Mindshare predicts growth in spending to ease in 2023

Ad spending in Thailand is expected to record slower growth this year, weighed down by brands’ cost controls amid economic challenges, says Mindshare Thailand, a marketing and media network.

Total ad spending surged 9% to 118 billion baht in 2022, but is expected to grow 5% to 124 billion this year, said Bhidak Indraduta, managing director of Mindshare.

Advertisers and manufacturers are expected to use cost control measures this year, he said.

“With the rise of material and delivery costs and being unable to increase product prices, companies need to control other costs, including advertising,” said Mr Bhidak.

In 2022, the largest share of media spending went to TV with 62.4 billion baht (a 52% share), followed by digital channels with 26.6 billion baht (a 22.5% share) and outdoor advertising with 7.8 billion baht (a 6.6% share).

Ad spending on TV is expected to drop to 61.5 billion baht (a 49.5% share) this year.

Ad spending through outdoor media is estimated to surge to 10 billion baht (an 8.1% share) while the share of digital media is set to slightly drop to 27.7 billion baht (a 22.3% share).

Ad spending through in-store space is expected to see the highest growth (40.2%) this year, followed by transit (29.1%) and outdoor media (27.5%), as life returns to normal post-pandemic.

Mr Bhidak pointed out that brands have returned to spend money to build brand awareness through formats that can reach mass users, including TV, digital and out of home.

The share of ad spending for TV is not expected to drop much as it is still a powerful tool to boost brand awareness, he said.

Offline media will continue to be relevant as people spend time outside and it will serve in terms of awareness among mass users.

According to Mindshare, most major fast moving consumer goods (FMCG) providers cut their ad spend to control costs in 2022.

Mr Bhidak remains positive about the economic outlook this year with the estimated growth of 3-4% buoyed by the tourism recovery and the rise of the consumer index.

The company also highlighted six key consumer trends for 2023.

The first trend involves brands gearing up to show social responsibility, green, diversity and equality. “This is more important than ever,” he said.

The second pertains to the rise of consumer influencers. This means consumers have faith in influencers and that could be a powerful force for influencer marketing.

The third involves the development of apps into super-apps. Super-apps will become a new sales channel for brands with more demand in terms of delivery and customer base.

The fourth concerns the rise of “social search”. Users will tend to search for information through social media platforms, including e-marketplaces, not just Google.

The fifth trend involves video engagement. Video content continues to dominate people’s interest, such as those viewed via TikTok, YouTube Shorts, Facebook Shorts and IG Reels.

The sixth trend pertaining to omnichannel sales and social commerce will be everywhere.

“Omnichannel will be an effective way for brands to sell their products, mainly through social and live commerce,” said Mr Bhidak.

‘‘ Omnichannel will be an effective way for brands to sell their products mainly through social and live commerce. BHIDAK INDRADUTA Managing director, Mindshare