With international travel still up in the air, how can brands in Thailand reset marketing strategy to better connect with COVID-impacted local consumers? WARC's Asia Editor, Gabey Goh, introduces a deep-dive into the insights you need to know.
Thailand has enjoyed decades of global renown as a premier holiday destination, with a tourism and travel industry that accounted for 18% of its GDP just last year.
But COVID-19 has changed all that.
While the country, known internationally as the “Land of Smiles”, has largely been successful in containing the virus within its own borders, the uncertainty clouding the rest of the world means that it will have to look inward to shore up its economy.
Via a 22.4 billion baht (US$718 million) domestic tourism stimulus package, the government is looking to capture at least 75% of the 400 billion baht (US$12 billion) Thai nationals spent abroad in 2019. To do so, it is targeting 100 million domestic trips worth US$28 billion in revenue for 2020.
This would still be a far cry from the US$64 billion that 39 million international visitors bring to the economy annually. And now that lucrative foreign shoppers are no longer a staple of the country’s cities and island resort towns, marketing strategy must now focus on winning over an exclusively local consumer base. One that has also been impacted by the psychological and economic effects of the pandemic.
It is a reset that goes beyond just brands operating in the Luxury/Retail/Hospitality verticals, though they are the ones that feel this need most urgently. Even brands that have long focused on the domestic market, must factor in the simple fact that the pandemic has left few lives untouched and unchanged.
In an episode of Netflix’s culinary documentary series Chef’s Table, Bo Songvisava, co-chef and co-owner of Bangkok’s Bo.Lan explained that “Thailand is a hospitality[-driven] country.
“Whatever you ask, it’s, ‘Yes, I can do that for you.’ Thais have been serving what the customer wants.”
The core question brand marketers across Thailand are now asking themselves is: “How well do we really know our Thai consumers? And more importantly, how do we serve them what they want?”
That’s why it came as no surprise that our expert contributors chose to focus on crafting a clearer picture of post-pandemic Thailand for this edition of WARC’s Spotlight series. A logical first step in building new strategies for a 70 million-strong population known for their creativity and resilience.
Since the pandemic hit in March, 70% of Thailand’s national workforce has seen their average monthly income decline by 47%. The majority of Thailand’s workforce is made up of the millennial generation between ages 25-34 years. Interestingly, the population of female working adults is 2% higher than the country’s female population. Understanding the multiple personas that make up Thailand’s working population, a key demographic for many brands, necessitates an audience segmentation strategy that is responsive while being data-driven.
“Marketers trying to leverage the upswing in spend momentum and consumer movement need to take a data-driven approach to reacquaint themselves with the new personas that now make up Thailand’s working adult population,” says ADA Thailand’s Suppakit Limboonsong.
The team from VMLY&R observes that strategies aimed at capturing the attention of local consumers, may be easier said than done. For starters, Thai nationals have a drastically different perception of their nation compared to foreign travellers: “Thai people perceive their country brand as ‘powerful’, whereas both Chinese and British people view the country as being well known but undifferentiated.”
It also doesn’t help that Thai brands have long resisted putting brand purpose at the centre of their strategies, in favour of price and feature races, coupled with an overreliance on celebrity endorsements.
“Today, a top Thai celebrity can be working with anywhere between 30-40 brands at one time. Truth is, the only brand to benefit from this situation is the celebrity!” writes the VMLY&R team. “Thai consumers today are smarter than they’ve ever been, and brands who don’t pivot their strategy to align with what they need and value most, will be those who are left behind.”
The mission to align with what consumers need and value, cannot be done without factoring in generational differences as new research from Far East Fame Line DDB has uncovered some distinct attitudinal differences.
The agency’s executive director Chalinee Hirano shares that there have been notable differences between each generations’ reflection on their lockdown experiences, as well as the degree to which each generation has adopted the new normal. Baby boomers would rather continue staying home, enjoying their cocooned life and hobbies while Gen X are more inclined to indulge in revenge spending and travel.
There’s also been renewed interest in local brands during the pandemic, mainly in categories such as dessert, fresh produce, personal care products, apparel, beverage, and hygiene products. “Online marketplaces have enabled small local brands which previously had never made it to supermarket shelves to become more viable. During the lockdown, interests in these small local brands has spiked up,” writes Hirano.
While local brands are enjoying a newfound place of importance with Thai consumers, hard-hit travel brands have a steeper hill to climb. One opportunity lies in meeting the needs of families, keen to wean children off mobile devices after lockdown caused usage to soar.
“Domestic travel businesses should shift their message to target this group based on the types of shared family experiences that are engaging for children and explicitly positioned as the healthy alternative to screen-time,” writes OMD Thailand’s Issarisa Khamswas. “From a convenience and affordability need, proximity targeting, and low-cost activities are key.”
Ultimately, the key in a COVID-19 impacted economy is to re-adjust marketing strategies and re-connect with consumers “on tangible value exchanges that are grounded on fiscal affordability and emotive need”.
Read more in this Spotlight series
Brands need a serious readjustment to truly connect with Thai consumers
Ekaluck Charanvas, Ponghatai Sreesing, Hari Ramanathan, Kunakorn Sansuk
Understanding the generational differences in how Thailand’s consumers live in the “new normal”
‘Getting to know urban Thailand’s new post-pandemic personas