How bricks met clicks and lived happily ever after in Singapore

Singaporeans love to shop! And with every purchase we make, whether online or in a store, we go through a decision-making process that revolves around Price, Favourite, and Availability (PFA).

Depending upon what the purchase is, this process may be conscious or unconscious, with P, F, or A being the driver depending on the time pressure of the purchase.

Regardless of the product you want to buy in Singapore, your favourite brand will often be adjusted around Availability and Price. If there is no urgency to the purchase, Price becomes a key driver and Favourite (brand) will also be achieved.

But if you are desperate for a product, then your opportunity to find a cheaper price is limited in Singapore, meaning you may also compromise on your preferred brand.

A simple example of PFA in action is the purchase of petrol. If your tank is half full, you are more likely to drive along Bukit Timah Road comparing the prices at various petrol stations until you find one that fits your price expectations and gives you the most rewards on your credit card (Favourite).

But if you are running on empty, Price and Favourite move to the bottom and Availability becomes key.

This idea of PFA is not new; we have been conditioned to this idea for some time across various industries. One of the more obvious examples is the airline industry. Think of the last time you purchased a Singapore Airlines plane ticket three months out.

By purchasing in advance you allow SQ to plan everything from catering to fuel usage, plus the ever-important cash flow provisions. But if you make the purchase 24 hours in advance, you are more likely to take any seat you can, on any airline, and pay a premium price.

PFA is becoming more easily managed with the evolution of Internet of Everything (IoE), which enables customers to build their own profiles online.

By sharing and being able to access the data we generate every day, IoE systems are able to understand our wants, needs, and frequency of purchase. This data can be connected to effectively allow customers to plan and buy efficiently without making a conscious choice to do so.

Let’s take wine as an example. Everyone has a favourite – red or white; chardonnay or pinot noir; 2007 or 2010; Australian or French - the list is endless.

If you want your favourite wine from your favourite vineyard from your favourite year, and you decide you want it today, there is a strong chance it will not be available. And if it is available, you will probably pay a premium to cover the cost of storage, distribution, sales staff, and sales margin, whether buying from Cold Storage or a specialist wine store.

However if you planned weeks, months, or even a year in advance, and are prepared to forward purchase or even deal directly with the vineyard, then your options increase. This is especially true in Singapore where everything is imported.

Now take that same forward planning concept and allow IoE to capture your qualitative and quantitative data on that brand and share that information with the brand owner, and suddenly PFA is working for you without conscious planning.

Availability increases as wine producers can plan for your order. This planning not only allows management of product cycles, it also removes the middle-men.

The reward for the consumer is access to a product they love at a better price than if they purchased it through a retail store. Plus, they are building a relationship with brands/products they feel passionate about.

PFA using IoE not only rewards customers, it is also rewards brand owners who are able to identify you as a loyal customer and offer goods at a price that reflects efficiencies created within the supply chain, waste reduction and ensures that product location is aligned with demand.

This all goes towards sharpening the pencil on price and rewarding the loyal shoppers of Singapore.

This will ultimately lead to bricks and clicks finding harmony as shoppers interact with brands and increasingly use mobile devices to make their purchases. IoE will connect inventory data relevant to your PFA, allowing brands to ensure you can find their product at a price that reflects fair value, relevant to your needs.