Western countries have always led innovation in retail. Today China is leading with Alibaba being ranked second world’s most valuable retail brand in 2016. To understand the state China consumption, we can look at the 10.6 % YoY increase of the consumer trade revenue (August 2016). This opportunity is leading to a lot of competition. It is forcing prominent actors to create a unique shopping experience. The critical objective is when the consumer doesn’t feel any friction during his journey. Furthermore, the environment offered by the government optimise opportunities and exploration. This is when O2O appears, to expand the shopper’s experience.
O2O commerce is a business strategy that draws potential customers from online channels to physical stores. Online-to-offline commerce identifies customers in the online space such as through emails and internet advertising. O2O then uses a variety of tools and approaches to entice the customer to leave the online area. This type of strategy incorporates techniques used in online marketing with those used in brick-and-mortar marketing.
In the latest news, Alibaba Group Holding offered 2.6 billion dollars to acquire Intime Retail Group. By doing so, they are accessing to 29 Megastores and 17 malls all over the country. This investment could give Alibaba the chance of digitising that physical store. Also, they will offer consumer and brands more natural ways of consuming in an Offline to Online full and Online to Offline experience.
« In the coming years, we anticipate the birth of a re-imagined retail industry driven by the integration of online, offline, logistics and data across a single value chain. With e-commerce itself rapidly becoming a ‘traditional business,’ pure e-commerce players will soon face tremendous challenges. » – Jack Ma
Digitizing of commerce is growing and offers excellent opportunities for brands and retailers. O2O strategy development is the right answer to the e-commerce growth, 30% in 2015. Also, in 2015 we can highlight the fact that offline research still had a significant share in informing before buying. Furthermore, the unification of data collecting in O2O is essential in a market where consumers switch channels.