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How E-commerce Giants Like Shopee, Lazada, Zalora Entice You To Shop And Spend More?

One of the reasons why e-commerce is big business is because they know how to get their customers to spend more.


In Singapore, the revenue of the e-commerce market is expected to reach close to US$2,800 million in 2021. While many industries are struggling to stay afloat amidst the pandemic, e-commerce is booming with an annual growth rate of 9.9%. In 2020, e-commerce platforms even saw an exponential increase in web traffics by 23%. Even though many of us may tighten our overall spending, it’s possible that we may still end up spending more online.

What Contributes to the Rise of Ecommerce?

It seems ironic that the pandemic has “encouraged” us to shop more, but it is understandable. Having to stay home for a prolonged period has driven us to keep ourselves entertained, and that includes shopping online. Pretty much like how retail therapy works, though in this case, it’s digital retail therapy.

Once we start to access an e-commerce site, it’s no easy feat to stop browsing item after item. And the next thing we know, we probably bought something. In fact, many of us may even spend more time on an e-commerce site than other activities.

Of course, e-commerce has been growing steadily in many parts of the world even before the pandemic. The most logical explanation for this is digitalisation and our smartphones. As we become increasingly inseparable from the Internet and social media, we are naturally more accustomed to the digital way of life including communicating, working and shopping. Ecommerce platforms can penetrate into our daily lives easily through digital and social media marketing, influencing our shopping decisions anytime anywhere. Not only do they provide a seamless shopping experience with unmatchable convenience, they can also target us with frequent promotions and creative tactics.

Some e-commerce giants can even throw in big bucks to infiltrate our screens aggressively with their marketing campaigns, with Shopee advertisements featuring local celebrity Gurmit Singh (playing the iconic Phua Chu Kang) and that of Lazada featuring Korean oppa Lee Min Ho.

Read Also: Why Is Decathlon Able To Sell Its Products At A Cheaper Cost Compared To Its Competitors In Singapore?

Tactics Used by Ecommerce Giants to Influence Your Shopping Habits

Whether you are looking to find ways to curb your shopping habit, or just curious to know how e-commerce giants like Shopee, Lazada and Zalora influences their customers to spend more than they need to, there is no harm in knowing the kind of strategies being employed by these e-commerce giants.

Creating Special Dates As An Excuse To Spend More

What else is more important than price, when it comes to shopping? Ecommerce giants are adept at capturing the right moments to launch attractive promotions. After Alibaba had clocked record-breaking sales from their annual 11.11 campaigns ($115 billion in 2020), other e-commerce giants caught up with the game and started rolling out similar campaigns. They replicated the success of 11.11 campaigns to other special dates including 1.1, 2.2, 12.12 etc., seizing every opportunity to entice consumers to spend more throughout the year.

Flash Sale To Drive The Fear Of Missing Out (FOMO)

Besides the frequent sales promotion, e-commerce platforms also run periodical flash sale, a time-limited discount that typically runs for a few hours to up to 24 hours, that urges consumers to shop and spend immediately. It doesn’t help to have friends sharing upcoming flash sales on their social media platforms, causing us to have the fear of missing out on discounted items. The e-commerce platforms play their carts well by tapping on this subconscious fomo (fear of missing out) behaviour that is common among younger consumers.

Group Buy To Enjoy Lower Prices

Unity is power, and this concept can also be applied to the context of online shopping. With Shopee, we can initiate Group Buy by inviting friends and families to join a group we have created and buy products collectively to secure lower prices. This is somewhat similar to the concept of bulk purchase, except that we can gather people to purchase a specific item together instead of buying it in large quantities alone. There are, however, some conditions attached to group buy. Members are required to pay for the selected item within 24 hours after being added to the group, and there is a maximum quantity allowed, urging consumers to pay quickly and not think too much.

Buy Now, Pay Later (BNPL) To Increase Spend

It’s not only with credit cards that consumers can buy now, pay later. Zalora has tied up with the BNPL platform Atome to introduce flexible payment options. By selecting Atome as the payment option upon checkout, consumers can split their purchases into three zero-interest payment cycles. The flexibility of splitting payments may indirectly influence consumers to shop and spend more without having to worry about next month’s bills.

Games to Engage Customers

For online shopping, driving purchase is important but maintaining strong consumer engagement is equally crucial. In this case, some e-commerce giants like Shopee and Lazada have made use of gamification to reward consumers with shopping credits and e-vouchers. Not only do such tactics encourage consumers to visit their platforms more frequently, but they also ended up shopping more often and spending more with the incentives they won. Shopee and Lazada are also ahead of the rest when it comes to live streaming by partnering with different influencers and celebrities to host virtual events, festivals and auctions on the e-commerce mobile app.

Cart Reminders and Personalised Coupons

Cart abandonment accounts for the largest drop-off across all e-commerce platforms. Consumers have the tendency to shop out of impulse but delay completing their purchase after checking out, and eventually forget about it.

To counteract this phenomenon, Zalora is one of the first e-commerce platforms to pushcart reminders with personalized coupons to drive consumers in making that final step of the purchase. Sometimes what we need is probably no more than a nudge to remind us that our favourite item is still left in the cart. Even better, a personalised message that comes with an added discount will not only make us feel special but push us to complete the transaction.

Cashback Points and Credits to Encourage Guilt-free Shopping

The rise in popularity among cashback credit cards, loyalty programs (KrisFlyer) and cashback platforms (Shhopback) have proved the effectiveness of cashback. For every dollar we spend, we accumulate points or credits that could offset our future purchases. This idea of saving more while spending also takes away (some of) the guilt from consumers and attunes online shopping as a lifestyle activity, like how we buy groceries and earn rebate points regularly. Ecommerce platforms are not only getting consumers to shop more during special occasions but anytime in the day.

Customer-Friendly Features to Improve Experience

Besides monetary incentives, having customer-friendly features play a part in encouraging us to shop and spend more. With consumers today becoming more digital-savvy, we expect a seamless shopping experience and this is what e-commerce platforms have done well. We can easily view product reviews, bookmark our favourite items, save items in cart and save credit card details for easy checkout. We can also request a refund if the items delivered are not satisfactory, giving us a peace of mind with online shopping. While these are not features that directly drive our purchase, we are likely to shop more because of how convenient it is.

Ecommerce – The New Normal

10 years ago, some of us may not have expected e-commerce to become a part of the new normal, and even replace brick-and-mortar shops. The rise of e-commerce has once again reminded us that digital is here to stay, and consumers expect better prices, more convenience, greater flexibility and higher engagement throughout their journey.

Read Also: 7 Useful Apps And Services Every Savvy Singaporean Should Already Be Using To Save Money

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