Siam Paragon: Optimism As Complex Opens Doors

george · December 9, 2005

SIAM PARAGON: Optimism as complex opens doors

BANGKOK: -- Giant mall hopes to draw high-end foreign visitors. The Siam Paragon Shopping Complex had its grand opening yesterday amid hopes that the new development will attract more high-end spenders to the Kingdom. Although less than half of the 350 retailers opened their shops, Kriengsak Tantiphipop, chief marketing officer of Siam Paragon Development Co Ltd – the operator of the upmarket complex – said he was delighted with the event.

“Today is a great day for everybody in the company. We started the Siam Paragon project three years ago and now the dream has become reality. We envisaged a world-class shopping phenomenon in Bangkok and today it has come to fruition,” he said.

Kriengsak said that more than 80 tenants would open their largest flagship stores in the complex, representing about 40 per cent of total retailers in the plaza.

The complex also incorporates a “Beauty Hall”. Occupying retail space of more than 5,500 square metres, the cosmetics and fragrances zone offers an outstanding selection of products from more than 100 leading brands, including La Mer, Estee Lauder, La Prairie, Givenchy, Paris Hilton, Stella McCartney and Erno Laszlo.

Iwan K C Hew, managing director of Yafriro International, an exclusive luxury watch boutique, yesterday opened its Bt50-million 212-square-metre flagship store in the complex.

“We waited for almost five years to open our flagship outlet in Bangkok and the opening of Siam Paragon has fulfilled our expectations, thanks to its prime location in the heart of Bangkok,” Hew said.

The company is the exclusive distributor of 12 luxury watch brands, including Parmigiani Fleurier, DeWitt, Bovet de LaCour, BRM, Jacob & Co, Greubel Forsey, Michel Jordi, Hautlence, Vincent Berard, HD3 and Jean Dunand. Prices range from Bt250,000 to Bt20 million.

Leading mobile-phone operator Advanced Info Service Plc (AIS), together with major telecom equipment suppliers, have jointly set up an AIS Future World centre to showcase futuristic wireless technology.

The Bt100-million centre occupies 600 square metres on the fourth floor of the complex. AIS is currently equipping the centre with hi-tech equipment in time for the official opening next Thursday.

Among the highlights at the centre is a theatre with 360-degree screen, a play zone, and a technology exhibition zone.

Oranuj Wongprecha, managing director of Pre & Prom Co Ltd, a distributor of exclusive luxury cosmetic brands, said: “I was amazed by the opening ceremony of Siam Paragon. All streets in Bangkok seem to lead to Siam Paragon.”

Pre Prom retails luxury cosmetic brands, including Philosophy, Make Up For Ever and Erno Laszlo in the Beauty Hall on Floor M. Prices range from Bt2,000 to more than Bt10,000.

Mattel Inc, the world’s leading toy-maker and manufacturer of world-famous Barbie products, revealed its latest fashion collections for kids at the complex.

Sony Thai also opened its flagship store named “Sony Style” on the second floor.

A senior Sony Thai executive said that this would be the first “Sony Style” shop in Thailand. Sony has such shops in many cities in Japan and Malaysia, as well as Hong Kong and Singapore.

“At Siam Paragon we will showcase our Sony goods ranging from Vaio computers to still and camcorder cameras, LCD television sets, PlayStation Portable, and high-definition products such as cameras and TVs.

“Sony technical experts will be at the showroom to provide information and consulting services to our customers,” he said.

Sarun Limsawadiwong, chief executive at Ideas Design Collection Co Ltd, the operator of @Home furniture store, said the company had opened a new concept of @Home furniture store on the third floor of the complex.

The company markets luxury and modern-style imported furniture brands, including Flos lighting products, Zanotta, Dema and Driaoe furniture from Italy, and Fritz Hansen furniture from Denmark.

--The Nation 2005-12-10

juggler · December 10, 2005

BANGKOK: .... The Siam Paragon Shopping Complex had its grand opening yesterday amid hopes that the new development will attract more high-end spenders to the Kingdom

I thought that in general the tourism trade here was based around people coming to thailands beaches, bkk's night life .........

