Thailand★Frenzy of Entrants Flooding into the Booming E-Commerce Market

Thailand's e-commerce (EC) market is heating up. The Department of Commercial Development forecasts the market size will reach 1 trillion baht (approximately 3.6 trillion yen) in 2016, 1.5 times its current size. This is expected to accelerate business entry and intensify competition for customers.

According to local media like Post Today, Mr. Pawoot, President of the Thai E-Commerce Association and CEO of local e-commerce giant Talad.com, stated that the 2014 EC market grew significantly by 30-35% year-on-year. He further projected that 2015 would see an even higher growth rate of 40%.

In Thailand, Rakuten, which acquired a majority stake in Talad in 2009, has been developing the market. Zalora, an online retailer of clothing and shoes under German capital, entered the market in 2012. Since 2014, China's largest e-commerce company, Alibaba, has also entered the market. Additionally, TV Direct, the largest local TV shopping company, has announced plans to establish a joint venture with a Taiwanese company to enter e-commerce and catalog sales. Local retailers, including department stores and supermarkets, have also successively launched online shopping businesses.

The association has set a goal to increase its membership from the current 300 companies to 50,000 by 2016. Aligning with the government's "Digital Economy" policy to spread electronic infrastructure throughout society, it plans to support small and medium-sized enterprises (SMEs) in particular to utilize e-commerce.

Chairman Pauw explained, "Many large companies, including those in the retail sector, are holding back on entering the market." For 2015 trends, he predicted an e-commerce bubble caused by increased entry from major overseas players like Singapore and China, intensifying competition. Companies are expected to step up promotional efforts, such as improving services, discount sales, and distributing gifts.