Voice of Thai consumers from INTAGE (Thailand) Co., Ltd.
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1 Voice of Thai consumers from INTAGE (Thailand) Co., Ltd. Issue #018 This is our regular issue of, a periodical newsletter provided to the customers and partners of INTAGE (Thailand), Co., Ltd. As an Intelligence Provider, we continue our commitment to inspire our valued clients with information that is useful for decision making of business communities. For several decades, Fashion has been delivered through traditional media such as print magazines, print advertisements, billboards, or special events like a fashion show on a runway - which is a holy ritual tradition that cannot be missed for haute-couture fashion s such as Chanel or Yves Saint Laurent. However, in today's digital era where consumers tend to consume modern media more than traditional ones, it is not surprising to see that, online media nowadays has inevitably become one of the most important medium for fashion to distribute information about their s and products to consumers. Traditional media consequently have to adjust themselves to the digital trend; for instance, by offering online version or introducing an application for smart phones and tablets, as to suit the current lifestyles of the consumers. It also includes uploading Runway Fashion Show to a website like Elle Fashion Week, to increase chances for s to get access to people who do not watch, or watch less television. Consumption behaviour for fashion product also develops together with media consumption. Majority of people tend to use e-commerce or m-commerce at an increasing pace.1 Even in Thailand, the number of people who spend on fashion items via e-commerce is higher than the previous years.2 E-commerce, as a consequence, seems to be a Must-have service for most shops as one additional sale channel that is more convenient to their consumers' digital lifestyle. One example is ASOS fashion website, one of the top 10 online shopping sites3, that includes prestige s popular among western teenagers. Even in Thailand, several newly established fashion shops seem to choose e-commerce service as their main sales channel, be it the ones that sell a low-priced product at 199 Baht or prestige products at over tens of thousands Baht. This phenomenon may unavoidably make us believe that online shopping era has come to extinguish all traditional fashion shops including prestige ones at a department store. But, would that be real? Would these shops have to close down and transform themselves to be e-tailers? Page 1 Copyright INTAGE (Thailand)
2 INTAGE (Thailand) Co., Ltd. has therefore conducted a quantitative study among 150 male and female consumers, aged 18-40, who have experienced purchase of fashion (clothes, accessories, etc.) online, aiming to understand their behaviour. The result can be described as below: Online Media as a Source of Information Overall, most consumers (64%) utilize online media to search for fashion-related information. The most popular channels are social media of celebrities, movie stars or friends, especially among female respondents, accounting for as high as 72%. Others are social media created by fashion s (51%) and websites of s (43%). In the meantime, the survey also reveals that the majority of Thai people still choose to receive information from traditional media; that is, they go to observe fashion products and trends at actual shops and stores (popularity at 71%), read fashion magazines (59%), and also watch TV advertisements (45%). As for online media such as review blogs of products or s, online magazines, pre-order websites, or websites that offer deals, are still popular only among limited group. Media type as a source of information for fashion products Fashion shops at department stores or shopping complexes Fashion magazines Social media created by a Brand websites Online Fashion Magazines TV advertisement Websites offering promotional deals Others 7% 5% 7% 3% 3% 1% 1% 10% 2% 2% 30% 29% 39% 43% 51% 59% 72% 71% Most frequent source Utilized source It is not necessary that all online media can become an efficient platform for fashion products. We need to understand real behaviour of consumers when using each online medium, how they utilize it and for which piece of information. Furthermore, consumers use different online media to serve different purposes. For instance: Main objectives to visit website of s are: - To check new products (60%) - To buy a product at a shop at later date (51%) - To check product price (40%) Main objectives to visit pre-order websites are: - To check product price only (64%) - To buy fashion product online (53%) Page 2
