Due to the growth of the middle class and the rise of mobile e-commerce, more and more Thai consumers are turning from offline shopping to more convenient online shopping. According to Google and Temasek, by 2025, the size of Thailand’s e-commerce market will reach US$11.1 billion, ranking second in Southeast Asia, second only to Indonesia. Thailand’s market potential is obvious, such as consumers’ continued income growth and high acceptance of new things, so there are still many opportunities in Thailand’s e-commerce market.
(I) The rising middle class
By 2030, the number of middle-class and wealthy people in Thailand is expected to exceed that of Malaysia, and the number of wealthy people in Thailand is currently growing faster than the middle class. The steady rise in income is gradually driving consumer demand and purchasing power, which provides opportunities for companies that cater to consumption upgrades and provide consumer goods, luxury goods and experiential services.
(II) The rise of e-commerce and mobile payments
The surge in mobile e-commerce in Thailand is a noteworthy trend. According to data released by the Thai National Bureau of Statistics in January 2017, mobile phone users account for 96% of the total population in Thailand, of which 70% own smartphones, and more than 90% of Internet users access the Internet through smartphones. Thailand’s mobile traffic accounts for 79%, second only to Indonesia. Similar to other Southeast Asian countries, Thailand’s mobile traffic is highest on weekends, with 84% on Sundays. In terms of social media, LINE is one of the most popular platforms in Thailand, and Thailand is the only country in Southeast Asia that uses LINE as the main instant messaging application. In Thailand, 70% of e-commerce transactions still use cash on delivery, which is due to Thai people’s concerns about personal property security and information leakage. A study on Visa mobile payments and non-cash payments showed that 82% of Thais believe that security is more important than convenience in mobile payments and non-cash payments. However, Thais are still receptive to mobile payments, and 61% believe that in the future they will no longer need to carry bank cards or cash, but can use mobile payments for daily consumption.
(III) Social e-commerce has become a trend
Thailand is the largest social e-commerce market in Southeast Asia. Thais spend an average of 4 hours on their mobile phones every day. About half of Thais like to buy goods through social networks. Thais have a special liking for social e-commerce, and many consumers say they enjoy communicating with sellers on social media. The driving force behind social media shopping is interpersonal interaction, such as comments and feedback on social media.
Social e-commerce refers to sellers who set up stores on social platforms (such as Facebook and Instagram). Shop owners post products on these platforms, and online shoppers can browse the products and decide whether to buy them based on the product information provided by the seller. In August 2017, Facebook realized this demand and launched its first Facebook store. Based on the unique consumption patterns of Thai consumers, Shopee was the first to discover business opportunities. Shopee tried to attract sellers active on social networks by providing easy-to-integrate Instagram stores and compensating shipping costs, and agreed to let sellers sell goods through cash payments.