Never new the grand shoping malls in BKK were a reason to visit

i get the feeling this hope is unwarranted.

Sangsom · December 10, 2005

For first class shopping -for those with plenty of money to spend - one should think of shopping cities, not just malls, like Milano, london, Paris, New York and Dusseldorf for example. A nice shopping mall in BKK just by itself does not attract one more single visitor to this country let alone the so desired big spenders!

Why do they always aim for the impossible (and unnecessary) here. Why dont they concentrate on what they get here as tourists and cater for them and let them enjoy a drink late at night for example . . .

Edited December 10, 2005 by Sangsom

snoophound · December 10, 2005

The shopping would be great if some switched on Thai fashion co started making and selling falang sized clothing.

Its frustrating going to mbk etc and not being able to buy clothes.

Its also the only reason those seedy indian tailors exist.

Seen some very nice cheap suits in Robinsons etc but all too small.

And I aint that big yet....90kg

Thank god for The chinese invasion and all their imports in Aus.

Otherwise my missus has to shop in the kids section.

BANGKOK: .... The Siam Paragon Shopping Complex had its grand opening yesterday amid hopes that the new development will attract more high-end spenders to the Kingdom

I thought that in general the tourism trade here was based around people coming to thailands beaches, bkk's night life .........

Never new the grand shoping malls in BKK were a reason to visit

i get the feeling this hope is unwarranted.

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Scott · December 10, 2005

Another Day, another mall.

Ijustwannateach · December 10, 2005

The bit about "the obscenely expensive and unnecessary new mall will bring rich tourists to Thailand and thus benefit us all" bit is necessary in an excuse-making, face-saving kind of way for the rich hi-so types for whom the mall is really being built.

"Steven"

Heng · December 10, 2005

Who cares who it attracts? The tenants are paid up in full for the next 20 years.

samran · December 10, 2005

reasonable footpath out the front though. Maybe it will set a precedent for the rest of bangkok.

But then again, it probably won't

thailien8 · December 10, 2005

Friday afternoon, opening day, was the best beautiful-people watching opportunity I've seen in over ten years in Bangkok.

solo siam · December 10, 2005

Who cares who it attracts? The tenants are paid up in full for the next 20 years.

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Yeah Right

Heng · December 11, 2005

Sold out faster than the new Chatuchak mall.

thedude · December 11, 2005

i know lots of tourists from hong kong, taiwan, singapore who come to thailand at least once a year for shopping, dining, and general relaxation. they like the variety and occassional bargains. the thai tourism industry is represented by a far broader demograpic than just sexpats and poor white beach travellers. there is also a fast growing chinese middle class market, as well as rich tourists from the middle east.

samran · December 11, 2005

i know lots of tourists from hong kong, taiwan, singapore who come to thailand at least once a year for shopping, dining, and general relaxation. they like the variety and occassional bargains. the thai tourism industry is represented by a far broader demograpic than just sexpats and poor white beach travellers. there is also a fast growing chinese middle class market, as well as rich tourists from the middle east.

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DUDE!!!!!! What are you doing mate??!!!????

You realise that you have just shattered that misguided belief that if it wasn't for our tourist friends frequeting nana, soi cowboy and pattaya that the whole thai economy would fall down around them.

snoophound · December 11, 2005

Not a lot of stuff chinese would buy in Thailand???

Some of their shopping centers are amazing.

Most of the stuff in Patunam comes from china now

i know lots of tourists from hong kong, taiwan, singapore who come to thailand at least once a year for shopping, dining, and general relaxation. they like the variety and occassional bargains. the thai tourism industry is represented by a far broader demograpic than just sexpats and poor white beach travellers. there is also a fast growing chinese middle class market, as well as rich tourists from the middle east.

