Last year, the number of offline retail stores that closed their doors quadrupled from about 2000 stores to over 8000. Many have foreseen the ‘amazonisation’ of brick-and-mortar retail in the west, as more and more shoppers prefer online shopping over going the mall. Come to the east, however, and the story is very different. Online sales represent only 4% of the total retail industry in South East Asia.
As I embark on a trip to Southeast Asia to meet the NUCLEUS VISION community, I can’t help but stress the magnitude of the opportunity here. As an IoT solution for brick-and-mortar retail, we believe Southeast Asia will be one of our biggest markets in the coming years.
The “Mall Culture”
For the average American shopper, going to a mall to buy something is considered a chore. Perhaps the fact that malls have existed in the west for a long time makes them less of a novelty. However, in Southeast Asia, mainstream shopping malls have just begun popping up for a little over a decade.
This has resulted in a well-documented behavior among Southeast Asians. In the book Urbanization in Southeast Asia the author explains that going to the mall is a key recreational activity. As more Southeast Asians relocate to urban settings, the allure of the shopping malls and the resulting prominence of offline retail is here to stay.
Uncomfortable with Virtual Shopping
According to a WorldPay survey, over 52% of Southeast Asian shoppers are not comfortable with a virtual shopping interface. There is a strong need to physically see and experience the product before making a purchase decision.
Another e-commerce obstacle is the lack of infrastructure to enable its smooth functioning. Due to the lack of financial instruments to plan logistical infrastructure, most Southeast Asian countries have a long road ahead before they can emulate the west (with the exception of China). Until then, brick-and-mortar retail it is.
IoT, AI and Blockchain — Why Not in Offline Retail?
The potential for cutting-edge technology to disrupt e-commerce is unprecedented. Can one even recall the last truly disruptive innovation in brick-and-mortar retail? For a medium that accounts for over 99% of all retail sales in the region, we believe that brick-and-mortar retail has been sorely neglected when it comes to innovation. We’re about to change that.
AI is one of the cornerstones of e-commerce recommendations and personalization. This data ecosystem already exists on the virtual medium and it is easy to implement in online stores. The brick-and-mortar industry has been looking for its equivalent in the offline world and now we have it.
With IoT, offline stores can now benefit from AI-based recommendations and personalization. We at NUCLEUS have taken this high-tech approach to help retailers deliver more value to their customers on mediums as ubiquitous as SMS.
Blockchain is a real game changer. Even as e-commerce companies come to grips with blockchain, we at NUCLEUS are already putting this disruptive technology to good use. Our proprietary blockchain governs all data exchange in the NUCLEUS network and, in an industry first, brings customer data ownership back to where it truly belongs — in the hands of the customer.
I could go on about NUCLEUS VISION and the future we are eager to realize. But I’ll do you one better — let’s meet and talk about this face to face. I’m at BlockShow Asia in Singapore (29th -30th Nov) , Inside Fintech Conference & Expo in Seoul (30th Nov — 2nd Dec), Hybrid Summit in Hong Kong (3rd Dec — 6th Dec), and in Blockchain Conference in Abu Dhabi (6th Dec-9th Dec) and I look forward to meeting our NUCLEUS community across in the coming days!
Disclaimer: This is not an investment advice. Please do your own research before investing in any avenue. The information contained in this post is for informational purposes only. You should take independent advice from a professional or independently research and verify, any information that you find in this post and wish to rely on, for the purpose of making any decision. Through this post you may be able to link to other websites which are not under the control of Nucleus Vision. We have no control on the nature, content and activity on those sites. The inclusion of any links does not imply a recommendation or endorsement of the other website, its products or views.