2023-10-09-莱坊-Bangkok_Retail_Market_Mid-2023_7页_2mb

Bangkok Retail Market Summary (Mid-Year 2023)

Core Content Overview

The Bangkok retail market has shown a significant recovery as of mid-2023, driven primarily by the resurgence of foreign tourism. The market has adapted to post-pandemic conditions through various strategies, including technological integration, flexible rental models, and the development of new retail formats.

Key Trends and Developments

Foreign Tourism Recovery

• Foreign arrivals in June 2023: 12.9 million, expected to reach 28.5 million by year-end, which is about 71% of pre-pandemic levels (2019).
• Top 5 foreign markets (Jan-May 2023):
  1. Malaysia: 2,104,714
  2. China: 1,443,119
  3. Russia: 791,574
  4. South Korea: 763,079
  5. India: 761,463

Retail Market Recovery

• Total revenue for 1H 2023: Increased by approximately 20% compared to the previous year.
• Revenue recovery: Leading shopping centers have recovered 50-60% of pre-Covid revenue, with overall profitability reaching 76%.
• Expected recovery by end of 2023: Close to 2019 levels.

Retailer Adaptations

• Rental adjustments: In 1H 2023, rental discounts were canceled or reduced to 0-4% as visitor numbers returned to 80% of pre-Covid levels.
• Operational changes:
  • Stores were renovated to welcome the New Year festival.
  • Use of robots and vending machines increased in restaurants.
  • Marketing activities intensified, especially during festivals.
  • Mobile applications were accelerated, with gamification and coin rewards used to boost sales.
• New market strategies:
  • Recruitment of new stores with growth potential.
  • Diversification into small grocery businesses.
  • Conversion of vacant spaces into flea markets to increase rental and parking income.
• Segment recovery:
  • Beauty, health, and wellness sectors showed strong tenant return.
  • Restaurant segments, including shabu and grilled pork, also experienced recovery.

Retail Property Supply

• Total supply in Bangkok and surrounding areas: Approximately 7.6 million square meters.
• New project openings: Minimal due to ongoing economic and tourism recovery.
• Major developments under construction: One Bangkok, Bangkok Mall, Dusit Central Park, and The EmSphere.

Retail Property Categories

Technology in Retail

• Omnichannel integration: Combines online and offline experiences for seamless shopping.
• ESG focus: Retailers emphasize environmental, social, and governance practices for transparency and sustainability.
• Personalization: Brands use customer data analytics to enhance the shopping journey.
• Immersive shopping: AR and VR technologies are used to create engaging experiences, such as virtual dressing rooms.
• Cashless and contactless: Customers prefer flexible and efficient payment methods, supported by AI and analytics for automated inventory management.

Conclusion

Bangkok's retail market has demonstrated resilience and adaptability post-pandemic, with a strong recovery in both foreign tourism and retail operations. Retailers have embraced technology and diversified their strategies to meet changing consumer behaviors and market demands, positioning the sector for continued growth in the coming months.