Cross-border tourism and the emerging nation: taxonomy of the ignored shopper

Abstract

The growth in Laos’ economy has been increasingly important in terms of consumption and tourism within Thailand. Currently, however, few studies have attempted to develop a marketing strategy for regional retailers in this emerging nation. This research is concerned with developing an appropriate marketing strategy that balances supply and demand within this regional market. Given that marketing relies heavily on understanding consumer behaviour, the objectives of this study are, first, to develop a cross-border shopper taxonomy in a regional market using benefit segmentation. In order to develop this marketing strategy, the research identified consumer expectations in order to explore how to achieve a competitive advantage that matches consumer needs with the available supplies. This cross-border shopping taxonomy provides a starting point for a holistic evaluation that will assist retailers in making marketing decisions. The study then attempts to understand the current market situations and marketing in practice from the perspective of suppliers. After assessing the correspondence between demand and supply, recommendations on strategic marketing are offered to Thai retailers at the end of the investigation. This study employed both quantitative and qualitative research methods, with 337 questionnaires and seven in-depth interviews. The survey was conducted in Thailand between December 2013 and January 2014. The data were collected from three provinces in the northeast region of Thailand that share a border with Laos: Nongkhai, Mukdahan and Nakorn Phanom. These provinces have high potential in respect to both tourism and retail developments. In addition, the seven interviewees with retailers and policy planners examined the implementation of market segmentation and marketing strategies. The data from the interviews was interpreted and compared with the quantitative data in order to investigate the correspondence between supply and demand. In order to classify cross-border shoppers, the major statistical analyses used were EFA and cluster analysis based on benefits sought. Segments were profiled with travel behaviour, shopping behaviour and demographic variables. ANOVA and MANOVA were employed to test differences between groups. After that, the research explored expectations through the Importance-Performance Analysis (IPA) in order to identify priorities for developing a competitive advantage. The results show that cross-border shoppers in the regional markets of Thailand consist of four segments: the Enthusiastic shoppers, the Leisure-tourist shoppers, the Product-focused shoppers and the Practical shoppers. These segments relate to the benefits sought, and correlate with different demographic variables, shopping activities and consumption patterns. Moreover, they have different expectations towards place attributes which are important for designing a marketing strategy that is suitable to each segment. Unfortunately, the interviewees from the supply side provided less marketing response to the cross-border tourist marketing. The implications of the findings are, first, that benefit segmentation is associated with demographic variables, shopping activities and expenditures. In addition, the evidence suggests some misunderstandings on the part of suppliers in respect to cross-border demand. The evaluation of demand and supply contributed recommendations for the design and management of effective marketing strategies for cross-border shoppers in this emerging nation.