Online shopping to retain momentum

Online shopping to retain momentum

Pawoot: JSL to lead in online retail
Pawoot: JSL to lead in online retail

Online will become a major channel for shopping in Thailand in 2021 with e-commerce giants JD, Shopee and Lazada dominating the segment and community retailers expected to take a hit, says e-commerce pundit Pawoot Pongvitayapanu.

"In 2021, the online channel will play a crucial role in the country's economy," Mr Pawoot said. "The pandemic has totally changed Thais' behaviours towards online shopping."

Mr Pawoot, chief executive of e-commerce platform Tarad.com, said online platforms have become crucial for many Thais shopping in various product categories.

The government's stimulus schemes have encouraged people to jump into online shopping while the e-commerce trio of JD, Shopee and Lazada, known as JSL, is ready to offer promotions and subsidies to attract shoppers, he said.

"Most online shoppers are upcountry, they shop online more than people in cities and younger generations are becoming accustomed to shopping online primarily," he said.

"This is the time to open shops on JSL and social media platforms or build websites."

According to Mr Pawoot, JSL will dominate online retail for a wide assortment of products and see Thais spending in major shopping festival events, such as 11:11 and 12:12.

Spending will be drawn to online channels, which will have a crucial impact on local vendors since shoppers will opt to shop online for a greater choice of products at lower prices.

"Vendors upcountry need to offer a wide assortment of products at different prices," he said, adding they may have to onboard e-commerce platforms.

Mr Pawoot said competition in the courier service segment is also a boon for online trade, offering cheaper and faster delivery services. Online payment can be done through a variety of methods, including mobile banking, PromptPay and e-wallets.

In 2021, manufacturers and brands will pivot towards direct-to-customer strategies bypassing retailers, he said. They aim to open their shops on e-marketplaces.

Referring to online food delivery, he said the segment will see an exponential growth and the service will be offered nationwide.

"Food vendors should join delivery apps and expand to provinces under cloud kitchen models," Mr Pawoot said.

According to Mr Pawoot, foreign online giants, such as Facebook, Line and Google, would jump into e-commerce in 2021 with their own networks, which will cover online shop creation, payment and advertising services.

He said advertising fees on online channels would shoot up and that smarter ad creation at reasonable prices is necessary. Many more tools for ad creation would also be rolled out.

Mr Pawoot said customers would be grouped in terms of behaviour and lifestyles, rather than demographics, and content and products would be chosen to serve them.

Marketing approaches need to focus on smaller groups of customers but need sharper analysis of products that serve targets, he said.

In 2021, influencers will play a key part in shoppers' decisions and brands will rely more on them, said Mr Pawoot.

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