Ecommerce
The channel that is currently maturing
In Thailand, ecommerce is entering the middle stage of its development. Almost half (47.1%) of beauty shoppers now buy online, up from 39.5% in 2021, and a major proportion of these (70%) are repeat purchasers.
The good news is that the growth of online is incremental, with no damaging impact on offline sales: 51% of spend in the sector is coming from new demand for health and beauty products.
Online beauty is expanding beyond the millennial cohort, with buyers coming from all generations. One quarter of the channel’s value (24.5%) is contributed by millennial consumers, but this is very closely followed by baby boomers (23.3%) and the silver generation (19.4%). Despite being younger, members of Gen Alpha are spending more on beauty online (19.5%) than Gen Z (17.7%).
In terms of the platforms, pure ecommerce players are continuing to grow, but TikTok is rising fast. Shopee holds the largest chunk of market value at 33.1%, up from 29% the previous year, while TikTok has increased its share from 2% to 10.9%.
Saving money through coupons and discounts is no longer the biggest purchase motivation for consumers – it’s free delivery. This indicates that shoppers have moved on from considering lower cost as the most important factor, to seeking value instead. Free or fast delivery, or the ability to return items easily, will be more likely to predispose shoppers to buy. Customer reviews are also key, as a way of building trust.
For beauty brands, expanding their online presence will potentially provide an uplift for their entire portfolio. They should aim to:
Prioritise platforms, focusing on pure online marketplaces and TikTok
Investigate what opportunities there are with e-retailers
Encourage online purchases by offering free delivery as well as affordability.
