Thailand’s e-commerce market is set for booming growth in 2016 riding on the back of the recent launch of fourth-generation (4G) services.
Thai E-Commerce Association’s president Pawoot Pongvitayapanu, in an interview with DEALSTREETASIA, says, Thailand is the fastest growing e-commerce market in Southeast Asia. Currently, there are over 500000 e-commerce users in Thailand.
“Thai people will become more active with online shopping. And, 4G will be a factor to drive the growth of e-commerce, as well as to turn offline businesses into online,” he said.
“Everything will be active on mobile soon as demand has been increasing continuously. The number of internet users in Thailand is 43 per cent of the total population, and is forecast to increase to 50 per cent next year.”
The Electronic Transactions Development Agency (ETDA) reported that the value of Thai e-commerce market was forecast to be 2.1 trillion baht ($58.4 billion) in 2015, up 3.65 per cent from 2014. The ETDA estimated total value of the B2B e-commerce, which was the largest segment, would fall 0.34 per cent in 2015 from 1.23 trillion baht in 2014. Meanwhile, the B2C is forecast to rise 15.29 per cent from 410 billion baht last year, as same as the B2G to grow 3.96 per cent from 390 billion baht.
According to the ETDA, the top three categories that have generated the highest income from e-commerce in 2015 are accommodation and food services worth 658.9 billion baht, followed by manufacturing 350.29 billion baht, and retail and wholesale 325.08 billion baht.
The top three trends to look out for in Thailand’s nascent e-commerce market in 2016 are:-
Digital content, mobile games to be rising stars
Thailand’s major telecom operators have announced that they will invest heavily into acquiring digital content and games to serve the rapidly-growing demand.
True Digital Plus, for example, has increased its budget from $1 million this year to $3 million to buy digital content in 2016.
There are over 22 million online gamers in Thailand, who are active on either smart devices or personal computers, Mana Prapakamol, general manager of True Digital Plus, said.
“From our survey, the total value of gaming market in Thailand is probably as high as $170 million and mobile games accounts for 2 billion baht ($55.56 million), which is forecast to expand more than 30 per cent next year,” he said.
Fresh food to make rapid strides
As the founder of Thailand’s leading online marketplace tarad.com, Pawoot pointed out that fresh food is a rapidly-growing market as it responds to the lifestyle of urban dwellers. “People nowadays select more healthy foods – either local made or import. Previously, e-commerce would focus on fashion and consumer products, but I think fresh food will be trendy for e-commerce operators next year,” he said.
Price wars will harm growth
As the number of sellers grow steadily, Pawoot has expressed his concern that they would compete fiercely on price.
Thai operators have disadvantages in the technology and capital areas compared to their counterparts from Japan and Singapore, who are active in the country’s e-commerce space. “If we focus only on price strategy, we die,” he said.
“What we have to pay more attention is to create customer relationship management. This is very important for e-commerce,” he added.