People were surprised when Amazon launched its two-hour delivery service, Prime Now, in Singapore last month. Unlike other countries where it launched Prime Now, the e-commerce giant didn’t have a retail presence here to begin.
So going from no Amazon at all to the ultra high pressure two-hour Prime Now delivery service certainly raised eyebrows.
Customers responded by calling for an avalanche of orders on launch day, July 27. Singaporeans were so enthusiastic, Amazon’s first day here closed three times the order volume in this tiny island, than it did when it launched in its home city of Seattle in 2015.
And as the orders piled up, the app started showing delivery was “unavailable” within the day as Amazon ran out of physical delivery folks to fulfill orders.
But because it was relying on multiple third party logistics services, instead of running delivery itself, it could ramp up capacity over the next day by requesting for more help.
The company was so serious about making good on its two-hour promise, it sent off some of its warehouse officers in Ubers and cabs to make deliveries, too, confirmed Henry Low, director of Amazon Prime Now for Asia-Pacific.
With that, Amazon pulled off its biggest Prime Now launch in its history.
Amazon closed three times the order volume in this tiny island than it did when it launched in its home city of Seattle in 2015.
Singapore packs its 5.5 million people into a metropolis of just 710 square kilometers (274 square miles), with most of its residents living in high-rise apartment buildings. Amazon serves the country out of a single warehouse — its largest Prime Now facility yet, at 100,000 square feet.
Seventy-nine of the 80 postal districts that cover Singapore have made orders in the month since Prime Now launched.
How Amazon did it: data, data, data
Amazon had already offered two-day or next-day delivery in the U.S., UK, and Japan, which has allowed it to iron out its processes in the lead up to offering Prime Now.
In Singapore though, it had to come out with a bang and go straight into two- and one-hour delivery, without the luxury of testing it out in real life.
To get it right, the secret was Singapore’s fairly unique postal code system, Low said. Each six-digit number corresponds to an individual building — and not a broader district, as it does in other countries.
This gave the company sufficient granularity to run in-depth simulations on delivery routes right to a customer’s doorstep. It could also develop more sophisticated models, with data it had on what customer sets would likely order from Prime Now, and when.
In addition, Amazon has years of historical data on Singaporean buying patterns on Amazon (the slow, non-Prime Now way). All of this helped its predictive systems see into the future, providing a picture of how the real day would likely play out, Low explained.
And what are Singaporeans buying? The top five items in its first month of operation are toilet paper, green tea, fresh milk, hot and spicy potato chips, and — curiously — broccoli.
Apart from groceries, Amazon has also delivered a toy flamingo set, and a car transmission cooler here.
Low said Amazon is keen to be in Singapore, despite its small size, because the country’s tech-obsessed citizens are super connected and “love shopping.”
Plus, Amazon hopes to plug into the talent pool here, he added. “The business environment allows us to experiment with various innovations like new payment services, that we haven’t before.”
All well and good, but our only question is, who’s ordering all that broccoli?