PayPal Study Reveals 2011 As Blockbuster Year for Mobile Commerce in Singapore

Singapore mobile shopping market grew more than 660 per cent to S$328m in 2011

SINGAPORE, May 17, 2012 /PRNewswire-Asia/ -- The "PayPal Online and Mobile Shopping Insights 2011" study revealed that 2011 proved to be a landmark year for mobile commerce in Singapore fuelled by a rise in the number of mobile shoppers and a dramatic increase in spend per head. The mobile commerce market in Singapore saw phenomenal growth from S$43 million in 2010 to S$328 million in 2011, representing more than a 660 per cent jump in just one year. The mobile commerce market is also forecasted to grow ten-fold to reach S$3.1 billion in 2015. This shows that mobile commerce is now mainstream and will play an increasingly significant role in the overall commerce market as Internet-enabled mobile devices become a key part of Singaporeans' daily lives.

PayPal Study Shows 2011 was Blockbuster Year for Mobile Commerce in Singapore

Top Mobile Spending Categories in 2011 in S$ millions according to PayPal

The results of the mobile commerce study are staggering and show just how quickly shopping and paying on mobile devices has taken off in Singapore. Mobile shopping comprised about a quarter (23%) of all online shopping in 2011, nearly six times its share (4%) of the online shopping market in 2010. Mobile shoppers constituted close to half (48%) of all online shoppers in 2011, compared to about one in three (29%) in 2010. The median spend per head for mobile shoppers increased from S$93 in 2010 to S$354 in 2011. There were 880,792 Singaporeans who made a purchase through a mobile device in 2011, compared to 364,390 in the previous year.

"As we had predicted, 2011 was a blockbuster year for mobile commerce in Singapore. Retailers are waking up to the fact that they need to offer 'anytime anywhere' mobile shopping experiences for their customers. At PayPal, we are offering safer, faster mobile payments in as little as two clicks to Singaporean consumers that use our digital wallet, while bringing new mobile payment innovation to Singapore such as our QR code shopping at selected MRT stations,” said Elias Ghanem, managing director, PayPal Southeast Asia and India.

In addition to the overall growth of the mobile commerce market, the survey also showed how mobile shopping behavior is changing, from the differences between smartphone and tablet shopping to new forms of mobile shopping such as scanning QR codes.

Smartphones leading mobile commerce but tablet owners spending more

The study revealed that the majority (75%) of purchases made using mobile devices were via smartphones. Singaporeans spent S$244 million through their smartphones in 2011 - representing close to three-quarters of the total mobile commerce market - compared to S$82 million through tablets. However, the average spend per head on tablets was S$380, significantly higher than the average spend per head on smartphones, which amounted to S$274 suggesting a growing market and potential for mobile shopping via web-enabled tablets.

With an eye on future mobile shopping trends, the survey asked consumers what they would like to purchase via their smartphones. Almost a quarter of mobile shoppers indicated a desire to purchase fashion items, airline and movie tickets on-the-go with their smartphones indicating there is room for growth and that retailers have the opportunity to provide multi-channel shopping experiences in these categories.

Those who shopped on their tablets exhibited a different set of preferences. Tablet users indicated they would like to purchase automotive goods and computer hardware. This suggests that compared to smartphone users, tablet owners are more likely to purchase higher ticket items on their devices due to the tablet's larger screen size.

The survey findings revealed a clear trend in couch commerce with four out of every ten purchases on both tablets and smartphones made at home. The office was the next common place to shop (18% of smartphone users and 11% of tablet users). Mobile shopping while commuting via bus or train or in transit was yet another preferred place for transactions (13% of smartphone users and 11% of tablet users).

The top spending categories for mobile shopping are listed in the graph below. Mobile shopping is much broader than just digital downloads with "fashion and accessories" and "movie tickets" seen as hot favorites for both smartphone and tablet shoppers.

QR codes enable 24 by 7 mobile shopping and blur the lines between online and offline commerce

Smartphones are increasingly bridging the gap between the online and offline retail worlds. The study revealed that Quick Response (QR) codes are gaining popularity among Singapore smartphone shoppers. Four out of every ten smartphone users were aware of QR codes, and of those who were aware, 45 per cent had used QR codes for an average of eight transactions in 2011.

The most common items purchased through QR codes were books, fashion items and computer hardware. Curiosity (33%) combined with ease-of-use (21%) were cited as the main drivers of QR code usage. QR codes provide retailers the benefit of launching virtual pop-up stores across all channels and media and enable 24 by 7 mobile shopping to complement brick-and-mortar store locations.

PayPal's QR code campaign with SMRT from February till April this year enabled an average of 500 transactions per 10,000 scans by Singaporean commuters, equivalent to a 5 per cent customer conversion rate, which is higher than the average direct email response rate of 1.7 per cent (Note 2). Showbiz Asia saw huge mobile sales success by offering one-for-one tickets for award winning show WICKED to Singaporean commuters via this QR code campaign, resulting in close to five times increase in mobile ticket sales through PayPal as compared to sales for the same period pre-campaign.

Security concerns and lack of user-friendliness present mobile shopping barriers for consumers

While Singaporean consumers are increasing their mobile commerce spend exponentially, security concerns and the lack of user-friendliness were indicated as the main barriers towards greater adoption. The research highlighted that 40 per cent of all mobile shoppers felt that mobile transactions were not safe enough. Other barriers to further adoption of smartphones for mobile shopping included "screen size is too small” and "Internet speed is slow.”

Research Methodology

Commissioned by PayPal, The Nielsen Company conducted the online research study "PayPal Online and Mobile Shopping Insights 2011" to develop a greater understanding of the mobile commerce market and the habits of Singaporean mobile shoppers in 2011. The research (Note 3), which was conducted online, surveyed a representative sample of 1009 Singaporean online shoppers aged 18 and above, of which mobile shoppers (Note 1) constituted 482 respondents.

Note:

1. Mobile shoppers are defined as those who shopped or made online purchases using smart phones and/or web-enabled tablets for this study.
2. According to Response Rate Trend Report 2010 by Direct Marketing Association (DMA). It refers to a 1.73 per cent customer conversion rates for emails to a house list.
3. Unless stated otherwise, all data provided in this press release is from the "PayPal Online and Mobile Shopping Insights 2011" study.

About PayPal

PayPal is the faster, safer way to pay and get paid online. The service allows members to send payments without sharing financial information, with the flexibility to pay using their account balances, bank accounts (where available), debit cards and credit cards in various markets. PayPal is an eBay company and enables global e-commerce with more than 110 million active accounts in 190 markets and 25 currencies around the world. More information about the company can be found at https://www.paypal.com.sg.

PayPal is headquartered in San Jose, California and its international headquarters is located in Singapore.

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