Marketing Strategy Development of Community Businesses in Thailand

Srikaew, Anuwat
(2009) Marketing Strategy Development of Community Businesses in Thailand. PhD thesis, University of Liverpool.

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Small community businesses in Thailand have flourished, noticeably under the OTOP scheme, started in 2001. This study focuses on community businesses (CBs) in Chiang Mai province involved in the production of fabric and clothes that have faced issues such as marketing problems. Appropriate marketing strategies can be employed to ensure that these issues can be managed, allowing these community businesses to eventually become self-reliant. The objectives of this study were to: I) Investigate the internal and external factors that influence marketing strategies of community businesses; 2) Examine the existing marketing strategies employed by community businesses; 3 ) Consider which of these marketing strategies should be developed to benefit the community businesses; 4) Develop the chosen marketing strategies further. Mixed method approaches were employed, referred to in this study as Exploratory Sequential Design. This design starts with a qualitative approach, and then builds to a quantitative study. Phase 1 (QUAL I): Document study and the use of focus groups, aimed at exploring phenomena and context (the internal and external factors influencing marketing strategies of community businesses). Phase 2(QUAL 2): In-depth interviews and observations were conducted to prepare variables and questionnaires for the quantitative approaches that were later employed. The results of phase 1 and 2 (qualitative phases) showed that the macro-external (political, social and cultural, economic and technological) factors had a significant impact on community businesses, both providing opportunities and creating threats to their potential success. The study of micro-external factors (customers and competitors) showed that the OTOP Groups' sales were mainly to local customers. Customers also included wholesale distributors, overseas buyers and tourists. Competitors ranged from local producers and factories to neighboring countries.The study of internal factors showed that organization and management was undertaken in a cooperative style. The manufacture and production of products was typically hand made or machine made in the traditional local style, using locally sourced raw materials. Financially, community businesses were found to build their capital from the shareholders and members of the business, as well as securing external funding. Financial education was also provided by agencies affiliated with the OTOP project. Marketing, which also come under internal factors, was seen to have four main areas of focus, namely product, price, place and promotion. The products being produced fall in to the categories of fabrics, clothing, personal effects, household articles and souvenirs. The prices are set by a combination of production costs and rivalry between competitors. The distribution, or place of sale, was seen to be through a variety of shops, wholesalers, exhibitions and events. With advertising being expensive, cost effective methods to promote products used included name cards, brochures and in some cases buying local radio advertising space. Phase 3 (QUAN I) Under a quantitative approach, the researcher used survey method with 400 customers of CBs in Chiang Mai province of Thailand. Statistical methods of Factor Analysis, Multiple Regression, and Percentages were used in this study. The results of the factor analysis showed six components, or factors, that would be significant areas of interest: Place, product, personal selling (customer service), promotion, packaging and price. This was ascertained through a rotated component matrix, listing the factors loading after rotation. Using the process of multiple regression on these six factors, three key areas of place. product and personal selling (customer service) were identified as being the most significant areas to develop marketing strategies. These three areas of place, product and personal selling (customer service) were subjected to SWOT and TOWS analysis to systematically develop and suggest 15 appropriate marketing strategies. These are as follows: (I) Broaden the range of traditional clothing garments produced; (2) Gain knowledge of latest fashion trends, in order to develop stylish garments incorporating modern designs with traditional fabrics; (3) Employ stricter quality control measures to ensure products are of consistently better quality; (4) Encourage producers of high quality products (4 star and 5 star) to broaden their channels of distribution into the potentially lucrative export market; (5) Identify staple items that are most popular with customers implement a production strategy that caters to these market demands; (6) Broaden the channels of distribution utilised by community groups to sell their products; (7) Maintain rigorous staff training programmes, to ensure that all sales staff have detailed knowledge of the products they are selling to customers, as well as modem selling techniques; (8) Community businesses should focus their production firmly on handmade, traditional, intricate products that are unique to their local area; (9) Develop a complementary network of producers producing inter-related goods; (10) Utilise government funding to establish 'one stop' OTOP shopping centres within each district town centre in Chiang Mai to cater for customers interested in OTOP products; (II) Develop a range of natural, colour-fast dyes for fabric; (12) Improve the consistency in terms of quality of community business products: (13) Cease production of modem clothing garments; (14) Educate CB employees about the negative impact of chemical dyes on the customer and the environment; (15) Improve the layout and visual appearance of OTOP retail premises in order to make them distinctive from those of their competitors.

Item Type: Thesis (PhD)
Depositing User: Symplectic Admin
Date Deposited: 20 Oct 2023 09:24
Last Modified: 20 Oct 2023 09:45
DOI: 10.17638/03174411
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