KResearch views that inflation, rising living costs, uncertainty surrounding COVID-19, and impacts from the potentially prolonged unrest in Ukraine will continue to affect the economy and consumers’ purchasing power. B2C e-commerce (for products only) may grow by around 13.5 percent or approximately THB 565 billion in 2022. However, this figure indicates slower growth and represents a trough compared to the past three years, with 40 percent growth p.a. on average.
Consumer behavior has also shifted, as more people seek to reduce their spending via physical stores and instead make their purchases via online platforms (e-commerce) under a more limited or relatively unchanged budget, especially of food and personal care products which were previously bought by consumers at physical stores, including hypermarkets, supermarkets and convenience stores. However, change in consumer behavior and retailers’ adoption of the omnichannel (offline to online) strategy has resulted in an increase in the volume of shopping via online platforms. This is reflected in the results of several retailers whose sales via online platforms doubled or tripled in size over the past year. That said, overall sales did not attain significant growth and/or have experienced limited growth (primarily attributed to price), in line with the findings of our survey on Thai consumers, who are increasingly expected to shop via online platforms in 2022, though their budget may remain unchanged or may be more limited.
In addition, operators will still encounter fierce competition and freight charges that could become more expensive as oil prices skyrocket. This would consequently undermine the growth of e-commerce business, going forward. Therefore, operators should make plans to cope with those challenges, especially through quality control in adherence to standards for good and consistent online service provision in order to bolster consumer confidence amid diminishing differences between the types of products sold via online platform.