Living Domestic: Reframing marketing for Thailand’s new normal
Issarisa Khamswas
8 septiembre 2020

Source: WARC Exclusive, Spotlight Thailand, September 2020

Published on WARC – part of the Spotlight Series.

Breaking down the new value exchange that travel brands will need to grab the attention and wallets of Thai consumers changed by the impact of the COVID-19 pandemic.

  • While there is a desire for travel escapism, this is balanced with affordability with consumers looking to defer or reduce non-essential spends due to economic uncertainty.
  • The key in a COVID-19 impacted economy is to re-adjust marketing strategies on tangible value exchanges that are grounded on fiscal affordability and emotive need.

This article is part of a Spotlight series on how brands can connect better with Thai consumers as the domestic market becomes the main market in times of COVID-19.

 

How should marketeers be readjusting focus and strategy? What will it take to grab the attention and wallets of Thai consumers who have also been changed by the impact of the pandemic?

 

There are lots of mitigating factors on how best to entice Thai consumers to travel domestically.

The usual marketing strategies range from staying top of mind (Share of voice equating to share of market / SOM) and personalized media targeting wrapped in a discover Thailand message.

None of these are wrong, but the key in a Covid19 impacted economy is to re-adjust marketing strategies on tangible value exchanges that are grounded on fiscal affordability and emotive need.

Google Search trends show an uplift in ‘accommodation package’ traffic from a low in late February and early March.

 

 

While this looks promising for the local tourism sector and the economic revenue gap to fill, the reality is year on year search trends are tracking well down.

 

 

While there is a desire for travel escapism this is balanced with affordability with consumers looking to defer or reduce non-essential spends due to economic uncertainty.

Past 12 months analysis shows the significant decline in Q2 2020 planning and purchase intent. While travel interest in comparison is less impacted.

 

 

The primary hurdle (reframe) that marketers need to overcome is affordability. This paper will focus on how marketeers can reframe their strategies from traditional brand led (discovery) style messaging to more value re-appraisal call to action, through the lens of three diverse user cases.

 

1. Families grappling with a technology / screen overload

Families with children are currently the most financially aware and have to make difficult tradeoffs to balance the household budget due to the economic uncertainty from Covid19. Arguably this would eb the most difficult segment to encourage greater domestic tourism spends. The value exchange for this audience resides in another Covid19 behavior with the significant increase in screen time on both TV and across social platforms, with families (kids) spending more time at home.

 

 

Prior to Covid19 this already a primary concern from parents on balancing outdoor activates with technology.

Brands which target parents and have a holistic wellbeing position are well placed to target this mindset and encourage greater uptake of domestic travel related experiences.

Domestic travel business should shift their message to target this group based on the types of shared family experiences that are engaging for children and explicitly positioned as the healthy alternative to screen-time. From a convenience and affordability need, proximity targeting (a 2hour max drive away) and low-cost activities is key.

Simply the value exchange is fostering family experiences via positioning the great outdoors as the remedy for all the screen-time kids (and parents) have watched during Covid29 restrictions.

 

2. Re-engineering CRM loyalty programs

What to do with all those loyalty points that had been saved up to upgrade to that business class seat, or stay an extra few days in the 5-star resort in Europe?

A push to entice usual international travelers represents a new audience mindset to overcome their usual resistance to travelling domestically. There will be some who any type of travel is great, and they will be looking for the best types of Staycation packages available.

There is little in the realms of strategy aside from the promotion itself that is required to change behavior for this segment.

For the 45% of consumers who look but don’t purchase (source GWI), greater incentive and behavioral strategy is required.

Fortunately, a pre-existing behavior can be turned into domestic tourism revenue. Frequent flyers / loyalty programs have long been a powerful marketing tool for airlines to encourage incremental spend through gamification of status and rewards.

Airlines and domestic travel business should be looking to reposition these CRM programs to encourage local spends and reward customer loyalty with status upgrades and services based on customer domestic travel related spends. This goes beyond hotel rooms and flights, encompassing a broader array of local experiences with the feel-good factor of supporting local communities most impacted by the lack of international tourism.

The value exchange is represented in the continuation of status and gamification of accrued points which are currently idol. Coupled with the feel-good benefit of helping local business who are most impacted by Covid19.

 

3. Brands adjacent to domestic travel creating enhanced customer experiences.

Categories such as automotive and cosmetics represent adjacent positions to domestic travel, and while they don’t directly target these segments with the need to find new audience mindsets to get back to growth, automotive alone is forecast to be down 50% YOY. (Source: The National Thailand, June 2020)

For the automotive category the battleground is getting people to test drive vehicles, and like the travel sector new types of behaviors need to be fostered to encourage competitive advantage. For example instead of advertising the cars features and price point with the usual banner ad that says click here to test drive, the value exchange is to offer an experience / test drive where families or couples can take the car to a designated daytrip location, enjoy lunch and of course the driving experience then head back to the dealership with the desire to purchase the ‘SUV’ so they can enjoy these daytrips more often, given their usual international travel is off the table for a while.

In the case of cosmetics whose category has also been significantly impacted due to people working from home (less self-care) and masks rendering the lipstick vertical almost redundant, an increase in the perfect Instagram shots in desirable local locations opens up new types of audience segments. The change dynamic will see beauty brands working with social new influencers who span both beauty and travel to showcase the best Instagram looks by location to make friends envious of their lifestyle.

While the Thai government will be focusing on driving consumer demand through working with local tourism operators, there is an opportunity to also extend this activity to adjacent categories that can also help get to the revue target.

 

Summary

Covid19 has had a significant impact on the travel industry and traditional marketing strategies even with a huge government push won’t achieve the desired revenue goals.

The shift required is to reframe communications against tangible customer value exchanges tailored to differing audience groups. The three examples above highlight the diversity of category and audience opportunity that exists in re-positioning the benefits of domestic travel against pain points or enriched experiences which can help overcome the fiscal concerns brought about by Covid19, and ultimately help achieve the 75% target of travelling abroad revenue into local tourism receipts.

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