The signs are alarming for brick-and-mortar stores. Recent trends have shown shoppers here are increasingly taking care of their shopping needs online, drawn to the increasing convenience (especially during the dreaded festive seasons).
Retailers such as Qoo10 and Lazada are a hit because of their wide variety of goods at relatively low cost and reliable delivery services. In fact, a recent survey by Blackbox Research of 800 Singaporeans and permanent residents aged 15 years and above revealed that the majority prefer shopping online.
As far as this year’s Christmas shopping is concerned, 56 per cent of them said they preferred to do their shopping with online retailers versus the 44 per cent who opted for shopping at physical stores.
Nevertheless, Retail News spoke to remain upbeat and confident about the value of physical stores, stressing that they have a place in the market, providing a human touch and at atmosphere that websites cannot rival.
Katie Page, chief executive officer of Harvey Norman, agrees and scoffs at the idea of online stores eventually surpassing physical ones. “You can get information about the product online and the price, but that’s it,” she said, adding how physical contact with the product is crucial, especially with women shoppers. “Women like to see that physical aspect, they will go to the shops to see the product.”
Page also stressed the importance of delivering a great shopping experience, pointing out how some retailers forget that. She added: “You need to invest in the brand, and for that, you need space. Some online stores are now opening brick-and-mortar outlets, right?”
Agreeing, Christophe Cann, group chief executive officer of Robinsons Group (Asia), said although the company has plans to have an e-commerce function in the future, online shopping is “just another avenue for customers to make their purchase”.
“We are not worried about the trend as we believe that brick-and-mortar business will remain relevant to customers,” he affirmed.
“As long as Robinsons continues to entertain our customers and provide an enjoyable shopping experience … I believe we are here to stay.”
This, he added, is achieved through initiatives such as designer trunk shows, exclusive beauty launches and meet-the-designer events that complement ongoing efforts to constantly bring in new brands and products.
All about atmosphere and service
Retailers are confident that nothing beats being at a physical store, as good experiences will ensure customers return.
“We cultivate a friendly ambiance and treat our customers as friends,” said a spokesperson for skincare and cosmetics store Stenders, which prides itself on handcrafted body scrubs and soaps made with natural ingredients. “Most of our customers love coming back to test, try, and smell and feel the product, and interact with our store associates,” he continued.
(To boot, customers will also receive a kaleidoscope, as part of its A Kaledoscopic Christmas campaign.)
The obvious physical connection cannot be overemphasised, as much of the joy of retail, said Darellyn Lau, managing director of candy and gift store Sophisca Singapore, is in touching and feeling the merchandise.
“The desire for instant gratification is still key with some buyers, who appreciate the ability to touch, feel and buy an item all in the same moment, which is only possible at a physical store.”
Still, aware that online shopping is time-saving for people with busy schedules, she added that the company is offering free delivery services for purchases above S$250 (RM 760).
Robinsons, too, said it has had to rethink its strategies to improve its services and in-store experiences.
“It has motivated us, as brick-and-mortar retailers, to sit up and listen, to observe, learn and adapt … This new platform sheds light on what consumers are looking for, as well as the services they desire,” said Cann.
Consequently, the company has made arrangements for delivery services with every S$200 nett spend and complimentary personal shopper services at its flagship store at The Heeren.
“In this day and age … customers need a good reason to visit you,” he added.
“Retail is not just about transactions but experiences. Hence, we constantly remind our staff from all departments about the company’s vision and mission to ensure that as an organisation, we always put the customer at the centre of everything we do.”
Online complements, not threatens
Some retailers say their online stores serve more as a complementary service to give consumers more options.
Dominic Wong, chief operating officer of beauty-care chain Watsons, said while its new eStore (launched this year) is a quick and convenient option for busy customers, its physical stores “serve as a good platform for customers to discover and try new products, especially for make-up and beauty items”.
Its in-house pharmacies also provide another touch point for customers who need health consultation and recommendations on supplements.
This Christmas, it is also offering a free gift-wrapping service for purchases made.
While the online store’s performance is “growing strongly”, the company “see(s) physical stores flourishing alongside online channels”, he continued, adding that it will continue to be on the lookout for new ways to improve and engage customers better.
Its recently revamped Ngee Ann City and Bugis outlets, for instance, cater better to the demographics and buying patterns of customers in the area, and give clearer demarcation of the different product categories, said Wong.
A Uniqlo spokesman, too, said the fast-fashion brand’s online store is an extension of its physical store, giving customers the option of shopping from home and on-the-go.
However, its staff has been specially trained to provide assistance and recommendations by catering to the needs and queries its customers may have in store, she added.
“We believe this personal touch is key to create an enhanced shopping experience and will keep customers coming back despite the convenience of online shopping.”
Clearly, though, the advantages of both platforms remain complementary. “Shoppers are still basing their decision by checking online for reviews and information before stepping into the stores and vice versa. The relationship between off-line and online is, in fact, a symbiotic one … ,” said Publicist PR’s director, Cecilia Tan.
Pointing out that physical retailers should focus efforts on creating a stronger in-store experience, Tan added: “As a PR and brand consultancy, we recommend that clients focus on their core group of customers … It is important to keep them close through customer perks and in-store activities.”
She stressed that “retailers need to integrate their communication campaigns through both traditional PR and digital PR; that is the best way to ensure customers will want to visit a physical store, validate their choices, and ultimately (make a) purchase after researching about their brand online”.
For other stores, online sales serve as a platform to reach out to more people. Men’s Grooming Store WhatHeWants has seen online sales more than double compared with three years ago. Online sales currently make up 30 per cent of its total sales.
Its founder Tan Seng Hwee said he is excited about the online trend.
“The online space is not limited to the space it occupies, unlike a physical store. Besides Singapore, my sales revenue comes from Malaysia, Australia and Indonesia,” he noted.
“The trend of buying online is definitely making big waves with the increasingly tech-savvy crowd, and the widespread use of tablets and mobile phones. Coupled with lower prices and deliveries right to one’s doorstep, buying online definitely has many plus points,” he added.
Pointing out that physical shops need to maintain a higher margin in order to cover rental and staff costs, he said prices in physical shops “can never be cheaper than online stores”.
“In the past, retail businesses expanded by opening more physical shops.
“However, in Singapore, the high rentals and labour crunch limits scalability. For a company to grow further, moving online is the only way to go,” he explained.
“While retail stores are still important, the retail industry in Singapore has to learn how to adapt to the new online world.”
