Online shopping is killing department stores in Singapore
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Even grocery items are being bought online now.The rise of e-commerce is sounding a death knell for Singapore’s once-ubiquitous department stores and gadget shops, according to a report by property consultancy group JLL.
The number of shoppers buying groceries and computer equipment rose around 70% in the last two years, while over 60% of shoppers already buy some clothing or footwear online. The report said that shoppers are buying lower value goods online and higher value goods over $500 in a physical store.
“We expect online sales of groceries and electronic goods to grow exponentially in the next three years,” JLL said.
As a result, department stores, supermarkets and houseware shops have reduced in size over the past few years, particularly in suburban malls. In contrast, food and beverage, fashion, beauty and health trades have taken up more space in the last seven years.
“As shoppers tend to buy lower value goods online, malls are likely to attract higher-priced fashion and beauty brands, even in the suburbs. We expect to see electronics and grocery stores cutting back further in the next three years as more shoppers buy these goods online,” JLL said.
Latest data from the InfoComm Development Authority (IDA) showed that about 1.44 million Singapore residents shopped online in 2014, 30% higher than in 2012.
The sharp increase came from shoppers above 35 years old, as those in this group that used portable devices to access the internet rose 50% over two years. Over 70 per cent of those below 35 years old already shop online in 2012.
Questions & Answers
Q.What kind of goods are shoppers buying online compared to in physical stores?
What kind of goods are shoppers buying online compared to in physical stores?
Shoppers are buying lower value goods online. Conversely, higher value goods over $500 are typically purchased in a physical store, according to the report by JLL.
Q.Which retail sectors have expanded their physical presence in Singaporean malls recently?
Which retail sectors have expanded their physical presence in Singaporean malls recently?
In recent years, food and beverage, fashion, beauty, and health trades have taken up more physical space in malls. This contrasts with the reduction in size seen in department and houseware shops.
Q.Which age group contributed most to the recent increase in online shopping in Singapore?
Which age group contributed most to the recent increase in online shopping in Singapore?
The sharp increase in online shoppers in Singapore between 2012 and 2014 primarily came from those above 35 years old. The number in this group using portable devices to access the internet rose significantly.
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