands that provide a positive purchasing experience (41 percent in 2022 vs. 34 percent in 2021), and good customer service (39 percent in 2022 vs. 35 percent in 2021). Criteo data also showed that leveraging innovative customer-centric services, such as adopting BOPIS (buy online, pickup in-store) and ROPO (research online, purchase offline), is not new and has grown since 2019.
While the hybrid channel is valuable, online touch points usually precede offline events. Brands and marketers prioritizing always-on customer retention channels can invest in re-engaging their existing customers with personalized messaging by consistently segmenting their existing audience into hyper-focused groups.
By using precise data sets like shopping preferences and purchase behavior, brands and marketers may create new test-and-learn messages for their audiences, allowing them to address each with unique messaging and personalized ad experiences. As a result, always-on customer retention strategies will keep customers returning for more, resulting in a better lifetime value.
RiA: What is the importance of harnessing first-party data for personalization through AI?
Singh: More consumers are starting their shopping outside of the walled gardens with two out five consumers searching for products on the brand/retailer website. Hence, there is a need for brands and marketers to grow their first-party dataset with first-party solutions powered by AI to create a meaningful shopping experience while ensuring privacy-compliant.
First-party data enables brands and marketers to create scalable targeted, personalized advertising and experiences that address the ever-evolving consumer landscape, making it vital to the future of performance-driven, targeted, and personalized advertising.
Yet, using first-party data to engage consumers is more challenging. Brands require:
- A high volume of high-quality, first-party data
- To ensure their data is privacy-compliant
- Ways to turn their data into impactful advertising by activating and enriching first-party data with commerce data.
Once these are in place, brands can execute addressable advertising campaigns to reach consumers from discovery to purchase throughout their shopping experience. As a result, brands and marketers anticipate that technology and agency partners will play a significant role in assisting them in navigating the future of addressability.
SEE ALSO: What will be the key focus of 11.11 this year?
Nearly eight out of ten respondents (79 percent) in our global poll believe that IT partners will be crucial in assisting brands and marketers in managing data changes. While the path forward for addressability is challenging, marketers are prioritizing it and partnering with those who can help them find success in the long run.