3 And, if they would like to be updated on new fashion trends, they tend to visit social media of celebrities, stars or friends (59%). This proves to be another trendy channel for fashion updates at present. Purposes of Online Media Usage Official Brand websites Websites offering promotional deals Social media created by a Compare product price Follow trends of stars/celebrities Browse and purchase products online Browse products and purchase later Update new products Update new trends It is apparent that the main purpose of online media usage of Thai consumers is not to purchase product, but rather to seek for information about products or trends. It is therefore interesting to find out if e-commerce channel for fashion products is really necessary for Thai consumers." Expected kinds of information and functions For Prestige s, Thai or foreign alike, consumers tend to use social media of celebrities, stars, or friends to get their updates on new fashion trends more than other channels. At the same time, they visit a website of a particular in order to seek information on product availability, new products or new promotions. This habit is different from that of Masstige s (middle-level s for mass consumers) whose online channel is less expected. Levels of fashion s Type of Information Expected from Online Media Official Brand websites Social media created by a News about sale promotion event of a News about entertaining event of a News about CSR activities Review of products or s Latest fashion trend Current promotions Information on new products Information on available products Page 3
4 Overall, there are certain functions that deem necessary in all online channels, i.e. 1) Product catalogue 2) Distribution or purchase channels, including e-commerce, as well as information about locations of shops and branches in detail. 3) Promotional activities e.g. prize competition, discount, point exchange Functions Expected from Online Channels Official Brand websites Social media created by a Product catalogue Distribution or purchase channel News about Promotional activities Online communities Trading channel among users Others Since consumer behaviour in each online media varies according to the type of fashion s, information and functions consumers expect also vary from one media to another." Online platforms as an e-tailer Despite the fact that Thai people tend to use online media rather than offline and want online purchase to be more widespread, their actual online behaviour towards Prestige s does not reflect that fact. Online purchase for these s has not become so popular yet. The survey reveals that, in terms of information search and purchase via internet, we can group consumer behaviours in to 3 categories: 1) Browsing and buying online 2) Browsing online but buying offline 3) Browsing online but not buying anywhere If a fashion product has no ing, be it Thai or foreign, online is the most convenient way to browse and buy. If a fashion product holds a popular, online is the most convenient channel to search for information, but not to buy. People tend to visit brick-and-mortar shops (ordinary shop) later, especially for mid-prestige up to hi-end s, with no regards to the product's nationality. Page 4
5 On the other hand, if a fashion product is a Masstige, be it Thai or foreign, consumers tend not to buy online. They also use online search less than other categories. Behaviour of Online Information Search by Brand Types Browse and buy online Browse online but buy offline Browse online but never buy Never search online 34% 30% 14% 37% 31% 45% 27% 18% 31% 52% 46% 21% 33% 13% 27% 41% 34% 41% 35% 38% 13% 6% 5% Foreign product with no Thai product with no high prestige masstige high prestige Hi-end mid prestige mid prestige masstige The reason why most people prefer buying premium s at a brick-and-mortar shop over online channel is not because online purchase is insecure, not convenient or complicated, but because of the followings: Consumers perceive the product as high-involvement. They do not want to buy unless they have tried it on, or at least touch it to know the quality by themselves. Secondly, consumers are not sure whether the product is real or has a defect if buying online. Additionally, consumers feel it convenient to access to shopping facilities in order to buy fashion products that are available anywhere. As a consequence, although online media is a hot trend whose popularity tend to keep increasing by day, Thai consumers do not purchase online when it comes to fashion products, especially Prestige ones. Online is used as one main channel for product information search. Its role is therefore limited only to be a communication or promotional tool as to give content that consumers require. The latest output concluded from this study proves to us the importance of a brick-and-mortar shop that, no matter what, it helps highlight the image and acts as a place where consumers can gain direct experience of the through interaction with the sale staff and personal touch with the actual product. For maximum efficiency, a fashion owner needs to know how to adopt online media to be most suitable for their and communicate with their consumers properly. All in all, we should not be lured by a trend, but be smart enough to use the trend to build up even more success to our business. Page 5
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