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chuang · December 12, 2005

Anyone knows where is Siam Paragon Mall situated......thanks

DisainaM · December 12, 2005

Anyone knows where is Siam Paragon Mall situated......thanks

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near the Siam shopping center, where the old siam intercontinental hotel was placed.You will find a lot of good pictures of the mall

here

http://www.skyscrapercity.com/showthread.p...03&page=1&pp=20

kalaminsa · December 14, 2005

Three days after the grand opening of the 15-billion-baht Siam Paragon, Bangkok's newest luxury shopping centre was hit by a tragic accident when a 10-year-old girl fell five metres through a gap on the main floor to the floor below. Matarika Kijjapathoomsak, or ''Nong Meena'', visited Siam Paragon with her family on Monday night. While playing around a water garden on the main floor, the girl accidentally slipped through a space between a water garden and an elevator, dropping to the ground floor.

Surat Thani

The Coder · December 15, 2005

i know lots of tourists from hong kong, taiwan, singapore who come to thailand at least once a year for shopping, dining, and general relaxation. they like the variety and occassional bargains.

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In my opinion, Thailand is a poor choice for shopping for imported goods that shopping centers like this focus on. The facilities are nice, but the prices tend to be double what you pay for the identical product in your own country. And because this type stuff is so expensive to begin with, you'll never make it up by from the occasional bargain on a 100 baht thai craft.

JXXXL · December 15, 2005

i know lots of tourists from hong kong, taiwan, singapore who come to thailand at least once a year for shopping, dining, and general relaxation. they like the variety and occassional bargains.

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In my opinion, Thailand is a poor choice for shopping for imported goods that shopping centers like this focus on. The facilities are nice, but the prices tend to be double what you pay for the identical product in your own country. And because this type stuff is so expensive to begin with, you'll never make it up by from the occasional bargain on a 100 baht thai craft.

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Yes, that's correct. If you compare the prices for imported high-end retail items, Thailand is the most expensive in the region because of import duties. I have may Singaporean and Hongkie friends that come to Thailand for food and buying locally made goods. But, most of the things sold in malls like Paragon and Emporium, they would buy in their own countries.

I wish them well, but all this bullsh1t about bringing in tourists is just more of the same from Thailand.

lomatopo · December 15, 2005

I visited the new Siam Paragon mall earlier this week. I have to say that it is quite impressive. Certainly equal to anything I've seen in Singapore, Kuala Lumpur, Hong Kong. I'm not a luxury goods shopper so I am not familiar with pricing comparisons. It is unique in that there is no anchor stores per se. The central complex is one giant (un-branded) department store with hundreds of brand name shops, and many generic (appliances, furnishings, etc.) departments.

The food court is the largest I have ever seen, and the choices innumerable. There looks to be a sort of supermarket (like the one in the Emporium) too.

I did not go to the Aqarium, although the lines to get in were quite long.

There a lot very impressive automobiles on display, so a good chance to get an up close look at some Ferraris, Porsches, Bimmers, Lambos, etc. There was a Ducati racing bike that was interesting; I'd never seen a GP-like bike up close.

I think the cineplex opens in February, 2006.

I think it will be a huge attraction for visitors to Bangkok, especially those staying in Bangkok's 5-star hotels. While not the main reason they'd come to Bangkok, it certainly is a place they'll visit, and spend money. Remember these people pay the rack rate at the Four Seasons, Oriental, JW, Conrad, Westin, SGS, Hyatt, Pen, etc. so are not value shoppers.

I think the retail pricing issues are recognized as an inhibitor and there is some talk about reducing duty/excise in some/all retail outlets.

Gazza · December 15, 2005

The company is the exclusive distributor of 12 luxury watch brands, including Parmigiani Fleurier, DeWitt, Bovet de LaCour, BRM, Jacob & Co, Greubel Forsey, Michel Jordi, Hautlence, Vincent Berard, HD3 and Jean Dunand. Prices range from Bt250,000 to Bt20 million.

Gazza: Excuse me Mr Super-Rich Hi-So Thai Dude, can you tell me what time it is on your 20 million baht exclusive watch?

