Thai consumers remain cautious spenders, particularly rural residents who find it difficult to earn more while their household debts are high, says the London-based Kantar Worldpanel, a consumer research firm under the WPP Group.
A customer looks for products at a supermarket in Bangkok's Ratchaprasong area. A survey found Thai consumers remained cautious about spending despite the political situation easing. PATIPAT JANTHONG
Its annual shopping behaviour survey of 4,000 households nationwide found Thai consumers made 4.9 billion shopping trips for consumer goods in the 52 weeks ending on July 13.
That was 4.1 shopping trips on average per week from Thailand's 22.5 million households.
Compared with the same period last year, shopping trips increased by only 3% due mostly to urban Thais, down from 7% growth the previous year. Spending by rural Thais contracted by 1%.
Kantar general manager Howard Chang said rural consumers averaged 4.8 shopping trips a week for consumer products, while urban Thais averaged 3.3 times a week. Urban consumers spent 132 baht per trip, while rural consumers spent half that.
The slower growth was in line with the economy, as the Bank of Thailand forecast GDP growth of only 1.5% in June.
Shopping trips slowed in the latest 12 weeks ending on July 13, indicating the economy was still stagnant. Mr Chang said it would have been a challenge for Thai retailers to increase shopping trips 7%, as the economy had not truly recovered, particularly in rural areas.
The problem is mounting household debt even though rural Thais cashed in on the rice pledging scheme and minimum wage rose to 300 baht a day.
Rural Thais cut their purchasing of unnecessary products such as hair conditioner, facial cleaner, mouthwash, laundry additives and toilet paper. They also bought less often and in fewer categories, reducing their quantity and paying less for different products, more promotions and different channels.
"Thailand urgently needs the interim government to add money to the fiscal system such as cash coupons or infrastructure projects," said Mr Chang.
He likened the current economy to 2008, when energy prices were high and consumer goods prices rose. Previous crises in 2006 and 2011 also took time for a recovery.
The premium segment has not been affected by the slowdown. Brands should not delay new product launches, as consumers will pay for items once they understand their value from marketing pitches, Mr Chang added.