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Singapore's Top eCommerce Product Categories

Amanda Lim

 

With Singapore’s mature digital infrastructure and a tech-savvy population flush with disposable income, it comes as no surprise that the country’s e-commerce economy is thriving. In 2017, a Visa study1 found that 78% Singaporeans shop online at least once a month. This is in part fueled by a GDP per capita of USD 63,990 in December 20192, according to the IMF* the highest among Southeast Asian countries.

Additionally, Google and Temasek’s report3 predicts that Singapore’s eCommerce market will grow from US$ 2.0 billion in 2018 to US$ 7 billion in 2025. That’s five times the industry’s value in 2016. As a cross-border eCommerce merchant, this positive outlook on Singapore’s market should also be good news for you if you want to expand your store into Singapore.

*accessed as at 28th January 2020.

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Singapore’s e-commerce boom is consistent with growth3 in other Southeast Asian nations. The region’s online shopping economy was valued at US$38 billion in 2019 and is expected to reach US$153 billion in 2025.

Singaporean’s Love of Online Shopping

For online merchants looking to learn more about Singapore’s eCommerce shoppers, these are a few factors to remember:

  • Out of the country’s 4.92 million internet users, 73 per cent have made an online purchase in the last month4 (based on a Q2 and Q3 2018 survey).
  • Of the top 20 websites by total visits and page views, four are eCommerce sites4: Qoo10, Amazon, Lazada, and Taobao.
  • According to Picodi5, millennials between the ages of 25 to 34 make up the largest percentage (46 per cent) of online shoppers in the country. This is followed by shoppers between 35 and 44 years old (22 per cent), 18 to 24 years old (17 per cent), and 44 to 54 years old (15 per cent).
  • Singaporeans especially like to shop during certain nationwide sales, major online sales, and important holidays.

Simply put, Singaporeans are prolific online shoppers. But what types of products are they buying the most?

Top eCommerce product categories in Singapore

When it comes down to figuring out what Singaporean shoppers like to buy online, it helps to look into the bigger picture and find out what product categories perform well in the island-nation’s eCommerce space. Although different market research reports offer different findings on the market sizes of these verticals, our research tells us that the top eCommerce product categories are:

  • Consumer electronics

  • Fashion and beauty

  • Toys, DIY, and hobbies

  • Personal care

While this overarching view can help identify the top product categories, no two shoppers, let alone country markets, have the same tastes. Let’s find out what you can do about this information after taking a deep dive into specific products that do well in each category.

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1. Electronics and Physical Media

Singapore’s goal of becoming a Smart Nation6 isn’t just a government initiative, it’s a lifestyle embraced by Singaporeans, right down to their shopping habits. This is a country that’s crazy about technology, as seen in the consumer electronics and media sector’s valuation of US$1.9 billion in 2020, with a 24.5 per cent year on year growth.7

We Are Social and Hootsuite’s findings4 are a bit more conservative, estimating electronics and physical media to account for US$1.08 billion in annual spending, edging out the fashion and beauty sector by a narrow margin.

Source: Hootsuite/ We Are Social


Among the most popular consumer electronics products sold online in 2018 were
wireless/Bluetooth speakers, smart wearables, activity watches (analogue), and OLED TVs.8 Meanwhile, Lazada’s best selling products in Singapore during its 11.11 Shopping Festival9 were the Logitech M220 wireless mouse, the Nintendo Switch, and the Xiaomi MI Roborock 2.

If consumer electronics happen to be one of your product verticals, it helps to pay attention to what Singaporean brands are doing on the eCommerce front in order to learn how you can take your slice of Singapore’s eCommerce pie. Local brands like Razer10 and Creative11, along with resellers like Courts12 and Qisahn13, are opting for an omnichannel retail strategy in order to capture a bigger market share.

Singaporean shoppers may either window shop offline before buying online, or click and collect with the option to try the product first before buying. This provides consumers in Singapore more ways to shop, meeting various needs like verifying the products’ quality or having various convenient ways to have their products sent to them.

