Thai recipe for haircare growth

With greater affluence fuelling Thai middle class aspirations, sectors such as haircare are feeling the benefit – and Unilever and P&G have been quick to get in on the act. By David Kilburn

New marketing wars are being fought for the hearts, heads and palates of Thailand’s new affluent consumers. Rapid economic growth has catapulted millions of urban dwellers into a modern middle class keen for an international lifestyle and the products that go with it.

Take haircare – a market that barely existed in Thailand ten years ago. Today, virtually all Bangkok women use both a shampoo and conditioner. Unilever (Sunsilk, Dimension, Clinic, Lux Shampoo, Organic) and Procter & Gamble (Pantene, Rejoice, Vidal Sassoon) dominate the market, accounting for about a 70 per cent share. Colgate and Japan’s Kao Corporation share another 15 per cent.

But the market is far from sewn up by major brands. According to a study by the US embassy in Bangkok, there are good opportunities to sell imported shampoos and haircare products, even at twice the price of regular brands on sale in the UK.

Smart Thai women are snapping up brands imported directly from the US, France, Japan, Indonesia, and the rest of Asia. Smugglers of Golden Triangle fame have diversified their portfolios and are now bringing in increasing quantities of innocuous haircare products from nearby Singapore and Malaysia.

Marketing mavens say metropolitan Thais are more eager to try new products than many other nationalities. Additionally, young women share the belief that they should change shampoo brands regularly if they want their hair to look its best. And so the demand for brands accelerates quicker than products can be launched. For Unilever, the country has become one of its key centres for hair product development. Unilever’s Organic shampoo, originally developed in France, was launched in Thailand before rolling out worldwide.

According to the embassy study, imported brands accounted for about 15 per cent of the market in 1996, and this is growing. When tariffs on haircare products are halved to 20 per cent later this year, imports are expected to increase to 25 per cent of the market. The embassy reckons US brands dominate imports with a 27 per cent share, worth $11.1m (7.3m) in 1995.

Over the past two years or so, the conservative appearance of many Thais has been transformed by radical new looks. Increasing numbers of fashion-conscious Thais are colouring their hair for reasons other than simply to hide the white or grey. A palette of colours from brown to blonde to orange is not unknown, with both Thai men and women now highlighting their hair. By 1999, imports of hair colour products are expected to increase to 17 per cent of the market, worth $18.3m, according to the study.

And what happens in Thailand has an influence on consumer trends in neighbouring countries. Though generally poorer than urban Thais, the people of Laos, Cambodia, Myanmar and Vietnam are buying more consumer goods and looking to Thailand as a source for these and other lifestyle ideas.

Recommended

P5ersil targets anoraks with on-pack CDs

Marketing Week

Lever Brothers is making a bizarre 3m leap into the technological age by developing and promoting a pan-European Website and CD-Rom for its top washing detergent brand, Persil. The company says the CD-Rom will be given away on a freefone number and could appear on packs. It includes a children’s game and “a history of […]

Top marks for school article

Marketing Week

Your article “Class facts” (MW March 21) on marketing in education made interesting reading and certainly flagged up the fact that many companies appear to be undervaluing this important communications channel. Your figures identify a gap between expectation and perceived achievement (75 per cent cited brand building as an objective and only 49 per cent […]

Own-lalbel fags go up in smoke

Marketing Week

Brand manufacturers frustrated by the delphic utterances of the judge in the Penguin v Puffin case will be edified that they are winning the battle against supermarket own-brands hands down in at least one sector. A 700m one, too. That handsome figure represents the supermarkets’ own-label share of the 12bn UK tobacco market. Not so […]

Comments

    Leave a comment