While online transition was met with hesitation initially, e-commerce players have been guiding the digitalization of merchants across the Asia Pacific region during the pandemic.
COVID-19 has accelerated the digitalization of businesses at unprecedented rates, with 83% of companies globally placing increased emphasis on their digital transformation efforts in light of the soaring demand for seamless interactions.
According to Bain and Company, by 2025, digital payments are projected to make up 67% of total transaction values, about a 10-percentage-point increase from post-pandemic projections.
These statistics – and more – point towards the requisite for business survival during the pandemic, leveraging the opportunities made available by e-commerce and embracing digital transformation.
Leading e-commerce players have been guiding the digitalization of merchants across the Asia Pacific region. For instance, Singapore-based e-commerce platform ezbuy has helped to shape the e-commerce ecosystem from end-to-end, empowering local merchants by offering them simple and effective solutions to move their businesses from an offline to online model since the changes brought about by the COVID-19 pandemic.
Within just one year, ezbuy has tripled the total number of Singaporean retailers on its platform – ranging from groceries to personal care to electronic appliances, and even alcoholic products. According to ezbuy, this additional way of reaching current and untapped audiences has resulted in more than 50% increase in sales and 20% increase in customer growth for some merchants.
In the post-pandemic environment, the pace of change will force retailers to continually reassess their strategies, which requires more real-time insights on customers and a new agile operating model to harness such insights and put them into action.
DigiconAsia sought out some insights on current and future developments in e-commerce in this interview with Wendy Liu, CEO of ezbuy:
What are the challenges faced by retailers and suppliers when adapting their business from a brick-and-mortar to an online model?
Liu: Digitalization – To remain competitive, retailers and suppliers need to keep up with digitally savvy customers and evolving trends. We have seen an upward trend of placing greater emphasis on the ease of use on e-commerce websites and apps, and quality of customer service. However, digitalization processes are already challenging in pre-pandemic days, let alone undergoing such transformations during the pandemic.
To name a few, re-evaluating the entire business workflows, redefining tasks and roles, learning new tools and applications, as well as potentially changing your business values and culture, are some of the typical challenges faced. Depending on the company size, businesses would face challenges at varying degrees. Smaller businesses, for instance, tend to lack the expertise to lead digitization initiatives, face employee pushback and have no overarching strategy for digitalization.
Delivery capabilities and customer service – A brick-and-mortar business will see customers visiting the physical stores and bringing their purchases home with them after. Whereas an online business requires delivery of purchases to the customers’ homes. This can arise as a challenge for retailers and suppliers if they do not have a delivery system in place. Typically, e-commerce platforms may require merchants to engage third party logistics providers. As ezbuy aims to streamline the processes for the merchants, we will pick up the parcels from them and deliver the products on their behalf.
Additionally, transitioning retailers and suppliers may not have dedicated customer service staff to handle online enquiries or after-sales services. They may be unfamiliar with the standard procedures of online customer service, resulting in their inability to respond efficiently and effectively. At ezbuy, we handle the online customer service on behalf of the merchants, while other platforms will direct consumers to merchants for inquiries, which could potentially pose manpower challenges to merchants.
What would be some key strategies to future-proof such businesses in light of the COVID-19 pandemic?
Liu: Delivery capabilities should be something that every business keeps in mind as well, as it directly affects the level of customer satisfaction and plays a pivotal role in customer retention and business growth. Research has already shown that Singaporean consumers are disgruntled with their digital experience, expecting improvements in delivery costs, product prices and delivery time. Evidently, gaps remain in the costs and quality of service that are critical to close.
As demand for online purchases continues to grow in light of the pandemic, we observe an increasing number of consumers expecting faster local delivery and being drawn towards free delivery promotions. Businesses who are able to pivot quickly to meet the demand for faster and cheaper delivery will have an upper hand in positioning themselves in the minds of the consumers as the most efficient and convenient brands to patronize. For instance, ezbuy leverages in-house logistics to keep costs, quality and speed in-check. To meet the higher demand for home delivery as a result of the pandemic, ezbuy has also increased its in-house driver fleets by 20% to ensure faster delivery.
Businesses without in-house delivery capabilities will need to develop an e-commerce delivery strategy to help keep and nurture loyal customers. Most typically, reputable third-party logistics or courier service providers will be required. One other consideration could be leveraging ecommerce platforms which already have their own logistics division to handle order fulfillment.