The key takeaway from the omnichannel strategy is that these stores take into account the customer’s ability to try an item before committing to the purchase. So if you are running a purely online store, it helps to have a return policy for defective items. On top of this, established brands can also afford to provide deep discounts on platforms like Lazada, so this discount campaign may be something you can look into once your brand is established.

With that said, you may be hard-pressed to win over Singaporean customers easily. News about fraudulent sales of electronics via eCommerce14 are widely covered, which means Singaporean shoppers will be sceptical when an unknown brand or seller is introduced to the market. Because of this, you may need some time to establish your brand and earn your shopper’s trust.

Additionally, consumer electronics tend to be quite fragile. Nothing is worse than having your items damaged during transit before it arrives at your customer’s doorstep. Having the right packaging and the right shipping partner could help minimise the chances of these things happening, and ensures a good purchase experience for your Singaporean customer.

2. Fashion and beauty

Singaporeans have a healthy appetite for fashion and beauty products, with revenue for this sector amounting to US$326 million in 2020, growing by 9.9 per cent from the previous year.15

Aside from eCommerce platforms like Qoo10 and Zalora dominating this product category, Singapore is also a hotbed for Brand.coms and omnichannel retail stores. Some prominent names of these stores include Love, Bonito16, The Editor’s Market17, and Dressabelle.18

Looking at their product offerings, you would think that this product vertical only caters to Singaporean women. However, there are still notable brands that cater to men like Benjamin Barker19, In Good Company20, and Duxton.21 This corroborates with our previous findings that women only have a slight majority5 (57 per cent) compared to men (43 per cent).

While some of these stores started off as online blogshops, they have since expanded into the physical retail space, and newer brands are tackling the omnichannel retail strategy on the get-go. Thus, it would be wise to take note of the omnichannel retailing trend as an international eCommerce retailer.

Additionally, a report by PwC in 2016 found that the most popular out-of-country online purchases among Singaporeans were clothing and footwear22 (58 per cent). Compared to other Southeast Asian shoppers, Singaporeans are also the least price sensitive.23 This bodes well if you are selling mid-range or luxury goods, as Singaporeans can respect quality work and even share their satisfaction of your product with their peers if it exceeds their expectations.

3. Toys, DIY, and hobbies

Products in the toys, DIY, and hobbies segment are also massive in Singapore’s eCommerce economy, amounting to US$219 million this year24, growing by 7.8 per cent year-over-year. However, We are social and Hootsuite’s numbers4 are more optimistic, pegging the toys, DIY, and hobbies segment to US$658 million with a 40 per cent growth.

While Toys ‘R’ Us has shuttered stores around the world, it has done the opposite in Singapore, opening three locations in 2017 alone.25 But the company has also learned from the bitter lessons of its counterparts in the U.S. (the brand is operated as a separate legal entity in Asia) and launched an online store in 2015, which by extension beefs up its omnichannel retail strategy. According to Andre Javes, CEO of the toy retailer’s Asia arm, sales from its eCommerce platform outpaced brick-and-mortar stores on a year-on-year basis.26

 

There are a lot of different niches within the toys, DIY and hobbies category, each with their communities surrounding them. If your products tend to attract a community of niche buyers, it helps to have brilliant content and an active online community to act as your products’ advocates. To attract these communities, it helps to list on eCommerce marketplaces like Etsy, and buff up your inbound marketing strategy by having brilliant content that your niche community can relate to and engage with.

4. Personal Care and Food

Singapore’s online food and personal care sector is still the smallest vertical in terms of revenue, but it is also the fastest growing eCommerce segment in Singapore, growing by 47 per cent in annual spending from the previous year.

Source: Hootsuite/ We Are Social

In 2016, the U.S. International Trade Administration (ITA) also highlighted the potential of Singapore’s cosmetics and skincare retail sector27 for international brands, citing the presence of an affluent local population and a large concentration of expats who possess knowledge of international personal care products.

