S'pore m-commerce to grow 10-fold to $2.4B by 2015

S'pore m-commerce to grow 10-fold to $2.4B by 2015

Summary: Mobile commerce grew over six times to hit S$328 million (US$259 million) last year in country; merchants should prioritize resources on building mobile optimized sites--ahead of apps--to best position for growth, PayPal execs note.

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SINGAPORE--The island state is one of the strongest mobile commerce growth markets in Asia, and set to grow ten-fold to S$3.1 billion (US$2.4B) in three years' time, according to PayPal executives. They add that to capture the fast growth here and in Asia, merchants should first focus on creating mobile optimized sites.

According to Rahul Shinghal, director of mobile at PayPal Asia-Pacific, mobile optimized sites should be the basic strategy for online merchants to reach out to their customers, before deciding to build mobile applications. He was speaking at on the sidelines of a press briefing here on Thursday.

He explained to ZDNet Asia, in an interview, that building a shopping mobile app will require "strong marketing muscle" from the merchant, which can cost a lot. As such, only big brands that have enough marketing budget should make a good mobile app for consumers to shop, he said.

Smaller merchants, on the other hand, may have budget constraints, and should focus first on making a good mobile optimized site, Shinghal noted.

Regardless, mobile optimized sites should be the first priority for merchants of all sizes, he pointed out, adding that it was a "must-have" in the age of mobility.

"Mobile optimized sites are the basic, and you should only move on to the app if [your company] has enough money," he said. "Otherwise, they risk losing a huge chunk of customers."

Retail consumers have changed, and they want to shop anytime and anywhere, so it is important to give them a good mobile shopping experience, Shinghal surmised.

Rise of mobile commerce in Asia
Regardless of whether it is creating good mobile optimized sites or apps, such steps are pertinent for Asia-Pacific merchants, especially with the region being at the "forefront" of mobile ecommerce, Shinghal pointed out.

This is due to the high smartphone and tablet penetration rate leading to more people owning mobile devices and strong 3G infrastructure in the developed markets of the region, he explained. In emerging markets such as India, many have also skipped the personal computer (PC) stage to use the Internet on mobile devices, he added.

Asia also has a large "young" population, with most of them being "e-savvy" and enjoying the use of technology devices, added Elias Ghanem, managing director of PayPal Southeast Asia and India. "[The region] has the right recipe for making people spend more online through mobile devices," he said.

Boom in Singapore mobile commerce
Singapore, for one, has one of the strongest mobile commerce growth markets in Asia--being the region's digital hub and a wired nation, Ghanem noted.

He referred to a study PayPal Online and Mobile Shopping Insights 2011, released Thursday, which found that there had been a "dramatic increase" in mobile commerce in 2011 as compared to the year before.

It was found that Singapore's mobile commerce market grew by 660 percent, from S$43 million (US$34 million) in 2010 to S$328 million (US$259.4 million) in 2011.

The most amount of money was spent on fashion and accessories at around S$63 million (US$49.8 million) in total, followed by movie tickets at S$48 million (US$37.9 million), books at S$37 million (US$29.3 million). The next two most popular categories were apps, and food and groceries.

Most of the shopping was done from home, with 4 in 10 people doing so. The next most common place was the office, followed by mobile shopping while commuting.

Mobile commerce had also comprised of 23 percent of online shopping in 2011, nearly six times its share of the online shopping market in 2010, at 4 percent.

The number of mobile shoppers also rose. They had constituted close to half, at 48 percent of all online shoppers in 2011, compared to 29 percent in 2010. 880,792 Singaporeans had made a purchase through a mobile device in 2011, an increase of 141.7 percent from 364,390 the year before.

The survey was conducted over the Internet with a representative sample of 1009 Singaporean online shoppers aged 18 years old and above, of which mobile shoppers constituted 482 respondents.

Topics: Hardware, Apps, CXO, E-Commerce, Mobility, Security, Software, Tablets

Ellyne Phneah

About Ellyne Phneah

Elly grew up on the adrenaline of crime fiction and it spurred her interest in cybercrime, privacy and the terror on the dark side of IT. At ZDNet Asia, she has made it her mission to warn readers of upcoming security threats, while also covering other tech issues.

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