Mr Super-Rich Hi-So Thai Dude: errrm...Baay Song Mawng Khwaa.

Gazza: Hey! Will you look at that. My 200 baht Mickey Mouse watch also tells me that it's past 2 pm too.

Heng · December 15, 2005

And in the end, whether high end tourists patronize the mall or not, the mall is really for the 300-400,000 Bangkokians who can afford to shop their.

astral · December 15, 2005

And in the end, whether high end tourists patronize the mall or not, the mall is really for the 300-400,000 Bangkokians who can afford to shop there.

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After spending 1,040,000 baht on the Elite card, I wonder if the high rollers

have any cash left for shopping?

steveromagnino · December 15, 2005

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In my opinion, Thailand is a poor choice for shopping for imported goods that shopping centers like this focus on. The facilities are nice, but the prices tend to be double what you pay for the identical product in your own country. And because this type stuff is so expensive to begin with, you'll never make it up by from the occasional bargain on a 100 baht thai craft.

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Well, you have your opinion... but since this is MY industry I will answer several points raised by other posters, and offer my view on your comment :

- Shopping tours are extremely attractive for countries where things are not 'twice as expensive' or not even available - notably China, Japan, Korea, Middle East India, Russia. There are MANY tourists coming here to Thailand with shopping as a primary/high priority - for some shopping malls the percentage of Thai fashion sold to foreigners is 70%+ (this is the higher end stuff, Greyhound, Stretsis, etc; not crummy knock offs or mass market brands like Jaspal). For some international brands (e.g. Gucci) foreigners make up 60%+ of their market. The high spending tourists here in Thailand, for retail anyway, are not like the majority of the posters on this board in that they do not speak English, they do not have white skin, and the high spenders are probably not going to MBK LOL. Shopping is a legitimate interest for visitors to Thailand; it attracts massive spending already and Paragon will enhance that

- While China is fast developing, and certainly developments like 3 on the Bund and so on in SHanghai etc are on par with ANYTHING in the world, Chinese are discovering travel, and they also are discovering more than that.... HK retail is bursting at the seams coping with Chinese buying there - partly due to price, partly due to range, partly due to the chance to travel and shop. I see little reason for that to stop; Paragon and other malls including Central World will be looking at this continuing trend closely. Also bear in mind it is a massive country; getting to 3 on the Bund in Shanghai or Beijing could well be further for some than getting to Paragon.... plus how would they get to see a cabaret show there?!

- Some brands pursue a price leadership or regional strategy, making Thailand quite cost effective e.g. Zegna. On sale periods are also very important; this June period Thailand was on sale prior to other markets, creating cost parity with price leaders HK and Singapore. Additinoally, ranges may vary from country to country. Luxury brand buyers have to deal with both price and scacity; particularly for the Japanese buyer, coming to Thailand (or somewhere else) may be the only way to get hold of a particular bag. For non luxury buyers this concept may be difficult to comprehend; why would the brand simply not stock that in every store? That is not how marketing for luxury brands work, and restriction of supply is actually one of the key attributes for staying 'luxury'. For watches, Thailand carries only 5% tax. And it also has massive range and a lot of deal hungry retailers who will discount up to 45+% on certain watches. When the watch a collector wants is 1m baht, well they will fly to pick it up, sure.

- Thai fashion is popular in the region, and fairly well promoted in Singapore, HK and so on; to the point we DO see enough people coming from these countries to buy the stuff in sufficient quantities to be 'statistically significant'

- To be more competitive, Gaysorn and THe Mall Group have both announced duty free schemes launching in 2006, with the approval of the customs dept; will see if it gets implemented, but I'd but both schemes at above 75% likely... the maximum general price difference is about 25-35% above SIngapore and HK for brands who keep constant margin pricing; this would reduce that and create price parity

- Paragon is primarily mid market, similar to Emporium; the central piece is the dept store which targets both middle market Thais and foreigners. Emporium is positioned as luxury but really is mostly mid market as well through the dept store; marketing vs. actual - two different concepts. Therefore, its success will depend on many things, but luxury only makes up a fairly small part of their total square footage