To support the increase in parcels volume, retailers and suppliers working with ezbuy have access to over 230 neighborhood collection points in high demand areas while complying with safe distancing measures.
The changes brought by COVID-19 will be here for the long haul. Transitioning businesses can leverage ezbuy’s platform, taking advantage of our user-friendly interface to cater to the digitally savvy users and to better engage customers. As a result, we help retailers pave the way for enhanced user experience and customer relationship as we bridge the gap between retailers and customers.
Competition among businesses has increased as more merchants pivot their operations towards online models. Newfound capabilities such as price, quality, and quantity comparisons make it such that there are more alternatives readily available to the customers. Now more than ever, merchants have to understand their competition. Learning who their competitors are, what they are offering and what their strengths and weaknesses are will help merchants identify the areas that they can and should be competing in. This additional knowledge gives the merchants a platform to differentiate themselves from their competitors.
How can merchants develop omnichannel streams of revenue that enable them to grow their businesses?
Liu: E-commerce sales in Singapore are forecast to hit $13.4 billion by 2026. The survival of transitioning businesses will be largely dependent on their ability to leverage on the opportunities offered by e-commerce platforms, as well as their proficiency in adapting to the inevitable digital transformations. We offer merchants an omnichannel stream of revenue, leveraging on consumer behavioral data analytics to generate revenue more efficiently. Small businesses can leverage on the device compatibility of ezbuy’s platform to keep up with the digital shift from desktops to mobiles.
Mobile phones are now multi-functional and can be used for everything from safe entry registration into physical malls to accessing virtual shopping platforms and comparing prices instantly. Small businesses may not be capable of optimizing their own platforms to meet these demands, especially when the digitalization of merchants was largely met with hesitation pre-pandemic. However, they can acquire such capabilities through ezbuy, which offers them a simple and cost-effective platform to help grow their businesses and expand their reach.
Although Singapore is slowly resuming normal service, many still prefer to shop online after discovering how convenient it is. Already, up to 80% of transactions with ezbuy are made via the mobile app. Through the mobile app, we offer small businesses another outlet to reach out to customers. The multichannel approach provides customers with an integrated and unified shopping experience.
How should merchants leverage digital capabilities to create personalized online shopping experiences?
Liu: Taking ezbuy as an example for better illustration, automated product selection on ezbuy’s platforms highlights the products with the greatest click-through-rate and conversion potential. Platform algorithms provide curated product recommendations based on individual buyer habits. This encourages targeted customers to visit the products and the merchant pages, helping merchants to gain greater exposure and tap into the potential pool of customers that was previously unreachable. With data analytics, merchants could also gain insights on consumer behaviors and evolving trends, helping them to make informed decisions in delivering personalized experiences.
Adapting to an online model means that retailers and suppliers have to position and market their products and offerings in a new way. Unlike in brick and mortar stores, the interactions between buyers and sellers are diminished to a surface level. This can result in the customers not finding what they are looking for.
In addition, ezbuy is using automation to process huge volumes of parcels and orders. This supports smaller local merchants that are unable to handle the influx of orders resulting from COVID-19 restrictions.
In your opinion, how would the e-commerce landscape transform with AI, AR and voice-enabled solutions?
Liu: The e-commerce landscape is shaping up to be increasingly experience-driven. This means that retailers need to focus on keeping consumers engaged and connected. Progressive technologies such as augmented reality (AR) and omnichannel voice solutions allow brands to deliver more immersive end-to-end customer experiences through visual and audio interactions.
Consumers in online shops can only imagine the accuracy of the product depiction, and this can oftentimes serve as a deterrent for retailers keen to get more conversions. AR – enabled by SLAM (Simultaneous Localization and Mapping) allows consumers to virtually try on products before checkout, so consumers can make better decisions and avoid buyer’s remorse. The application of AR in retail goes beyond the online space: Given safety standards in place in spite of the reopening of physical stores, retailers offering virtual product testing are ahead of the pack – with a higher chance of driving conversions.
Beyond AR, AI-enabled voice assistants and customer service kiosks are seen to be a trend driving the future of omnichannel retail: These allow faster navigation through better filtering capabilities, significantly streamlining the order and checkout process. Instead of navigating menus or typing search queries manually, AI-enabled voice assistants offer retailers more convenience and speed – delivering a smoother customer experience.