Bring­ing the mall to your doorstep

On­line shop­ping has rev­o­lu­tion­ized how we buy things and how busi­nesses op­er­ate.

HWM (Singapore) - - FEATURE -

Point and click

Say you want to buy some­thing. It could be a new lap­top, a gam­ing mouse, or even some­thing as mun­dane as hand soap. Is your rst in­stinct to head down to the store, or power up your PC?

To be sure, that’s a ques­tion that de­pends on your level of tech­no­log­i­cal savvy, but we’re will­ing to bet that many of you would fa­vor adding the item to a vir­tual cart in­stead of an ac­tual shop­ping bas­ket.

Con­sumers de­mand con­ve­nience, and the prospect of be­ing able to shop from the com­fort of your home, while still clad in pa­ja­mas and sport­ing aw­ful hair, is tan­ta­liz­ing. On­line shop­ping lets you u do that, and even com­pare prices across dif­fer­ent plat­forms. Bought a large TV? All it took was the click of a mouse, and you can rest as­sured that you picked what was to your knowl­edge the best price.

From Ama­zon to Lazada, there are now huge on­line mar­ket­places where you can buy vir­tu­ally any­thing, and have it de­liv­ered right to your door. This isn’t even lim­ited to gad­gets or house­hold items, and ser­vices like Red­mart and nd Hon­est­bee have sprung up to do yourour gro­cery shop­ping for you.

Many brands also have their own on­line stores, so you’re not just lim­ited to what on­line re­tail­ers bring in.

Fur­ther­more, you don’t even need your PC to buy some­thing. Most ma­jor on­line mar­ket­places have mo­bile-friendly lay­outs, and you can get your shop­ping done while ly­ing in bed with your smart­phone. On Prime Day 2017, an an­nual event where Ama­zon pro­motes its Prime sub­scrip­tion ser­vice with lu­cra­tive sales for mem­bers, the num­ber of Prime mem­bers who pur­chased some­thing in­creased by more than 50 per cent from 2016, with orders on the Ama­zon App more than dou­bling.

What’s more, many of these on­line re­tail­ers haven’t even both­ered to set up phys­i­cal stores. Bri­tish on­line fash­ion store Asos, whose name aptly stands for As Seen On Screen, ex­ists purely on the in­ter­net. How­ever, it con­tin­ues to go from strength to strength, with in­ter­na­tional sales growth es­ti­mated at 48.1 per cent in 2017.

In fact, ac­cord­ing to gures from the UK’s O ce for Na­tional Sta­tis­tics, nearly half of the to­tal spend­ing with on­line re­tail­ers in 2015 went to en­ti­ties such as Asos with no phys­i­cal pres­ence.

Ev­ery­one can get a slice of the pie

But it’s not just busi­nesses that are hawk­ing their wares on the in­ter­net. Con­sumers have been get­ting in on the game as well, on plat­forms such as eBay, Craigslist, and Carousell. These plat­forms make it easy to sell pre-loved or brand new items to buy­ers ea­ger for a cheap bar­gain, and add to the al­ready large va­ri­ety of goods you can get on­line. And then there are sites like Etsy, which al­low en­ter­pris­ing artists to sell var­i­ous vin­tage or hand­made items. These are usu­ally one-man op­er­a­tions, and with plat­forms like this, the bar­ri­ers to en­try aren’t that high at all. ] Ten­cent’s WeChat mes­sag­ing app also al­lows any­one to sset up an on­line store that can be ac­cessed in the app it­self. WeChat stores first opened in 22014, but in 2016, a good third of the app’s nearly 800 mil­lion users were al­ready mak­ing pur­chases from its stores. With so many av­enues to choose from, it’s hardly sur­pris­ing thathat brick-and-mor­tar stores nd them­selves los­ing eye­balls, and bod­ies, to their on­line coun­ter­parts. Con­sumers only have so much money to spend, and the more dol­lars they di­rect on­line, the less they have to spend in re­tail stores.

New Re­tail

Even more wor­ri­some for reg­u­lar brick-and-mor­tar out­lets is the fact that some on­line busi­nesses are not con­tent with just ex­ist­ing in vir­tual space. For all the hype and con­tin­ued growth that e-com­merce en­joys, Alibaba an­nounced in Jan­uary a US$2.6 bil­lion bid for de­part­ment store chain In­time Re­tail, a clear sig­nal of its in­ten­tion to ex­pand be­yond on­line re­tail.

There are even ru­mors of plans for a ve-storey mall in Hangzhou, which would host brands from Taobao, Alibaba’s ag­ship e-com­merce plat­form.

Alibaba isn’t alone in this, and on­line re­tail­ers like Bono­bos, Warby Parker, and lo­cal fur­ni­ture re­tailer HipVan have also laid down bricks in the real world. This points to­ward a new model for do­ing busi­ness, or what Alibaba CEO Jack Ma has re­ferred to as New Re­tail.

Ac­cord­ing to Ma, this is an in­te­gra­tion of on­line, offine, lo­gis­tics and data across a sin­gle value chain, with the cus­tomer at its core. By this rea­son­ing, the di­vide be­tween on­line and offine is false, and suc­cess in the next gen­er­a­tion of re­tail will de­pend on how deftly com­pa­nies uti­lize both chan­nels.

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