Driven by shifts in digital consumer behaviour, Singapore’s online shopping landscape has evolved from one-sided, transactional engagements, to become a more dynamic digital experience characterised by distributed storefronts, where messaging apps increasingly take centre stage.
SEE ALSO: Vuori opens in China, Hong Kong and Singapore
Conversational messaging has grown from being a “good to have” feature to a “must have” for brands looking to expand reach in Singapore. A recent survey found that 6 in 10 (62 percent) of Singapore consumers would like to make purchases directly through a conversational messaging app. In addition, close to 4 in 10 (38 percent) of Singaporeans shared that they would spend at least 20 percent more on a brand that offers conversational messaging.
WhatsApp has emerged as the platform of choice for Singaporeans to engage with their brands by a measure, as is the case with respondents in Brazil, Germany, India, Indonesia, and Mexico – 72 percent of Singaporeans indicate that they would make purchases over WhatsApp, with Facebook Messenger coming in second (40 percent), followed by Instagram (30 percent). Meanwhile, respondents from Australia, France and the US prefer leveraging SMS for conversational communication with brands.
“As trust becomes the key currency driving the new era of engagement, businesses that prioritise building trust over transactional engagements have a competitive advantage. Our latest research highlights the role of conversational messaging in solidifying relationships that generate both loyalty and bottom-line growth,” said David Coghill, Head of Solutions Engineering, APJ at Twilio. “Businesses’ focus has to shift from optimising clicks towards improving clients’ ability to connect and interact with them meaningfully through preferred messaging channels.”
Heralding a new era of distributed digital storefronts
The initial online shopping boom a decade of the late 2000s revolutionised the shopping experience, enabling businesses to scale faster than ever and reach a wider audience then they ever could before. With smartphone adoption and access to cellular data becoming mainstream, businesses across industries launched digital storefronts with a data-led approach, including A/B testing to figure out the best way to move consumers through the funnel. At the same time, however, plenty of the personalisation associated with a physical storefront was lost.
However, over the past two years, with the pandemic briefly suspending the operations of physical stores, many businesses have moved to bring the “high-touch” experience more commonly associated with traditional brick-and-mortars to their digital storefronts, fuelling the rise of the distributed storefront, powered by conversational messaging.
Simply put, a distributed storefront brings the best of brick and mortar storefronts, and e-commerce platforms. Where digital storefronts previously helped companies scale their brick-and-mortar storefronts online, distributed storefronts take this to the next level by allowing businesses to drive a personalised experience at scale, by facilitating conversations via the customer’s preferred platform.
Ultimately, the back-and-forth of an exchange helps create connection and fosters confidence in a brand’s commitment to service. Whether they’re interested, uncertain, or stuck on a problem they can’t figure out, consumers want to feel heard, so removing their ability to reply frustrates them. Being able to talk to their favourite brands on their desired platform thus adds a whole new level of convenience to the consumer journey, letting them discover, explore, and eventually purchase products on any channel they happen to be using.
Personal touch will be critical to the success of distributed storefronts
While the initial boom of digital storefront added unprecedented levels of convenience to consumers, the eventual proliferation of e-commerce apps over the years – from individual brands as well as online marketplaces – led to platform fragmentation, causing consumers to be overwhelmed.
Many consumers found themselves increasingly interrupted by promotional emails and pinged with nonurgent app notifications. In Singapore, almost half (46 percent) of consumers receive push notifications from at least five different brands. Overwhelmed by the constant stream of notifications, 6 in 10 (58 percent) shared that they would “sometimes” disable push notifications.
In order to maximise the full potential of distributed storefronts, brands must invest in collecting zeroand first-party data. This information, provided by customers themselves, will help a brand understand what matters to their customers the most—their pain points, their interests, and their communication habits. Saving this information and building rich customer profiles enables businesses to cut through all the generic noise constantly thrown at consumers and, instead, build trust with them.
“In a landscape where practically every brand has a digital storefront, businesses that offer an intuitive, genuine and interactive platform will stand out from the crowd,” said David Coghill, Head of Solutions Engineering, APJ at Twilio. “Ultimately, inflationary pressures and fears of a recession have meant that customers today are more deliberate in the decisions they make, and are keen to learn more about what they’re buying. The onus is thus on the brands to provide the level of interaction to meet the needs of curious customers.”
Notably, consumers also vastly prefer to interact with a human agent compared to bots. A recent study found that while three-quarters of Singapore respondents had at least one conversation with chatbots in the past month, the majority of them (71 percent) would rather talk to human agents than bots.
The effectiveness of bots were also called into question – only 41 percent of Singapore respondents said they could solve their issues with just a chatbot.
Trends that will drive the growth of the distributed storefront
As the world continues to work towards post-pandemic recovery and back to growth, the behaviours that consumers have built look set to stick. Singapore businesses would have to consider several macroeconomic trends in the midst of building their distributed shopfronts.
Firstly, as inflation persists, consumers will be more thoughtful about the purchases they make. Businesses should thus invest in meeting consumers where they are and delivering the real-time answers they need to inspire confidence, grow loyalty, and make informed purchasing decisions.
The progression of Gen Zs globally into their first professional roles, and with it a rise in disposable income, would also present new challenges and opportunities for brands. As the generation of digital natives, Gen Zs are more resistant to traditional ads than ever. To connect with this demographic, brands have to invest in the channels these customers prefer.
SEE ALSO: The first Mondrian hotel in Singapore to open in 2023
Ultimately, the definitive shift in favour of two-way interactions has created opportunities for progressive businesses to meet people’s needs across the customer journey and to develop methods of personalising experiences based on each customer’s needs, interests, and history. As distributed storefronts open new lines of communication in the same windows that people use for chatting with friends and family, businesses can show up with welcome, timely, and helpful exchanges. Doing so will build consumer trust in the business and its offerings, foster brand loyalty, and drive revenue.