Thailand ranks 2nd in the world when it comes to the adoption of online shopping, and the government is anticipating to bring in close to $100 million USD in VAT from eCommerce this year— it is safe to say that eCommerce in Thailand is booming.
The impact of the recent pandemic has further spurred on the growth of this already lucrative market, worth over $4.32 billion USD, and has encouraged retailers across industries to take it more seriously.
As the market grows, how is the landscape of online shopping changing in Thailand? To find out, we take a closer look at eCommerce and the emerging trends in this sector in the country.
Innovative marketing strategies
Thais have been online shopping increasingly this year due to movement restrictions and heightened fears caused by COVID-19. To further enhance the country’s market share, some of the country’s most prominent players in eCommerce are upping their marketing game and using targeted strategies and big data to attract more people. One such company is Lazada— long considered one of Southeast Asia’s kings of commerce. It was the first online shopping app to feature live streaming, LazLive back in 2018 and has been further developing this feature in the past few months.
Are you interested in Thailand’s ecommerce industry? Read more about the impact of COVID-19 on the market.
Lazada held a “talent contest” called LazTalent to find new presenters for its live online promotional activities. This program was a massive success and brought the app over 3,000 promoters and thought leaders in Thailand and Vietnam. In conjunction with the LazLive drive, Lazada introduced an affiliate programme to aid promoters and salespeople to sell online. It offers sales commissions to promoters for using the company’s social channels and the live streaming functions on the app, resulting in more visits to the platform and an increase in sales.
While Lazada is finding new sales talent, rival Shopee is on the hunt for technical prowess. The Shopee Code League 2020 currently has over 20,000 competitors from all over Southeast Asia, China and Taiwan. The aim is to help students and professionals upskill in the use of technology, big data, artificial intelligence and robotics through a series of competitions and challenges. Workshops and training using real-life data sets are used to train participants for the digital future. This kind of hands-on approach helps to build a connection between customers and the company and inspire brand loyalty while also giving much-needed skills to participants.
Another evolving trend in eCommerce in Thailand is the increasing engagement with brands and established stores. When shopping first started moving online, there were clear distinctions between a branded store and a platform such as Amazon or eBay. The latter often didn’t have the stock or full range of products, and there were more chances for fakes and inferior products, while the branded stores were unable to get as big an audience by being standalone.
Now, partnerships between traditional brands and eCommerce platforms are bringing authentic products, merchandise and branded goods for sale in the general “mall”, giving them a bigger audience and allowing consumers to feel more confident in their purchases. This direct-to-customer (DTC) strategy presents an opportunity for both the brand and app, especially now when COVID-19 has changed how people shop.
Shopee Mall was born in March 2018 to provide consumers with access to authentic products from big brands, as well as the choice to shop for bargains and niche items from smaller retailers. Combining the experience created a one-stop-shop for customers, all backed with Shopee guarantees and free shipping. Similarly, the LazMall concept delivers name brands and smaller boutiques in one place to make online shopping more convenient and safe.
Recently, Lazada increased its commitment to delivering a well-rounded shopping experience through its partnership with GroupM. This tie-in allows a two-way flow of information between the eCommerce giant and the media agency to create a more effective usage of data, insights and branding tools. It has the potential to totally change the game in Southeast Asia as Lazada shares its eCommerce knowledge to help GroupM formulate campaigns and understand the buyer profiles of the region. In return, the brands represented by the agency get a better deal with Lazada.
Entering the 5G era
Thailand is rapidly rolling out a 5G network and sees access to faster internet as part of the roadmap to recovery post-COVID-19. Pilot programmes such as a smart airport in Krabi and 5G-powered car for medical deliveries are pushing the government’s Industry 4.0 agenda ahead at speed.
We explore why Thailand is going strong in the 5G race.
For eCommerce, faster connections, and more reliable and widespread internet is fantastic news. It will allow the industry to increase its reach and implement more social commerce and immersive shopping experiences. Engaging customers through games, competitions, and entertainment helps to build brand loyalty and connections, which in turn add to sales conversions. With 5G behind the scenes, the potential is almost limitless.
These trends, combined with improved infrastructure and a highly engaged population, are sure to see eCommerce in Thailand thrive long after the sales-boosting pandemic is gone.