The eCommerce landscape in Singapore has undergone a dramatic transformation in recent years. The proliferation of mobile devices and broadband connectivity has driven a boom in online shopping, with consumers increasingly turning to the internet for their shopping needs.
However, the Covid-19 pandemic has had a major impact on the eCommerce sector in Lion City, with many businesses forced to close their doors or pivot to online-only operations.
After the back-to-normal period, some Singapore trends are likely to emerge and you should know about them.
How did the pandemic impact Singapore’s eCommerce?
One of the most immediate and positive impacts of the pandemic on eCommerce was a significant increase in online shopping.
With people across the globe ordered to stay indoors, many turned to online shopping as a coping mechanism to get the items they need, leading to soaring sales in the industry.
The number of mobile internet users will possibly climb from US$5.39 million in 2022 to $5.68 million by 2025, according to Statista.
However, the pandemic has also created some challenges for E-commerce businesses. One of the biggest challenges was shipping delays due to increased demand for delivery services, as well as higher shipping costs.
Additionally, there has been a surge in eCommerce fraud. ScamAlert Singapore has reported that online scams cost the Singapore economy US$5.8 million with over 2700 victims as of 2022, and eCommerce scams always appeared as the top five scams of concern.
The current state of Singapore’s eCommerce
The pandemic has had a profound impact on eCommerce in Singapore. The most significant change has been the dramatic increase in online shopping.
Global eCommerce trends report conducted by JPMorgan indicated Singapore eCommerce currently made up 11 percent share of total retail. And there is 68 percent of Singapore people spent on online shopping.
Straits Times has reported that digital wallets will most likely take over credit cards in the coming years because 27% of the Singapore market is forecasted to use digital wallets by 2024.
The biggest international eCommerce platforms in Singapore include Shopee, Lazada, and Amazon. A striking highlight also reflects that cross-border eCommerce has gained much popularity in the online shopping culture of the city-state.
The current eCommerce sector in Singapore is relative potential, despite the challenges posed by the pandemic. Online sales have grown rapidly in recent years, and are expected to continue to grow in the coming years.
Various entrepreneurs have chosen Singapore as the destination for their eCommerce enterprise as this country offers:
- A certified digital-friendly prime location in an ideal business-friendly environment
- The leading international transportation hub
- Governmental supportive e-commerce business incentives
Read more details on how these characteristics benefit your Singapore eCommerce company.
Top Singapore eCommerce trends and forecast for 2023
As the world increasingly moves online, businesses must adapt their strategies to stay ahead of the curve. The eCommerce industry is booming in Singapore, driving this growth through several key trends.
- Mobile shopping trend and the support of ultra-fast 5G in Singapore
Singapore has high levels of internet and mobile penetration, with almost 90% of the population accessing the internet regularly. In addition, the population is large and affluent with many consumers having disposable income to spend on online purchases.
The already evident trend is the shift toward mobile commerce. With more people spending time on their smartphones and tablet devices, there is a growing demand for mobile-friendly eCommerce platforms and apps.
This trend is likely to continue in the coming years, as businesses increasingly cater to the needs of mobile shoppers.
Singaporeans are heavy users of mobile devices. Remarkably, the implementation of ultra-fast 5G in Singapore in 2023 is expected to leverage the growth of mobile shopping. Post-pandemic, retailers, marketplaces, and brands had a fall in website visits. Once customers returned to outdoor activities and shopped in stores, they purchased less online.
Nevertheless, the growth of mobile internet users still has a positive effect on mobile e-commerce revenue in Singapore. Based on Statista’s research, the total revenue will increase to over 6 billion USD by 2024.
- Singaporeans prefer cards for online payment
Clients tend to prefer flexible payment methods. The convenience along with the increasing availability of payment options during pandemics has led to the growing popularity of contactless payments. Credit cards and digital wallets are in favor.
Singapore has a high credit card penetration rate. This makes it easy for customers to make online purchases. Furthermore, buy now and pay later (BNPL) services that provide interest-free financing solutions are predicted to increase greatly in popularity.
Hence, eCommerce businesses in Singapore that provide various payment options are bound to encourage buying more and minimize cart abandonment.
Go through the pros and cons of the Top 5 eCommerce payment gateways in Singapore for online sellers including PayPal, Stripe, DBS PayLaH, Airwallex, and Paymate.
- Top eCommerce products categories set to boom for 2022
When it comes to eCommerce in Singapore, there are a few key product categories that are set to boom in the next few years. Here are some of the top eCommerce product categories that you should keep an eye on.
Clothing and fashion
This is one of the most popular eCommerce categories globally, and it is only set to grow in Singapore in the coming years.
Many factors are driving this growth, including an increase in online shoppers and a growing preference for convenient and hassle-free shopping experiences. Statista predicts that the revenue in Singapore’s apparel market will grow by 4.15% annually until 2026.
Consumer electronics with a revenue of up to US$2,356 million in 2023 (according to Statista) have become one of the most widely-used niches.
This is driven by a combination of factors, including the increasing popularity of online shopping, and the growing number of online consumers. These customers are comfortable making big-ticket purchases online, and the availability of a wide range of products.
Health and beauty
Increasing awareness of health and skincare products, and a growing preference for natural and organic products, have led to strong growth in the health and beauty category in Singapore as well.
Starting an eCommerce business in Singapore: Why not?
The eCommerce sector in Singapore is forecast to grow significantly in the next few years, driven by rising internet penetration and mobile usage rates. The year 2023 is projected to witness considerable growth in Singapore eCommerce.
This growth will be fuelled by continued investment in infrastructure and initiatives to support businesses and consumers alike.
With such a digital-savvy population, exploiting and expanding into Singapore as an advertiser or publisher presents a fantastic chance. And starting an online business will be a smart idea because of all the growth possibilities in the eCommerce environment.
Start reading to grow your Singapore E-commerce with minimal effort
If you’re planning to start an eCommerce business in Singapore but still have concerns about doing business in general, feel free to chat with one of our friendly consultants and receive practical advice or leave a message via firstname.lastname@example.org.
Disclaimer: While BBCIncorp strives to make the information on this website as timely and accurate as possible, the information itself is for reference purposes only. You should not substitute the information provided in this article for competent legal advice. Feel free to contact BBCIncorp’s customer services for advice on your specific cases.
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