What you need to know before doing business online in Singapore

Singapore is widely known as one of the best cities to do business. Its stable political and economic climate, network-ready environment, transparency, and skilled labour force are some of the accolades pegged to the small island republic’s brand. As a result, the city plays host to many international brands who leverage its strategic location and competitiveness as their global and regional hub.

Driven by increased internet access via mobile, lower prices and greater selection of products and services, rising rental rates, and labour crunch, ecommerce revenues are expected to reach $4.4 billion in 2015. Singaporean consumers have truly embraced ecommerce, with one fifth of Singaporeans surveyed by Fedex allocating up to half of their monthly discretionary spending on online shopping. By any measure, the market is primed for businesses with a smart e-retail strategy to make strong inroads. So, how do companies make the most of these promising trends?

Why internet performance?

If you want to be a strong player in the online business space, you need think about how your customers connect to your company and ensure all customers have the same online experience. Recent research has shown that Singaporean customers who shop online have a low tolerance for factors such as slow and unreliable websites – a characteristic that is echoed by users in other strong e-retail markets. Companies with a strong view into their internet performance are in the best position to provide consumers with the online experience they expect, and ensure they are a current and future buyer.

Availability and reachability

Your customer expects to be able to reach your website 24/7. While businesses operating online have traditionally focused on availability, which is measured in uptime, most companies haven’t invested a lot of time in ensuring their customers can actually reach their website from various locations. If customers in a particularly large market — for example, China — can’t reach a company’s website due to an internet outage or DNS error, it’s not necessarily the company’s fault, but the company will suffer business consequences such as lost sales and customers.

ROI example:

An hour of downtime costs businesses anything from $140,000 to $540,000 per hour. In 2013, Singapore telco M1 suffered a three-day disruption due to a power fault, resulting in Singapore’s worst network outage thus far, and was fined S$1.5 million by the local ICT regulator.

Speed

Just a three-second delay can mean the difference between a loyal customer and a lost customer, according to recent research from Dyn. Most consumers don’t abandon online shopping sprees because they change their minds or run out of time to make their purchases. Slow websites are what get in the way of completing a purchase. Less than 50 percent of consumers in Singapore would be willing to give slow websites a second chance, while 41 percent of consumers will go to another website to make a purchase.

ROI example:

Fast Company reported that a page load slowdown of just one second could cost Amazon $1.6 billion in sales each year. Google has calculated that by slowing its search results by just four tenths of a second they could lose eight million searches per day—meaning they’d serve up many millions fewer online advertisements. In the Amazon case, this loss is seven per cent of annual revenue.  For a $50 million company, this would equate to a $3.5 million loss.

Mobility

The importance of a solid online presence is compounded by two facts. One, as much as 50 per cent of Singapore’s ecommerce traffic comes from mobile phones, with smartphone penetration currently at 92 per cent. Two, cross-device shopping, or using multiple devices to visit a single retailer in the run-up to a purchase, is becoming increasingly prevalent in Asian countries, with mobile phones being the most commonly used device. Southeast Asia is currently the fastest-growing region globally for this trend.

Recent findings indicate that 89 percent of Singaporean customers expect the same quality and speed of performance when shopping on their mobile devices as they do when shopping online.

ROI example:

Fashion and beauty retailer Zalora knows this too well. It launched its iOS and Android app two years ago and it has not looked back since. The company revealed that a quarter of its revenue comes from mobile devices, with approximately half of the mobile revenue comes from tablets, while the other half comes from smartphones. For countries such as Singapore, mobile visits contribute to approximately 40 percent of its total visits.

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Summary