The Thai government is counting on the hit TV satire to attract more visitors willing to spend big on the right items.
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Series 3 of HBO’s acclaimed satirical drama series, The White Lotus, is being produced in Thailand this year, after successful seasons shot in Hawaii and Sicily. The Thai Government hopes that the attention it garners will ignite a surge in big-spending visitors. The series will hit the screens in 2025 but already the retail, hospitality and sundry other tourism business owners are licking their chops. Should they be careful what they wish for?
The White Lotus is a social satire in which the excesses of affluent tourists play out in magnificent resorts plonked down in magnificent natural settings that are populated by a generally far less privileged socioeconomic class. The New York Times reported that the Thai Government helped out financially with the campaign to bring the series home, winning over some stiff competition from Japan, although the exact details of any financial sweeteners are unclear. The assumption that the series will draw positive attention to the country as a tourist destination is likely to be borne out: Reportedly, there was a surge in bookings at the lush resorts of Maui and Sicily after The White Lotus filmed in those locations. In its travel trends report called Unpack 24, e-booking company Expedia told of a 300 per cent increase in travel demand for Hawaii and Sicily following the screenings. Clearly, media now plays a bigger role than ever in the choice of travel destinations.
What this would mean for retailers across Thailand is difficult to quantify but the impact is likely to be positive across the board, although in a country that in pre-Covid times derived a massive estimated 12 per cent of its gross domestic product from international tourists, the environmental impacts and stresses on infrastructure wrought by tourism are already evident.
Recent Thai governments have made no secret of their desire to attract a ‘better quality’ or ‘high value’ kind of tourist. This does not mean the person is better educated, or morally upstanding (in fact, it doesn’t rule out the possibility of an out-and-out nincompoop, as some of the characters in The White Lotus exemplify), rather that they bring lots of money and spend it at the ‘right’ places. What are examples of the right places? The high-end resorts and hotels in Samui, Phuket and Bangkok, and the capital’s glittering malls, like Emporium and Siam Paragon are examples of places that would fit the bill quite nicely.
Anutin Charnvirakul, who was deputy Prime Minister in the previous government and now the current one, said as far back as mid-2022 that, “We cannot let people come to Thailand and say ‘because it’s cheap.’ ” In case the point wasn’t clear enough, he went on: “Sell premium. The more expensive, the more customers. Otherwise, Louis Vuitton wouldn’t have any sales.” Anutin’s grasp of luxury retail is precarious, overlooking the fact that premium products are by definition higher-quality ones with superior specifications and workmanship, resulting in higher production costs and typically commanding premium prices by their very nature. His misconception that things attract customers just because they are expensive hits on a problem that Thailand has in attracting the kinds of tourists he wants: a lot of the tourism infrastructure, environmental quality and service levels outside the luxury resorts and hotels is poor. You can’t sell at a high price if you don’t have a higher-quality product, and some of the product in Anutin’s country that well-oiled tourists will expect to meet such a standard is wanting.
That aside, it isn’t clear that The White Lotus will bring the ‘better’ kind of tourist but it will certainly boost the overall numbers. And any benefit to retail from the higher numbers will be much more broad-based than just more spending on five-star hotel rooms and luxury boutiques.
Central Retail is an exceptionally good bellwether since it operates mid-market global and domestic brands all around Thailand and many of them trade in the malls of its sibling company Central Pattana. The merchandise, attended by ample food and beverage establishments, spans almost every conceivable retail category. Since it operates in tourist and non-tourist locations, Central is easily able to measure the relative impact of a rise in visitor numbers on its sales. And in the post-Covid period, Central has been reporting soaring sales at its locations exposed to international tourism, during a period of sluggish performance in locations with a primarily domestic consumer. Standouts include the key provinces of Chiang Mai, Chonburi, Phuket and Suratthani. The latter two are believed to be shooting locations for The White Lotus. So a further surge in tourism teased out by the show is likely to provide an additional boost to sales.
A big problem, as the government sees it, is that too many of the kingdom’s visitors are what in the West are commonly referred to as riff-raff. What exactly does this mean in the context of Thailand? Essentially, these are tourists who go to Thailand because they can get away with doing things there that, because of law or custom, they could never get away with at home. (For example, smoking in restaurants, ignoring pedestrian crosswalks, patronising the girlie bars, getting falling-down drunk by noon, talking disrespectfully to the locals – you get the idea.)
Ironically, that situation has, if anything, worsened since mid-2022, exactly around the time that Anutin called for higher-value tourists. It was also mid-2022 when Anutin, himself, called for delisting marijuana as a narcotic. Thailand became the first country in Southeast Asia to do so, following on from weed’s decriminalisation in the previous year. This led to the opening of an estimated 10,000-plus weed shops and dispensaries within 18 months. They were concentrated heavily in the major tourist locations of Bangkok, Pattaya, Phuket and Chiang Mai. Weed tourism was on in earnest, and it has not brought a ‘premium’ kind of visitor.
To be sure, tourist numbers in Thailand last year were still in recovery mode. Official numbers showed they were about 30 per cent short of 2019. A kick-along from The White Lotus wouldn’t hurt. But will it attract a lot of the high-quality tourists that the government wants? That seems far less certain.
This story first appears in the May 2024 issue of Inside Retail Asia magazine.
The post Will Thai retailers benefit from ‘The White Lotus’ effect? appeared first on Inside Retail Australia.
