2018 RETAIL ASIA-PACIFIC TOP 500
OVERVIEW a strong foothold , making such stores an appealing shopping destination for many consumers . Supermarkets is also likely to benefit strongly from outlet expansion efforts , and the opening of neighbourhood stores that tap into the consumer demand for proximity and convenience .
— Ting Huang , Analyst
THAILAND
Retailing records a stronger performance in 2017 Retailing witnessed stronger current value growth in Thailand during 2017 , with non-store retailing driving growth . Thailand ’ s GDP growth is expected to pick up from 3 % in 2016 to reach 4 % in 2017 , owing to stronger exports and tourism . This improvement in the economy also brought an improvement in unemployment , which stood at just 1 % in 2017 . This benefited consumers ’ disposable incomes and boosted their confidence in spending , therefore increasing growth in retailing . Middle- to high-income consumers remained the key target group for many retailers , as they demanded premium products and services to indulge their desire for better lifestyles .
Luxury apparel and footwear specialist retailers rebounded in current value terms in 2017 , and premium retailers such as grocerants expanded . The increased presence of aspirational consumers , due to improved disposable incomes , also created opportunities for channels such as Internet retailing and specialist retailers , as these consumers sought novel brands and products . As retailers sought to innovate and align with consumers ’ evolving preferences , this also resulted in the increasing blurring of channel formats . For instance , convenience store Family Mart launched a new outlet in 2017 , which houses Segafredo Zanetti , a specialist coffee chain , and Bread Today , a bakery shop , as well as sells fresh fruit and cooked meals even offering a delivery service .
Internet retailing continues its transformation Internet retailing continued to gain popularity in Thailand during 2017 , with the channel expected to strengthen throughout the forecast period . Internet penetration stood at over 80 % in Thailand during 2017 , and the government ’ s commitment to building a broadband network for all rural areas under the “ Thailand 4.0 ” policy will further increase consumers ’ access to the Internet , therefore benefiting Internet retailing . Internet retailers ’ continued investment in enhancing logistics services and payment platforms also increased consumers ’ confidence in shopping online , although the majority of consumers still preferred to visit stores to see and feel products before purchasing .
Internet retailing is expected to increasingly be driven by mobile devices rather than computers or tablets . With smartphone penetration set to reach more than 50 % by 2020 , consumers ’ eagerness to shop on-the-go will be heightened ; seeking instant gratification rather than having to wait until they have computer access . Realising this opportunity , retailers have already increased their efforts to create mobile shopping apps , and also dedicated promotions for this mode of shopping to drive consumers ’ interest and awareness . The growth potential of Internet retailing in Thailand also attracted new players , with more players expected to enter the country in the forecast period , which is expected to lead to fragmentation . Consequently , existing players , such
as Lazada , will continue innovating in terms of offerings and services to maintain high customer satisfaction .
The competition intensifies in retailing Within the fragmented landscape in retailing in Thailand , local retail groups including CP All , Ek-Chai Distribution System , Central Group and Big C Supercenter have emerged as the leaders . Besides having their own retail brands , some of these local players also act as franchisees for international brands ; for instance , CP All for 7-Eleven and Ek-Chai Distribution System for Tesco . While these local retail chains lead due to their long-standing presence , the evolving retail landscape in Thailand , including the constant growth of Internet retailing , also saw these players investing to transform their models to ensure alignment with consumers ’ needs .
However , the competition in retailing in Thailand increased in 2017 , particularly in Internet retailing , and this is expected to continue throughout the forecast period , due to the attractive market potential . February 2017 saw the official launch of the Korean marketplace 11Street , which managed to capture a healthy share in Internet retailing in Thailand within a short period . JD . com , a leading Chinese e-commerce player , also announced a joint venture with Central Group to launch a new marketplace platform , JD . co . th , in April 2018 . Besides these international giants , niche brands are expected to set up e-commerce , as they seek to target consumers ’ eagerness for novelties .
New formats emerge to attract consumers With higher disposable incomes and greater sophistication , consumers will continue to increase their expectations of retail offerings over the forecast period — be it new brands , the provision of convenience or value-added services . To ensure they remain relevant , retailers have thus invested in rejuvenating their stores , such as Central Group ’ s Bt350 million ( US $ 11 million ) investment to revamp and rebrand its department stores in order to keep shoppers in stores for longer .
Retailers also explored new concepts to provide added convenience for consumers , as well as novelty . For instance , Family Mart ’ s new Holiday Inn Silom Store , opened in February 2017 , houses a Segafredo Zanetti coffee shop , Bread Today bakery , as well as offering products beyond packaged goods , including fresh fruit , cooked meals and more . Premiumisation to target middle- to high-income consumers , particularly millennials , was also noted , with the launch of grocerants in supermarkets . Positioned as premium supermarkets , grocerants provide a dine-in service , whereby consumers can select the ingredients in the supermarket and then pass them to a chef for preparation . This concept allows consumers to enjoy a freshly-cooked meal at a reasonable price , compared with dining at a full-scale foodservice outlet .
Retailing is expected to continue to see growth Retailing is expected to register a positive performance in value terms at constant 2017 prices over the forecast period . Thailand ’ s economy is projected to pick up further over the forecast period , with 2018 GDP growth set to remain at 4 %, stemming from increased government spending and infrastructure projects . Consequently , this will benefit consumer confidence , brought about by an improvement in disposable incomes and low unemployment . Non-store retailing , driven by Internet retailing , will continue to lead growth within retailing . Mobile will steer the development of Internet retailing , as smartphone penetration continues to rise , and consumers are more eager to access
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