Providing seamless cross-channel experiences will be a key avenue for growth among retailers in Singapore, according to new data released by Adyen, a global financial platform for companies. As a result of investments made to their operations during the pandemic, businesses in Singapore are on the road to recovery: 68 percent of businesses across the retail, food and beverage (F&B), and hospitality sectors grew in revenue by 20 percent or more in 2021. Whether that’s shifting online, creating new contactless experiences, or booking systems for customers to visit stores, businesses in Singapore have led the way in embracing technology to engage with their customers.
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The Adyen Singapore Retail Report 2022, commissioned by Adyen and sponsoredby KPMG, interviewed over 40,000 consumers across 26 markets, including more than 1,001 from Singapore, to understand how they feel about the state of retail. It also surveyed 11,500 businesses across 23 countries, including 502 from Singapore, to learn about their concerns, aspirations, strategies, and investments for 2022 and beyond. It found that due to enormous pressure during the pandemic, almost all businesses chose to innovate when faced with adversity. What’s more, while restrictions are easing, 97 percent plan to invest more over the next year, more than the Asia-Pacific (APAC) and global averages (93 percent and 94 percent respectively).
With the pandemic shaking up daily lives, businesses had to innovate and adapt to survive, and technology became an enabler. With 68 percent of Singaporeans saying retailers used technology well to make products accessible, 67 percent feel that if retailers could sell across multiple channels during the pandemic (e.g. on their website or through social media), they should adopt the same flexible approach moving forward.
“Investments in back-end connectivity have paid off, and more than half of the businesses we spoke to told us that they’re now in a better position thanks to the investments they’ve made in the past year,” said Priyanka Gargav, Head of Commercial, Southeast Asia & Hong Kong, Adyen. “We’re confident that Singapore’s retail sector will thrive again, but the key to success will lie in businesses identifying the right areas for investments. New channels are always emerging and evolving in retail, so keeping back-end systems connected and flexible will allow retailers to capitalize on new avenues of growth.”
With an increase in consumer touchpoints online, digitally savvy Singaporeans have some of the highest standards when it comes to online experiences – higher than retailers think. While 59 percent of businesses say their customers have become less tolerant of poor online experiences, in reality, 73 percent won’t go back if they’ve had a bad shopping experience either online or in store.
The new demands on physical stores
While consumers have been engaging with and buying from brands on digital channels, physical stores remain an important touchpoint for Singaporeans. The good news is that businesses know this, with 51 percent saying they plan to increase their number of physical stores in the next year, more than the global (41 percent) and APAC (43 percent) averages. 55 percent also expect the proportion of revenue from these offline stores to increase. However, the catch is that consumer expectations of these stores have changed.
While shopping online is about convenience, Singaporeans expect shopping in physical stores to be about pleasure and excitement (69 percent). Technology has become an important differentiator to make this a reality, with 74 percent of shoppers more likely to shop with retailers that use technology to improve the shopping experience, higher than the APAC average of 64 percent. These enhancements could include offering new ways to pay, installing self-service kiosks, or using virtual reality (VR) or augment reality (AR) such as digital mirrors. What’s clear is that moving forward, businesses need to make sure that they design their physical outlets to be destinations for experiences, and not solely about products.
Safeguarding and maximising customer data for shopper convenience and business benefits
Findings from the 2022 Retail Report point to a need for businesses to offer cross-channel experiences, and there are multiple ways that they can create these. For example, they can enable customers to shop and complete transactions easily across online and offline channels, an area in which Singapore and Malaysia businesses are leading globally. Enabling shoppers to return items purchased online or in-store will allow retailers in Singapore to boost loyalty more than in most other markets. While Adyen’s research points to Singapore businesses being among the best in the world for enabling these seamless cross-channel experiences, there is still room for improvement.
Businesses must view digital transformation holistically and payments systems can be used to help break down any silos. According to the 2022 Retail Report, more businesses in Singapore are connecting their payment systems to other parts of their operations, compared with other markets. Done correctly, this puts them in a good position to improve backend processes and improve operations. In Singapore, 70 percent of businesses that connected their payments systems across the organisation grew by 20 percent and 79 percent that connect online and offline systems expect to grow by 20 percent or more in 2022.
Connecting payments systems also gives businesses access to real-time payments data of customers across all sales channels. Businesses can use these insights to better identify consumers, improve the customer experience and make better business decisions. What is important is how businesses collect and store this information. Although Singaporeans are among the most comfortable exchanging their data for something in return, such as a discount or special offer, they also want assurances from businesses that it will be kept securely, and their privacy will be respected.
With most businesses in Singapore planning to invest in improving their operations over the next year, it’s clear that they are optimistic about the future. Those that invest in the right solutions correctly will not only survive but thrive in 2022 and beyond.