There had been a lot of buzz about giant global online retailer Amazon coming and operating in Singapore, with great hype since the tech giant broke official news of entering the SEA market. Amazon’s intent was largely verified with massive employment ads employing for a Singapore-based regional headquarters over a year ago. Following a line of delays from the initially targeted Q1 2017 launch date, Amazon launched their Prime Now service today with a bang.
Amazon in Singapore, a first
Amazon long had a strong presence in the US, Europe and Japan. Singapore is Amazon’s first market in South East Asia. The presence of more tech savvy users in Singapore makes the tiny island city state a prime candidate for online-retail. Moreover, this is complemented with more mature internet infrastructure and accessibility compared to neighboring countries. There is possibility to have this little red dot service the region in possible future e-commerce expansions.
Amazon’s entry to the Singapore market signals a determination not to let the market share taken by incumbent with Alibaba/Lazada and RedMart. These players had been operating here for years. The new giant US online retailer aims to leverage on their tried-and-tested expertise in delivering possibly one of the best online shopping experiences globally right here in Singapore shores.
Obtaining the Prime Now app
This will definitely get long-time Amazon users like myself plenty to be excited about. Considering that Amazon had long catered for the Singaporean market. They had been offering free international deliveries from USA but with a hefty $125 USD minimum order quantity. Now, downloading the new app from the Play store and iTunes will get you up and started in a gif onto the bandwagon. Just be sure to download the right app (called Amazon Prime Now) made by Amazon Mobile LLC, given tons of official apps the one.
You have to setup your delivery location via postal code at startup. The app interface is clean and simple to use with a welcome page summarizing the daily deals. Intuitively, you can scroll through various sections via a vertical menu with the product listings behind each section block.
Pretty much an online Hypermart
As part of the initial “Prime Now” launch, you have a choice of 36 item categories ranging from household essentials, food products, perishable/frozen goods to consumer electronics. Amazon “Prime” is a bolt-on annual subscription service, offering shoppers more access to regular insider members-only deals.
For the initial launch, all Amazon users with a registered “Non-prime” account can have access to the Singapore “Prime” Now service until the membership service is formally launched here. This is part of future expansion plans to tie in more Prime service together with the already launched Amazon video streaming service. The app is intuitive to use with a persistent swipe out quick jump menu.
Ahoy Amazon Basics had landed!
Noticeably, Local NTUC and Cold Storage supermarkets had tried to enter the market of online grocery shopping. However, there was limited success given the lack of comparative advantage in offering a holistic online shopping experience. This is what we can see Amazon plans to capitalize on. Food products are not the only markets Amazon is targeting. In addition, you also get a full suite of baby products, toys, and electronics.
Notably you have access to almost Amazon’s entire range of Amazon Basics items covering electronics, household items, stationary, pets and sport items too. Amazon Basics items are simple, no-frills plain everyday house brand products which you can buy if branding (and blandness) is not a problem.
Interesting unique localization of the app shall be the “local favourite” food picks. This includes several Singapore-branded item such as Ayam Brand canned food, Prima Taste food pastes and even Asia pacific brewery range of products including Tiger Beer. Don’t be expecting competing house brands such as Homeproud here. Prices are comparable to brick and mortar prices in Singapore too. For instance, a 1.5L bottle of Polka green tea costs $1.60, while a pack of Maggi noodle costs $2.20.
Prices consistent with US Amazon
Amazon US is one of the best places to get low-priced major-brand electronics, and I am glad to find that you can find TV screens, computers, audio products (just to name a few) on the Singapore Prime Now app. The Singapore app product prices are similar to those offered on their US website. For example, a 256GB Western digital Solid state drive costs $135 SGD, on-app, where the same model costs about $90 USD (~$128 SGD) listed on Amazon.com, so additional mark ups are minimal here. The similar PC product cost $145 – 199 SGD from retail stores such as Sim Lim Square, Challenger and Harley Norman. We can potentially see these stores having their business profits severely disrupted.
Furthermore, electronics may probably not be the only market affected. Toys such as Lego are also sold direct in through Amazon in Singapore now, seemingly eliminating the middlemen monopoly of retailers in Singapore (such as Brickworld). However, all typical Prime Services such as the Kindle range of products are still not available for purchase through the Singapore Prime scheme.
To sweeten the deal, Amazon Singapore is offering $20 coupon codes for your first purchase using VISA (code: VISA20), to get you to link your credit card where subsequent orders can be made with one-click. Using the 10PRIMENOW code gets you $10 off your first order. The $40 SGD minimum purchase applies to both offers.
Free 2 hour delivery? woot!
Amazon offers free same-day 2 hour (near-instant) Singapore address delivery with a minimum spend of $40 SGD in a single order. The order has to be made between 10am to 10pm. Having a product arriving in 2 hours might even be faster than even leaving the house and buying the product in person. $5.99 SGD is chargeable for orders below $40 SGD or if you need your items in a rush. Also, topping up $9.99 gets your items within the hour regardless of order value.
Amazon claims “tens of thousands of items” available to the entire population of Singapore on demand. No word on any limited delivery location areas though, so don’t be too hopeful to have your groceries delivered to your address in Jurong Island or Pulau Ubin too soon.
Deliveries from Jurong
The American online shopping behemoth now operates out of its 100,000 square feet warehouse in Jurong East just off Toh Guan Road East. The facility touts housing over 20,000 items readily available “under one roof”. Contrary to the automated robotic warehouses in America and even those used by Alibaba in China, the Singapore fulfillment center still utilizes manual human operators to gather items from shelves, aided by Amazon’s warehousing algorithms. Items are packed in Amazon brown bags and delivered to your door by a range of local delivery companies. These range from independent private hire cars to local logistics companies such as Ninja Van (who also delivers for competitors such as Lazada too).
Despite Amazon known to use national postal services (e.g. Royal mail and USPS in UK and US respectively) to deliver their items, Amazon Singapore is largely leveraging on private logistics companies instead of SingPost to fulfill their supply chain deliveries. This is given greater control of the Quality of Service and reliability, especially that required by the 2 hour delivery guarantee. This near-instant delivery betters those provided by forefront leader Lazada (who sells mainly electronics) and Honestbee/Redmart in groceries.
Friendly Return Policy
Like most western retail stores, Amazon maintains a quality of service guarantee for their delivery. Amazon stated that customers can reject the order in the event of missing items to build consumer trust. All products come with a 14 day return policy with exclusions on certain specific products, such as customized products. Singaporeans are notorious in exploiting return policies. I do hope that the local population here won’t capitalize on Amazon return policies, given what we had seen historically with the widespread exploitation of the Singapore lemon law.
In all, the entry of Amazon into the already crowded and competitive Singapore online shopping scene is a great welcome. Also, perceptions here are changing and more tech-aware Singaporeans are widely adopting online shopping as part of their purchase staples. Hence, making this market a very viable area of growth. With eventual lowered prices and better quality of service from competition, especially with the removal of middleman monopolies, consumers here have much to gain at the end of the day.