Local and regional e-tailers have been wondering the same thing. Taking the U.S. giant's eventual arrival as a given, they have been racing to fortify their own positions, none more so than Alibaba Group Holding. The Chinese internet behemoth has been stepping up its offensive since 2016, when it became clear that Amazon was on its way.

Tiptoeing in

Amazon finally landed in Southeast Asia on July 27. For many market players and analysts, this signals the start of a long and fierce battle between the Eastern and Western champions of e-commerce. But the arrival is likely to have repercussions far beyond Amazon and Alibaba, changing the fundamental dynamics of competition for players in every market in the region.

Amazon has begun its foray by dipping its toe in the small but dense urban market of Singapore, bringing its Prime Now service, which is tailor-made for urban residential areas.

According to the company, the service offers two-hour delivery on tens of thousands of items, including groceries, daily-use goods such as shampoo and diapers, and home electronics. Prime Now is offered only through a dedicated app, however. The company stopped short of opening a full-service website for Singapore, a move that has drawn some complaints on social media.

Limited though this first sally may be, Amazon has faithfully replicated its signature asset-heavy "click-and-mortar" business model in Singapore, setting up its own massive warehouse, or "fulfillment center," as the company calls such facilities.

"We use advanced techniques and algorithms to fulfill orders as quickly and efficiently as possible with processes such as random stow, batching and machine learning," said Ivan Lim, Amazon's Singapore logistics site leader, at a launch event held inside the new center.

S. Iswaran, Singapore's trade minister, was also in attendance. He said he expects Amazon's technologies to produce "significant gains in labor productivity and infrastructure utilization, as well as near real-time delivery of goods in the city." The Singapore government is also happy with the arrival of a new large-scale employer. According to Lim, the site already employs hundreds of workers.

Regarding plans to expand the geographic scope of service in Southeast Asia, Henry Low, director of Prime Now for the Asia-Pacific region, said in an interview with Bloomberg: "I am super-excited about prospects in Southeast Asia, with its burgeoning [middle-class] population. This is a great place for us to be in." Many took this as a declaration that Amazon is eager to enter other Southeast Asian markets and will use Singapore as its base camp for regional expansion. The company declined to elaborate on Low's remarks.