Market Research in Thailand
Have you ever wondered how businesses successfully navigate the complex market of Thailand? Thailand’s unique blend of cultural richness, economic growth, and technological advancement makes it a fascinating country for market research.
That’s why market research in Thailand has become a vital tool for businesses to understand and adapt to the changing market trends, consumer behaviors, and competitive landscape.
Why Is It Important to Conduct Market Research in Thailand?
In Thailand, consumer behaviors and preferences are deeply rooted in cultural norms and societal values. Understanding these cultural underpinnings is essential for businesses to connect with their audience authentically. Market research in Thailand helps uncover these cultural insights, enabling businesses to tailor their products, services, and marketing strategies to resonate with the Thai consumer.
Moreover, Thailand’s economy is characterized by its diverse sectors, ranging from agriculture and manufacturing to digital technology and tourism. Each of these sectors operates within its own set of market dynamics and consumer expectations. The Thai market is also notable for its receptivity to international brands and products. However, entering this market without a nuanced understanding of local preferences and market conditions can lead to missteps.
Additionally, the digital landscape in Thailand is rapidly evolving, with a significant increase in internet and social media usage. This digital shift is changing how consumers interact with brands and make purchasing decisions.
Benefits of Market Research in Thailand
Engaging in market research in Thailand offers numerous advantages for businesses to effectively tailor strategies to meet consumer needs – and here are some of the key benefits:
• Competitive Advantage: By understanding the competitive landscape through market research in Thailand, businesses can identify their unique selling propositions and differentiate themselves from competitors.
• Risk Reduction: Market research helps in identifying potential challenges and market risks in Thailand, allowing businesses to develop strategies to mitigate them.
• Market Trend Identification: Market research helps in spotting these trends, enabling businesses to stay ahead and capitalize on emerging opportunities.
• Product and Service Optimization: Insights from market research guide businesses in refining their products and services to better suit the Thai market, enhancing customer satisfaction and loyalty.
• Marketing Strategy Development: Understanding the market dynamics and consumer preferences enables businesses to create effective, targeted marketing campaigns that resonate with the Thai audience.
• Identification of New Opportunities: Market research can uncover new business opportunities in Thailand such as untapped market segments or emerging consumer needs.
• Cultural Insights: Gaining cultural insights is crucial in a diverse market like Thailand. Market research helps in understanding cultural nuances, which is vital for successful marketing and operations.
The Top Industries of Thailand
Thailand is a newly industrialized country with the second-largest economy in Southeast Asia. Small or medium-sized enterprises (SMEs) make up over 99.8% of the enterprises in Thailand. They contribute a significant amount to the country’s GDP.
SMEs are responsible for over 80% of the total employment. These enterprises are the reason for Thailand’s low importation rates, and they have boosted manufacturing and expanded exports.
Automotive and electronics are the two major manufacturing industries in Thailand. The nation has the largest automotive industry in Southeast Asia, producing around two million vehicles per year and exporting cars, trucks, and automotive parts. A few of those brands include Ford, Volkswagen, Mercedes, and BMW.
Thailand is ranked 20th in the world’s exporting economies. Manufacturing is the top industry in Thailand and is also responsible for 34.5 percent of the GDP.
Electronics is Thailand’s number one industry, comprising 15 percent of the country’s total exports. Computer and integrated circuits are the prominent exports within the category, and Thailand is the world’s second-largest manufacturer of hard drive disks.
Following are plastics, rubbers, and food. Each year, Thailand exports $24.9 billion worth of plastics and rubbers and $17.4 billion worth of foodstuff.
Main Players in Thailand
Identifying the main players in the Thai market is crucial for businesses conducting market research in Thailand. These companies, through their market presence, innovations, and strategic decisions, significantly shape various industry sectors in Thailand. Here’s an overview of the main players in key sectors:
• Automotive Industry: Toyota Motor Thailand dominates the automotive sector in Thailand and is known for its production and export of vehicles. Honda Automobile Thailand is also another key player in the automotive industry, with significant manufacturing operations.
• Electronics and Technology: Western Digital has major operations in Thailand, especially in the manufacturing of digital storage solutions.
• Agriculture and Food Processing: Charoen Pokphand Foods (CPF): A leading agribusiness and food conglomerate, influential in both domestic and global markets. Thai Union Group is Known for its seafood processing and export, making it a significant player in the global food industry.
• Finance and Banking: Bangkok Bank is one of Thailand’s largest and most influential banks, offering a comprehensive range of financial services. Kasikornbank offers innovative financial products and has a strong presence in the Thai banking sector.
• Real Estate and Construction: Sansiri Public Company Limited is a leading real estate developer in Thailand, known for its high-quality residential properties.
Main Tourist Attractions in Thailand
Tourism plays a vital role in Thailand’s economy, and understanding the main tourist attractions is crucial for businesses conducting market research in Thailand. The country’s rich cultural heritage, stunning natural landscapes, and vibrant cities attract millions of tourists each year. Here are some of the most notable tourist attractions:
• Bangkok: This city has attractions such as the Grand Palace and Wat Phra Kaew, which is an iconic historical site that showcases Thailand’s rich history and architectural grandeur.
• Chiang Mai: The city is known for its beautiful ancient temples like Wat Phra Singh and Wat Chedi Luang.
• Phuket: It is famous for its beaches, vibrant nightlife, and water activities.
• Pattaya: Famous for its nightlife, with a wide array of bars, restaurants, and entertainment options.