- farang are mostly low spenders on apparel in Thailand (based on TAT stats and every mall survey and consulting job I've done here); most of the high end malls are targeting Japanese, Chinese, Koreans, SE Asian countries, Middle Easterners, Indians in about that order. Virtually none of the brands consider the entire European population + Australian + American to be high spenders; one of the only exceptions is Armani. And yes, I am taking out the Middle Easterners, who arguably could be considered farang, but are not generally done so by Thais. I assume this is because the ones who buy luxury buy the goods in their own country; and while Thailand attracts quite a decent number of luxury buying Asian customers it tends to attract western mid-lower level customers; fewer of whom are luxury brand buyers. And of course the growth in luxury is in Asia, ME, India, and that isn't only because of more stores opening.... Therefore, sizing issue is less relevant, and certainly anyone who shops in MBK is most certainly probably not going to be very interested in what goes on at Paragon! MBK is cheap knock offs and sport apparel stuff; based on what I see the majority of tourist westerners wearing here, I'd say that MBK is about right for most western tourists. The issue of sizing has been raised; for some Thai brands they claim (for whatever reason) that if cut bigger (particularly women's stuff) the shape is wrong, so they are happy to stay smaller size only. That's up to them. I can think of several women's brands like Pucci that only suit women with decent figures - they also choose to offer SOME larger sizes up to maybe a size 16 I'd guess; luxury doesn't mean it needs to fit everyone.... however I totally agree for mass market brands...let's hope the dept store figures that out if they haven't already

- Having been there I would say that Paragon is definitely not yet attracting the luxury buyers - it looked extremely mass on the opening period with lots of gawkers and not too many shoppers; but anyway let's bear in mind that there is a lot of foreign money invested in the project too (via the brands); a lot of thought has gone into this project, and as Heng notes, the return for the investors of the development itself is almost assured with long term leases...hardly stupid

- Regarding Thai crafts; same as MBK there are the 100 baht elephants and then there is the nice furniture, silks, and so on which are 10,000b etc etc.... can't get by in a mall selling the same stuff as Jatujact; so expect to see a few steps above that I think

- Incidentally the local Thai market? There are 1m people in BKK with household incomes of about 70,000b or more a month; Paragon won't even be aiming that high.... there are certainly lots of locals going to be going there; my guess is they will be pulled mostly from the other high traffic malls (it takes a lot of people to get 100,000 visitors a day) - Siam Discovery, Siam Square, Emporium, Central World could be quite quiet for a while......

And regarding watches....

- Gazza: smart hi so Thai dude might be running circles around you; the true watch investors can maintain surprisingly good returns on their hobby; I suspect your 200 baht watch will always be around 200 baht. No question though, they both do the same job...same same Porsche vs. Lada.. although actually most hand wound movements stop spinning if you don't wind them up - 8 days is the best I think with a pannarai...so not sure whether your 200b watch is the porsche or the lada?!!

Sunbelt Asia · December 15, 2005

Thanks for your comments.

By the way, the first few days our customers at the Siam Paragon have been 45% Thai, 35% Hong Kong, Chinese, Koreans, Japanese,Singaporean and only 20% Farang. Versus on Lower Sukhumvit it is 90% Farang, 5% Thai and 5% Japanese.

Different Worlds!

www.sunbeltasia.com

steveromagnino · December 15, 2005

Thanks for your comments.
By the way, the first few days our customers at the Siam Paragon have been 45% Thai, 35% Hong Kong, Chinese, Koreans, Japanese,Singaporean and only 20% Farang. Versus on Lower Sukhumvit it is 90% Farang, 5% Thai and 5% Japanese.

Different Worlds!

www.sunbeltasia.com

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Absolutely! Interesting details.....

I'd further guess that your product (guessing here....Subway?) already has a bit of a western skew, since for the most part my Thai friends aren't so keen on bread?

Do you have bi-lingual speakers? Do you do hallal?

marquess · December 15, 2005