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Published on September 18, 2007

Thipvipa Chantapasa, the group's general manager for merchandising women's products, said the political turmoil and current unclear political picture have significantly affected its retail business, especially at The Emporium and Siam Paragon shopping complexes, because some shoppers are afraid of political demonstrations at these high-profile locations.

In addition, customers' shopping mood has deteriorated. They have the money but are disinclined to spend it.

As a result, The Mall Group earlier this year revised downwards its expected sales growth to 8-10 per cent, from the usual 10-15 per cent. The same figures also apply to the Bt10-billion cosmetics market, which has three segments - skincare, makeup and perfume - taking up 55 per cent, 25 per cent and 20 per cent of the market, respectively, she said.

About 55 per cent of cosmetic products on the market are being sold through direct-sales channels, while the rest are being sold through retail channels and supermarkets.

There has been a decrease in spending in The Mall Group's Beauty Departments, but Thipvipa said it was difficult to calculate how much spending had fallen per bill. Some shoppers have switched from their usual brands to cheaper substitutes.

She believes the change in behaviour is only temporary and that they will switch back to their favourite brands once the economy improves, because they are still concerned with their skin's health and beauty.

The company has been arranging marketing activities and promotions at its Beauty Departments in all branches of its shopping complexes and department stores each week, and the result has been 10-per-cent sales growth in the first half of the year, she said.

The latest activity is Beauty Faces Party 2007, which runs to September 26. It features the latest in makeup trends and discounts on 13 cosmetic brands. It also emphasises customer relations with current customers and 80,000 Beauty Card holders.

She said the pace of marketing would not slacken off next year.

However, she is highly confident The Mall Group will achieve its sales and growth targets, because the festive season from November to January will stimulate consumers to spend money, and their spending this year should be very high, because they have patiently controlled themselves throughout the year. Spending has, in fact, been gradually recovering since June.

The Mall Group has even set an aggressive growth target of 15-18 per cent next year, because of the weight of marketing campaigns by many brands, aimed at steering them through the current conditions.

Thipvipa expects consumers' spending will be "back on track" next year, following the December 23 election. The Mall Group's Beauty Departments will offer seven new brands this year and 10 next year.

Nitida Asawanipont, The Nation