Thailand’s Unique Neighborhoods
The famous Khao San Road in Banglamphu, also known as the “backpacker ghetto”, is a Bangkok strip. It’s usually bustling with tourists who come to patronize the cheap restaurants. This strip also has bars, hotels, and other nightlife establishments. They add a rugged charm to the neighborhood.
Due to the Covid-19 restrictions, the businesses in this area have taken a massive impact. Foreign tourists made up 90% of the visitors to Khao San Road. The neighborhood is now completely bare, and businesses are in a large slump.
To return the business to the strip, Bangkok’s government has implemented a plan to reopen trade. It will add vendors and promotional events to make Khao San Road appealing to local visitors. This plan aims to reduce dependence on the usual commerce directed at foreign visitors.
On the other end of the luxury spectrum is Sukhumvit. This neighborhood is both a commercial and pleasure center in Thailand. Business during the day and the nightlife are full of excellent services. Many shops, restaurants, malls, and five-star brand hotels make this zone popular among locals, ex-pats, and tourists.
The Top Trends in Thailand
Staying abreast of current trends is crucial for businesses conducting market research in Thailand. These trends reflect the evolving landscape of consumer behavior, technological advancements, and economic shifts in the country. Understanding these trends can help businesses tailor their strategies to the Thai market’s unique characteristics. Here are some key current trends in Thailand:
• Digital Transformation: There’s a significant shift toward digitalization in Thailand, with an increasing number of consumers engaging in online shopping, digital payments, and social media.
• Rise in Health and Wellness: Thai consumers are showing a growing interest in health and wellness products, including organic foods, fitness, and wellness services. This trend is driven by increased health awareness and lifestyle changes.
• Sustainable and Eco-Friendly Practices: Sustainability is becoming a key concern among Thai consumers. There’s an increasing demand for eco-friendly products and services, as well as a greater focus on corporate social responsibility.
• Urbanization and Lifestyle Changes: Rapid urbanization, especially in cities like Bangkok and Chiang Mai, is leading to changes in lifestyles and consumer behavior.
• Emerging Consumer Segments: New consumer segments, particularly among the urban middle class and younger generations, are emerging with distinct preferences and spending habits.
• E-commerce and Mobile Commerce Growth: Online shopping, driven by mobile commerce, is growing rapidly. Consumers are increasingly using smartphones for shopping, payments, and accessing services.
• Changing Retail Landscape: The retail industry is evolving with the integration of online and offline channels, leading to the growth of omnichannel retailing and personalized shopping experiences.
• Technology Adoption in Businesses: There’s an increasing adoption of technology in business operations, including the use of AI, IoT, and big data analytics, to improve efficiency and customer experiences.
Opportunities in Market Research in Thailand for Businesses
The evolving landscape of Thailand presents numerous opportunities for businesses – and leveraging these opportunities is key for strategic decision-making and capturing market potential. Here are some key opportunities identified through market research:
• Health and Wellness Sector: The growing trend towards health and wellness opens up opportunities in sectors such as organic foods, fitness equipment, wellness apps, and health-focused tourism.
• Sustainable Products and Services: The rising consumer awareness about environmental issues in Thailand creates opportunities for sustainable, eco-friendly, and ethical products and services.
• Tourism Revival and Innovation: There are opportunities for innovative travel services, sustainable tourism, and cultural experiences that align with the global trend toward responsible and experiential travel.
• Urban Lifestyle Products and Services: Rapid urbanization, particularly in cities like Bangkok, offers opportunities for products and services catering to modern urban lifestyles, including convenience services, luxury goods, and modern retail concepts.
• Emerging Consumer Segments: The rise of new consumer segments, especially among the urban middle class and millennials, presents opportunities for businesses to target these groups with customized products and marketing strategies.
• Adoption of New Technologies: With the increasing use of technologies such as AI, IoT, and big data analytics in business, there are opportunities for companies to innovate and improve operational efficiency and customer engagement.
Challenges of Market Research in Thailand for Businesses
Conducting market research in Thailand has unique challenges for businesses. These challenges stem from Thailand’s diverse market landscape, cultural nuances, and the rapidly evolving economic and technological environment.
• Cultural Complexity: Thailand’s rich and diverse culture deeply influences consumer behaviors and preferences. Understanding these cultural nuances is essential but can be challenging for businesses, especially those new to the Thai market.
• Language Barrier: For international companies, the Thai language can pose a significant barrier. Accurate translation and contextual understanding are crucial for effective communication and data interpretation.
• Digital Divide: Despite the growth in digital usage, there remains a divide between urban and rural areas as well as among different demographic groups. This can impact the reach and effectiveness of digital market research methods.
• Diverse Market Segments: Thailand’s market comprises diverse segments, ranging from high-income urban consumers to rural populations. Catering to and understanding the needs of these varied segments can be challenging.
Protecting the Thai Consumer: The Consumer Cases Act
Thailand consumers have faced obstacles in the past when taking action against businesses. Time and funds were lacking on the consumer’s side, and any reward given was insignificant.
Then the Thai government introduced the Consumer Cases Act in August 2008. It was in response to consumers broadcasting their struggles through the media. These consumers were also criticizing the laws at the time. The first law of the Act allowed the consumer more authority against businesses. It also introduced a more straightforward process for legal action.
Most consumers cannot regulate the manufacturing and design of countless low-quality imports. The second law of the Consumer Cases Act protects those consumers. It addresses Thai consumers afflicted by unsafe products, and product liability now receives heavier scrutiny.
Online shopping in Thailand has seen a significant increase in most products. This increase is exclusive of more valuable and scrutinized products like jewelry. It also excludes perishable goods. This second Act allows consumers to shop for lower-quality products with less risk of injury to their health and homes.