For instance, brands like Shiseido, SK-II, Timeless, and Colourpop are quite popular. Some of these are available in Singapore. For those that don’t have local sellers, consumers in Singapore are willing to have them shipped internationally into Singapore.

This means that if you’re able to build a following for your brand, you’ll be able to serve the Singaporean personal care market through cross-border shipping. By extension, if your brand becomes successful in Singapore, this can act as a launching pad to enter other markets in Southeast Asia.

Surprisingly, men are one of the key drivers of this growth, which should be another sign for your business to look into catering to male customers in the country.

According to a Shopee study28 that surveyed more than 3,000 male Shopee users in Singapore, an increasing number of men are turning to online shopping to purchase beauty and personal care products, including pomades, toothbrushes, and acne patches. Of those surveyed, 70 per cent said they shopped online more than they did the previous year due to convenience, better prices, and product variety.

This means that if you’re not currently selling to this customer segment, you could consider having a section in your online and/or offline store that caters to them.

Opportunities for International Merchants and Brands

As covered in our Singaporean shopper’s article, the opportunities for international eCommerce merchants to do well in Singapore lies in how they cater to Singaporeans’ online shopping motivations to shop online. PwC’s 2016 report29 explains that 55 per cent of Singaporean shoppers are motivated to purchase from overseas online retailers because of the lack of product availability within local stores.

Because of this, it helps to know who you are targeting within the Singapore market, and how you can differentiate your products and online shopping experiences from your competitors in Singapore’s market. If you haven’t already done so, building a buyer’s persona to better understand them might be a good start.

Once you understand who you can target, you can find out how to better serve their needs. If you’re targeting a niche segment, you can cater to their unmet needs in unique ways through your products or selling experience. If you’re going for mass market appeal, you’ll need to find ways to make your products cheaper and/ or better than your competitors.

In addition, each of these product categories will present its own barriers to entry, ranging from differentiating your product listing from fraudulent sellers, to finding methods for consumers to try samples before buying. So it helps to do further research into the challenges of selling a product category before diving straight in.

On top of that, cross-border eCommerce merchants can take advantage of the country’s developed digital infrastructure and liberal customs and tax regulations, like the high de minimis threshold of SGD 400 for the value of a single shipment via air freight. This is where a reliable logistics provider can be of great help, providing the expertise to make international shipping and online delivery for eCommerce two fewer problems to worry about.

 

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References

  1. Visa: Rise Of The Digitally Engaged Consumer 
  2. IMF
  3. Temasek: Google, Temasek, Bain & Company e-Conomy SEA 2019 Report
  4. We Are Social: Digital in Singapore 2019
  5. The Online Citizen: Singaporeans prefer to shop online using desktop rather than mobile device, according to Picodi survey
  6. Smart Nation
  7. Statista: Singapore Electronics & Media
  8. Euromonitor: Consumer Electronics in Singapore
  9. Lazada 11:11 Sale Press Release
  10. Razer
  11. Creative 
  12. Courts
  13. Qisahn
  14. Straits Times: Nearly 70% of electronics e-commerce scams in 2018 involved sale of mobile phones
  15. Statista: Fashion in Singapore
  16. Love Bonito
  17. The Editor’s Market
  18. Dressabelle 
  19. Benjamin Barker
  20. In Good Company
  21. Duxton
  22. My News Desk: Consumers in Singapore look to online shopping for cheaper prices
  23. IPrice: Singaporean Consumer Complaints About E-commerce
  24. Statista: Toys, Hobby & DIY in Singapore
  25. Today Online: Toy stores in Singapore thrive despite rise of online shopping
  26.  Today Online: Toys ‘R’ Us Asia to open more stores in region, including S’pore, after separation from US owner
  27. International Trade Association: Connecting You to Global Markets 
  28. Business Insider: 7 in 10 Singaporean men shop online more than they did last year 
  29. PWC: Total Retail 2016 – Southeast Asia & Singapore Highlights 
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