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26 May 2016


Online Channel Plays Bigger Role in Modern Trade (Current Issue No. 2741 Full Ed.)

Online shopping has grown significantly, thanks to changing consumer lifestyles and IT development, which enables speedy communication through the internet. As a result, modern traders have increasingly adopted e-commerce to expand their distribution channels, and have boosted sales appreciably over the past few years. KResearch expects that modern trade retailers' online shopping activity will reach THB35 billion, growing 15-20 percent YoY and representing about 3.0 percent of all modern trade retailing. This market is expected to grow 5.0 percent to THB50 billion in the next two years (2018).
Growth of Thailand's online shopping will bring cutthroat competition. In the near future, KResearch expects that the e-commerce market will see increasingly intense competition, not only among modern traders themselves, but also among modern trade and other online trade segments, e.g., e-marketplaces, business-to-customer (B2C) small and medium enterprises (SMEs), who sell their products via social media like Facebook, Instagram, and LINE, earning the moniker 'social online trade', or those who develop their own online shopping websites, etc. Additionally, instead of limiting the competition to other Thai businesses, many operators will elevate their competitive potential to compete with foreign entities that aim to reap market share in Thailand's online shopping market.

Given this, modern trade retailers may need to adjust themselves in preparation for intense competition. They should consider strategies that will enable them to comprehensively accommodate changing consumer needs and eliminate weaknesses, or help customers overcome their concerns over purchasing goods online, while keeping in mind the key elements of online shopping, i.e., uniqueness, speed, and security.

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