Author: Paul Winslow, Marketing and Communications Manager, PaySec
It has an internet penetration rate over 40%, approaching 30 million users, and fits the model of Asian countries undergoing a digital revolution allied to increase in middle class wealth.
The country’s 3G infrastructure was completed in 2013 and led to an explosion in social media subscribers and smartphone sales. Reduced mobile charges consolidated that and the introduction of 4G in 2014 merely added to the momentum.
Mobile penetration has driven the use of the internet in general and eCommerce, whether the final purchase is made on a mobile device or desktop. Social media is a huge driver in the purchasing journey, with Facebook the most popular social media for Thais to research a product, read customer reviews and share their online shopping experience after purchase.
Thais also love to shop for foreign brands. L’Oreal and Estee Lauder are just two of the popular cosmetic brands. 56% of Thais are willing to buy products offshore for better prices, while 46% like to purchase local products.
Typically for emerging Asian markets the payments infrastructure is fractured as new technologies vie for penetration against each other but also against the traditional and trusted methods of payment. Cash on delivery is still one of the preferred methods of payment, but attitudes and cultures are changing.
The new market has led to a lot of different payment solutions. LINE launched Line Pay, Facebook has trialled its own payment option, while Alibaba’s AliPay has extended into Thailand. These fight against more traditional methods, including debit card payments.
The government has also introduced its own epayment system called PromptPay in an attempt to stimulate digital payments and offer a digital wallet solution for the masses.
Many Thais are still conventional when it comes to payments and would opt to choose cash on delivery instead. For young demographics slowly accepting online payment, they see it as the most convenient way for online transactions but still 80% are using bank transfer as their mode of payment online or debit as their second option.
Fulfillment for eCommerce merchants wanting to do business in Thailand is getting easier. As markets open up, more and more businesses look to take up the demand, as indicated by DHL’s early 2016 announcement of a domestic delivery service in the country. More and more third-party services offer fulfillment and storage solutions, so do your research carefully.
It’s undeniable that Thailand is an ideal place to stake a claim in the Asian eCommerce gold rush. While old ways remain, the pace of change is so quick that it will never be too early to make inroads. Time to Thai up your next Asian market?