Gloom prompts aggressive pricing plan at shops in Thailand

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MARKETING CAMPAIGNS
Gloom prompts aggressive pricing plan at shops
Kwanchai Rungfapaisarn
The Nation


In-store materials show product prices at a Big C Supercentre store. Major superstore operators have launched proactive pricing strategies to attract buyers during a period of economic difficulty, especially for grass-roots consumers.

BANGKOK: -- Supercentres and convenience-store operators have been launching aggressive pricing campaigns to stimulate shoppers' spending and the frequency of store visits during the ongoing period of economic difficulty, which resulted in same-store sales dropping by between 1 per cent and 3 per cent in the first half.

Thailand has for some time been burdened by a high level of household debt, while the current drought has also negatively impacted lower-income earners, especially farmers.

As a result, the spending power of consumers, especially at the grass roots, has been heavily diluted.

Chatrchai Tuangrattanapan, director of the Thai Retailers Association, said that supercentres and convenience stores targeted middle- to lower-income earners as their key customers, and it was these groups of consumers that had been most affected by prevailing negative economic factors, leading to a plunge in their spending power.

The association recently revealed its forecast for the retail industry, which it predicts a slowdown in full-year sales growth to just 3.2 per cent, amid no encouraging signs for the remaining five months.

The retail industry index in the first six months of the year rose only 2.8 per cent because of negative factors both inside and outside the country, which caused people to suspend many of their purchasing activities.

Compared with other retailers, supercentres were hardest hit by the decline in spending power, posting year-on-year sales growth of only 1.8 per cent in the first six months, driven mainly by new store expansion.

Meanwhile, sales of convenience stores rose by 2.8 per cent in the first half, while supermarket sales surged by 8.5 per cent over the period.

Sales increased by 3 per cent at department stores, and by 2.7 per cent at speciality shops.

"The sales growth posted by those supercentre and convenience-store operators in the first half of this year was generated by the opening of new stores over the period. Without the expansion, those operators witnessed a drop of between 1 per cent and 3 per cent on their same-store sales," Chatrchai said. Supercentres and convenience-store operators have been launching more proactive campaigns to encourage shoppers to increase their number of visits, he added.

These activities include one-day and knock-out sales campaigns, collecting redeemable stamps, cash redemption, and buy-one-get-one-free campaigns.

Merely offering price discounts might not be enough to stimulate spending, as consumers do not know the real price of a product, or it is often merely a psychological benefit, with a retailer marking up a price and then discounting from an artificially high margin, he explained.

"We have not seen signs of anything positive occurring in the second half of the year. The government has been launching plans to stimulate the economy, including infrastructure development projects, but there has been no execution so far," said the association's director.

Warunee Kitjaroenpoonsin, director of corporate affairs at Big C Supercentre, said that since the establishment of Big C in Thailand 22 years ago, the company had positioned itself as a price leader to maximise consumers' savings nationwide.

"Helping to support Thai farmers has always been Big C's top priority. We have implemented year-round savings campaigns on daily necessities and commodities to lessen the living costs of customers," she said.

"The 10-per-cent discount off fresh-food prices every Wednesday is what we do weekly, aside from exciting price-down promotions that we launch regularly. And to celebrate Big C's 22nd anniversary, Big C will slash 20-50 per cent off the prices of over 900 items in every category from August 4 to 27.

"Big C also supports local products by being a strong distribution channel for such products across the country," she explained.

Meanwhile, Tesco Lotus has launched a Bt3 billion campaign to lower prices for mother-and-baby products, as well as fresh foods.

Under the campaign, which will run for the rest of the year, the prices of 870 mother-and-baby products will be slashed by up to 20 per cent, while prices will be cut by up to 15 per cent for 150 fresh-food items.

Source: http://www.nationmultimedia.com/business/Gloom-prompts-aggressive-pricing-plan-at-shops-30265883.html


-- The Nation 2015-08-05

[SoilSpoil]

"Helping to support Thai farmers has always been Big C's top priority"

Straight out of the Pinocchio movie

[razer]

"Helping to support Thai farmers has always been Big C's top priority"

Straight out of the Pinocchio movie

I support Thai farmers by shopping at the local veggie market. Lower prices ... good quality ... and sometimes I get a freebie from my veggie lady. Better than TESCO and Big C.

[Bangkok Barry]

Price cutting, Thai-style.

[Krataiboy]

First the good news:

"Big C will slash 20-50 per cent off the prices of over 900 items in every category from August 4 to 27." - a Big C SuperCentre boss.

Now the bad news:

". . . consumers do not know the real price of a product, or it is often merely a psychological benefit, with a retailer marking up a price and then discounting from an artificially high margin." - the head honcho of the Thai Retail Association.

Don't say you weren't warned.

[manhood]

Well the ongoing story in Thailand is: most of the consumers are overindebted.

But not because the daily life is not affordable but because they need the newest car, the most expansive brands on electronics and , and and.......

So it's necessary Thais come back to the roots!!!!!!!!!!!!!!

[SoilSpoil]

"Helping to support Thai farmers has always been Big C's top priority"

Straight out of the Pinocchio movie

I support Thai farmers by shopping at the local veggie market. Lower prices ... good quality ... and sometimes I get a freebie from my veggie lady. Better than TESCO and Big C.

Make sure you know and trust your veggie lady.

http://englishnews.thaipbs.or.th/health-ministry-warns-increasing-use-formalin-vendors-fresh-markets

[farangmick]

I don't know which would be worse, a freebie from my veggie lady, who is even older than me, or a free sausage from the pork butcher man.