This article was written by Prashant Kartikeya.
Of late, both ‘traditional economy’ (eg. CPG) and ‘new economy’ industries (eg. Online marketplaces), have begun to recognize that customers flirt online and offline, with their brands. ‘O2O’ (‘offline to online’/ vice versa) the buzzword is fast turning into a market reality.
To begin with, lets understand what is possibly driving this phenomenon:
- Increased penetration of smart phones & wider internet access has enabled transitions between online and offline, during the customer journey
- Growth of online marketplaces is another factor
- Also, customers often know that the same product is available through multiple channels. They tend to explore which channel is most beneficial, to their purchase-decision. It is reported that 88% of U.S. customers research online but purchase offline. On the other hand, 84% of Chinese customers deal-hunt in a physical store, before purchasing online.
Online/ offline shifts that customers make, affect businesses in multiple ways. Some brick-mortar retailers are being reduced to ‘showrooming’ products available online; thus facing dramatic decline in sales. Similarly, certain pureplay-online retailers are experiencing mediocre sales; as customers find their online shopping experience impersonal, non-tangible.
If you are a product/ service organization, such an environment signals the need for integrating your online and offline channels; to offer a seamless customer experience.
Which brings us to understanding what online-to-offline (O2O) commerce really means. As the name suggests, it is a business strategy designed to bring online customers to brick-mortar locations. Doing so helps businesses arrest ‘leakage’ of prospective customers (typically browsing multiple brands). Adopting O2O helps businesses retain such customers, foster brand loyalty, encourage positive word-of-mouth. Considering that conducting online research before taking big-ticket purchase decisions is the reality, channeling even a small percentage of their online research to your offline store could represent a massive potential for sales.
A seamless experience before, during and post-purchase benefits customers as well. It enables customers to enjoy advantages of Real-time information, convenience, lower prices etc. plus Offline physical experience and service.
O2O commerce enables businesses to treat online and offline channels as complementary, rather than competitive means of customer acquisition & servicing. For instance:
- In-store pickup of products that were purchased online
- Online purchase of products, while customer is at a physical store
- Returns of Online purchases, at physical locations
There are other ways as well, for businesses to leverage O2O commerce:
- Map offline customers to their digital identity, for a fuller profile of the offline customer
- Track, follow, analyze every move the online customer makes, to decide what products to promote, when to promote them and through which channel
- Track customers’ Pinterest pins, to identify and then promote, trending products to those customers, at brick-mortar stores visited by those customers
- Offer a personalized shopping experience, including customized offers and tailored suggestions; basis each customer’s location. Personalization can also be offered by gathering customer data from their browsing sessions, the ads they click on digital platforms etc.
ThinkBumblebee partners businesses to map brick-mortar customers to their digital identity, aggregate and organize such data and analyze it; to address core business issues like:
- What is the impact of online visits to my official website, on my brand’s offline sales?
- What is the impact of offline advertising/ campaigns on my brand’s offline sales?
- Which offline advertising/ campaigns enabled my online sales the most?
- Which marketing channels influence my brand’s offline sales the most/ least?
Reach us at ThinkBumblebee to understand how.