An increase in the number of Chinese tourists in recent years has tremendously benefited Thai retailers, especially those offering uniquely Thai and value products.

Tourist arrivals to Thailand have continued to set records due to the country's ability to effectively spur growth in the tourism sector. Additionally, the baht is relatively cheap compared to the currencies of developed countries, which makes it more affordable for tourists.

Thailand has long been renowned as a major shopping destination. Bangkok's dense shopping district is comprised of an array of malls within short travel distances of each other and offer easy access to public transportation, making it convenient for shoppers.

Of all tourists, the Chinese are the largest group, accounting for about 30% each year. Chinese spending on Thai products, ranging from fashion to electronics, has undoubtedly been an important part of the Thai economy.

According to a Tourism Authority of Thailand (TAT) survey, Chinese tourists allocate 41% of their travelling budget to shopping and 4% to food. The rest goes to transportation, entertainment, tour-guide fees and accommodations. Of the budget allocated to shopping, 63% of Chinese shoppers intend to spend on food and snacks, 62% on gifts and souvenirs, 51% on clothing, and 49% on cosmetics and personal-care items.

Buying souvenirs and gifts for friends and families when travelling overseas is a Chinese tradition. Many Chinese tourists buy souvenirs and gifts inside supermarkets in shopping malls as they usually offer more varieties.

In terms of accessibility, some branches of 7-Eleven in major tourist destinations provide a product shelf specifically for Chinese customers. Dried fruits (durian, mango, and mangosteen), fried seaweed, skin cream, and other Thai medicinal and herbal products are particularly popular among Chinese shoppers.

Mid-range fashion brands have also become increasingly popular among Chinese tourists, especially Thai fashion brands with a presence in the mainland.

For example, the Thai bag retailer Naraya is popular among Chinese tourists. The handmade products' emphasis on affordability is a unique selling point.

Genuine luxury products are also benefiting from the trend as Chinese tourists can get value-added tax refunds, which make it more attractive to tourists. 

As well, Thai cosmetic products are popular among the Chinese. Beauty Buffet, a leading Thai cosmetic company, said aside from its administration strategy, the reason for its significant growth over the years was growing interest and positive feedback from foreigners, particularly those from China, Hong Kong, and the Middle East.

An important part of a tourist's cultural experience in Thailand is food and beverages, with seafood and traditional Thai restaurants being the most popular.

Although Chinese tourists currently spend 4% of their budget on food, it is a growing sector as the government is trying to promote Thailand as a food destination.

Many restaurants have added Chinese-language menus while some have gone so far as hiring Chinese-speaking staff to take care of Chinese customers.

King Power, the leading duty-free chain, has especially reaped the benefits from the boom in Chinese tourists over the past few years. The number of Chinese tourists has grown to become a large portion of its customer base, so much so that it is renovating retail space to offer uniquely Thai-branded products and herbal goods in response to the high demand.

With TAT projecting the number of Chinese tourists will reach 9.5 million in 2017, an increase of 9% year-on-year, there is still much room for growth for retailers in Thailand seeking to take advantage of the expanding customer demographics.

Notably, the products or services of retailers who benefit the most from Chinese spending share certain attributes. They typically are niche products that highlight Thai culture. They offer good quality at affordable prices, giving tourists a sense of increased value for money.

Lastly, the availability of such products or services is usually limited in China. These types of products create unique tourist-oriented products as they comprise of a level of Thai authenticity which cannot be easily found in their home country.

Chotika Tungsirisurp is associate director, and Warunchai Athigapanich is an analyst at CBRE Research and Consulting, CBRE Thailand. They can be reached at bangkok@cbre.co.th Facebook: CBRE.Thailand Twitter: @CBREThailand LinkedIn: CBRE Thailand website: www.cbre.co.th