SUNDAY, April 14, 2024

Seven social trends shaping Thai business in 2023

Seven social trends shaping Thai business in 2023

As businesses face the reality of a global economic slowdown, I am increasingly optimistic about Thailand's path forward in 2023, as local companies remain durable and resilient – focusing on performance following three years of tremendous transformation.

Thailand's Ministry of Finance recently forecast up to 3.8% economic growth in 2023, bolstered by an improved tourism sector and domestic demand. This improvement will also be seen in digital spaces, with nearly 60% of worldwide social users set to be based in Asia-Pacific this year.

With an increasingly competitive digital landscape, the potential to connect with customers where they are is crucial; and it will be platforms, creators, friends, and families that drive the discovery and evaluation of local brand products and services.

Businesses that effectively leverage technology, adapt to change, and focus on performance will be the most likely to gain an edge during times of economic downturn, so here are some of the most promising social trends that businesses must consider for their growth in 2023.

1. Artificial Intelligence: Generative AI had a breakthrough moment at the end of last year. AI is becoming more mainstream as the technology continues to advance and its capabilities expand. As a result, a wider range of products and services are now incorporating AI, such as smart home devices, self-driving cars, and virtual assistants. The use of AI to analyze, organize, access, and provide advisory services based on a range of unstructured information is only going to grow. In Apac, IDC (International Data Corporation) spending on AI systems is expected to rise from $17.6 billion in 2022 to around $32 billion in 2025. 

Businesses are looking to automation to improve customer experience and save time; as such, Meta has introduced new tools like Meta Advantage to help every advertiser leverage the power of AI and automation — maximizing the performance of their ad spend – and Advantage+ shopping campaigns that help advertisers eliminate the manual steps of ad creation, and automates up to 150 creative combinations at once.

2. Business Messaging: We're living in a messaging-first world. Globally, one billion people message a business each week on WhatsApp, Messenger and Instagram DirectDMing brands, browsing product catalogues, asking for support, or interacting with stories – with Click-to-Messenger Ad spend now standing at US$10 billion annually. In Apac, business messaging is growing across Australia, Indonesia, Korea, the Philippines, Taiwan, Thailand, and Vietnam. Moreover, locally, we see how business messaging unlocks new opportunities for businesses and customers, with a recent survey showing 76% of Thais prefer messaging with a business, while 78% of people in Thailand say they already message a business at least once a week. 

3. Cross-Border Shopping: The world is getting smaller as technology makes it easier to shop from anywhere. People are so comfortable purchasing from other countries that cross-border e-commerce growth is now outpacing domestic e-commerce growth by 5 points. By 2026, it's estimated that the global cross-border e-commerce market will be worth USD 2.2 trillion – a compound annual growth rate of 17% since 2019. Meta worked with YouGov to survey over 16,000 shoppers across eight countries, and over half of those surveyed said they had already bought a product sold by a business in a foreign country, while 82% said they're open to doing so – further highlighting the future potential of cross-border opportunities. Social media also plays an exceedingly important role in the discovery, with 58% of cross-border shoppers saying they found products from foreign businesses through these channels. 

4. Virtual and Augmented Reality: Over the last year, businesses have embraced AR/VR to enhance the customer experience and are building creative and immersive ways for consumers to connect with their brands. According to the IDC, spending on AR/VR in Apac will grow with a compounded annual growth rate of 42.4% (2021-26) and reach $16.6 billion by 2026. AR ads enable businesses to deepen their connection with customers and improve the overall ad experience for people on Meta platforms. There is also a robust community of AR creators in Thailand, with the country being identified as Top 10 globally by the total number of active Spark AR creators in the last quarter. 

5. Creators: Creators are the future: 51% of surveyed cross-border shoppers cited creators as a top source of information to discover and evaluate products. This provides an opportunity for brands to work with creators to co-create a brand narrative. At the end of last year, Meta launched 'Creators of Tomorrow', a global campaign to spotlight creators who are innovating and building communities with diverse voices. According to our recent Instagram Trend Report Thailand, Thais – and especially younger generations such as Gen Z – prioritize meaningful connections with the people they follow, such as influencers. For brands, there has never been a better time to explore collabs and co-creations with diverse creators or even complementary brands. As they say, if you want to go fast, go alone, but if you want to go far, go together.

6. Online Shopping: Consumers are returning to physical stores, but the digital shopping habits formed during the pandemic continue to be relevant. For Gen X and Baby Boomers, mobile as a discovery channel continues to grow. A Nielsen study showed that 85% of Apac shoppers will continue to make purchases online, with Southeast Asian shoppers showing the highest online shopping intent at over 60%.

Social commerce is the fastest-growing sales channel, with 62% of online shoppers in Apac citing it as their preferred channel. With the rise of social commerce, Gen Z shoppers have recently become a driving force for shopping transformation. In Thailand, Gen Zs utilize both online and in-store touch points interchangeably – over 54% of Thai Gen Z shoppers have ordered an item online and had it delivered to or picked up at a store – with smartphones being their most important shopping tool. 

7. Short-form Video: Video continues its blistering growth across the internet and on Meta platforms. This includes Reels, which continues to grow quickly across our apps – both in production and consumption. Reels is Meta's fastest-growing content format by far, counting for 20% of time spent on Instagram. Daily Reels plays across Facebook and Instagram have doubled from 140 billion over the past year. Particularly in Apac, video is becoming the primary way that people use our products and express themselves.

So how should businesses respond? Determine your objectives, whether it is to build a brand or drive more immersive shopping experiences, and go from there. It is important to tell your brand story through video in all formats and lengths to achieve outcomes – from brand building to discovery. The upside is that businesses now have numerous ways to connect with people and build their brand through a variety of social, online, immersive, and conversational experiences. It is an exciting space to explore and as we like to say at Meta, Begin Anywhere – these new ways of doing business and connecting with consumers are only going to grow.

 By Prae Dumrongmongcolgul, Country Director of Facebook Thailand, Meta