Growth in Smartphone Shipments in Thailand Driven by Operators' Stronger Vendor Ties

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The smartphone market in Thailand recorded 5.3 million shipments in 2017Q3, growing 9.9% quarter over quarter (QoQ) and 26.7% year over year (YoY). Smartphone players have shifted consumers’ preference for higher-spec handsets from the low-end ones that were heavily promoted by the operators’ two-year campaign of shifting subscribers from 2G to 3G followed by growing 4G adoption. 2G subscriber base now accounts for less than 1% nationwide.

“Smartphone companies wasted no time in establishing themselves to take up the space left by the operators’ house-branded smartphones. As operators sought new ways to retain their subscriber base, partnerships between smartphone vendors and operators have increased. As such, smartphone shipments (excluding operator house-brands) through operator channels have more than doubled over the same period last year,” says Nutchanon Boonsorn, Market Analyst, IDC Thailand.

2017Q3 key highlights of Thailand’s smartphone market include:

• Global and Chinese brands ramp up activities. Similar to last quarter, ultra-low-end (<THB3,300) and low-end (THB3,300<THB6,600) smartphones collectively made up approximately 60% of Thailand’s smartphone market while midrange smartphones (THB 6,600<THB 13,000) made up 33% as this segment continued to see growth spurred by replacement demand. The top 4 players — Samsung, OPPO, Huawei, and vivo — sustained their aggressive marketing efforts while letting their more affordable low-end and midrange models drive up their volumes. Meanwhile, True continued to bundle its smartphones with call/data plans. New players HMD (Nokia) and Xiaomi also entered the market, both playing mainly in the low-end space.
• Operators increase emphasis on services and customer experience. Operators continued to level up their own unique services and offerings to stay competitive and relevant in the market. Apart from the usual smartphones, tablets, and wearables, they have continued to expand their range of hardware, from smart home IoT (Internet of Things) to mini humanoid robots. Physical outlets have also been upgraded to provide better customer service experience, operating as device retail outlets, cafés, meeting zones, and virtual reality (VR) content experience zones, to name a few.
• Increased marketing activities prior to royal cremation ceremony. Marketing activities were ramped up in 2017Q3 in anticipation of a slower market in early 2017Q4 due to the cremation ceremony of the late King, when entertainment activities would be reduced as required by local law.

“We expect the smartphone market to continue growing, driven by replacement demand especially in the midrange space with demand spurred by trending features such as thin bezels, 18:9 aspect ratio screens, dual cameras and on-device Artificial Intelligence (AI). Moreover, the government's income tax deduction measure allowing consumers to buy goods and services worth up to THB 15,000 (from November 11 to December 3) will further stimulate the growth of the smartphone market in the short term,” ends Boonsorn.

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