The battle between e-marketplaces Lazada and Shopee is heating up as they both launch new marketing campaigns to attract spending from online shoppers and capitalise on the growing sector.
Thailand ranks first globally in terms of the percentage of internet users who buy products online each week, according to the "Digital 2022: July Global Statshot Report", conducted by We Are Social and Hootsuite.
According to Kasikorn Research Center, Thailand's online retail sales reached 565 billion baht in 2021, accounting for 13.5% of the total retail market. The share is projected to reach 16% this year.
"Overall Thailand's e-commerce continues to grow due to the expansion of the user base, but the growth is slower than during the pandemic, which saw an exponential rise in terms of users and sellers," said Thanida Suiwatana, chief business officer at Lazada Thailand.
Average online spending is expected to decline amid economic woes, but Lazada will try to increase purchases using more affordable price points and a greater assortment of products for shoppers, Ms Thanida said.
A total of eight out of 10 shoppers have continued to buy online despite the easing of Covid-19, she said.
LazMall, a brand-focused feature of Lazada, will also scale up its efforts to improve customer engagement and retention.
The firm is offering a "Try & Buy" programme that allows consumers to sample goods, mainly skin care products, that they are interested in before purchasing. The move is meant to speed up users' decisions, Ms Thanida said.
Lazada also offers a reward-based membership programme for brand partners to ramp up customer engagement. A total of 226 brands have participated in the programme.
It is also co-investing with brands in LazMall to boost their sales.
The company has vowed to continue its Double Day shopping festivals and mega shopping campaigns, during which spending surges 2-3 times.
Lazada will offer discounts of up to 90% in its 9.9 shopping festival.
Ms Thanida said Lazada is working on a "buy now pay later" scheme to help ease the public's rising cost of living.
She said that brands should focus on customer insight to understand market trends in the post-pandemic world. For example, people are now spending more on lipstick, travel bags and fashion.
Thailand is one of the most important markets for Lazada due to a large customer base and substantial spending, while Vietnam is one of the fastest-growing markets due to its large young population.
"We are expanding our customer base to the young as the majority of our customers are aged 25-44," said Ms Thanida.
Suchaya Paleewong, senior marketing manager at Shopee Thailand, agreed that the Thai online retail market has continued to see growth due to people's move towards the internet during the pandemic.
Citing the Digital 2022: July Global Statshot Report, she said the percentage of Thai internet users who bought products online each week stood at 66.5% in the first quarter, making it the largest proportion in the world.
Free shipping is the most popular reason for online purchases, the report indicated.
Thailand had an internet penetration rate of 69% in 2021, with online purchases made at least once a week, Ms Suchaya said. The penetration rate is expected to hit 78% this year.
"We have seen signs of economic recovery following the country's tourism reopening," said Ms Suchaya.
Shopee's recent restructuring and staff redundancies across the region was in line with the company's situation and strategies, she said.
"Our goal is to continue to grow the user base and sales by pushing for investment in campaigns," she added.
Shopee is Southeast Asia's leader in shopping apps, Ms Suchaya said, citing App Annie, a mobile data and analytics operator.
The top three categories for Thai Shopee users in the first half of this year were home and living, beauty and personal care, and mobile devices and gadgets.
With the 9.9 shopping festival approaching, Shopee is pursuing various marketing campaigns, including a 999-baht discount code, privileges, and a 9-hour livestream of the event.
