O2O COMMERCE INDUSTRY TRENDS

O2O COMMERCE INDUSTRY TRENDS

For many retailers, online-to-offline e-commerce was the key to growth in 2020 and is predicted to continue the keyword onward. The coronavirus pandemic pushed more consumers online—but for those still longing for in-store experiences, retailers needed to refine their online-to-offline (O2O) strategy to open their doors to online shoppers.

1. What is O2O commerce?

Online-to-offline commerce is a business strategy designed to bring potential customers from online channels to physical stores to make a purchase. It brings people from Facebook, Instagram, email, and digital ads to a brick-and-mortar store.

It’s not to be confused with omnichannel, where customers go back and forth between online and offline channels. O2O commerce brings together techniques from online marketing and brick-and-mortar marketing. It turns eCommerce visitors into physical shoppers by:

• Offering in-store pickup of products purchased online
• Facilitating the purchase of products while at a physical store
• Allowing online purchases to be returned to the retailer’s location

2. How does O2O commerce work?

The purpose of O2O commerce is to create awareness for products and services online, then visit the store to make a purchase. Techniques include home delivery, curbside pickup, and letting customers place orders through your online store to pick up in-store.

3. O2O commerce business model benefits

Give shoppers what they want

Research shows that 61% of shoppers would rather shop with brands that also have a physical location (versus those that are online-only).

Brick-and-mortar shopping gives customers a chance to chat with sales reps, touch products in person, and get the in-store experiences that cause consumers to open their wallets. In the meantime, online shopping offers the convenience and comfort of selecting items, or shipping etc.

Combine that in-store customer experience with an online strategy so shoppers can read detailed product descriptions without talking to a sales rep. They can use a mobile app to redeem points on a loyalty program and redeem social media coupons for money off in-store.

Reach more customers

An O2O commerce strategy means traditional retailers can reach more customers than those who just walk in the door.

Indeed, not everyone passing by your brick-and-mortar stores will pop in when they get a chance to do so. The vast majority (87%) of shoppers rely on the internet to research new products, turning to search engines, social media platforms, and review aggregators to help them decide what to buy.

When retailers use these online channels effectively, they can build niche audiences around their physical locations. This drives internet users toward brick-and-mortar stores—resulting in more foot traffic than if they were IRL-only.

Brand recognition and sales

These days, shopping journeys are anything but linear. Customers are always (and often subconsciously) shopping—especially when they’re online. Retailers need an O2O commerce strategy that reaches them at those points, funneling potential customers from several online channels into its brick-and-mortar store.

According to Aspect Software, businesses that adopt an omnichannel strategy achieve a 91% year-over-year customer retention rate compared to those that don’t. Plus, retailers with a strong omnichannel customer engagement retain an average of 89% of their customers, compared to 33% of those with weak or no omnichannel customer engagement.

Save money on logistics

Ecommerce logistics often become more complex as you scale. However, an O2O commerce strategy—especially the buy online, pick-up in-store model—helps merchants cut down logistical costs. Retailers can regionalize their inventory and dedicate a percentage of their store space toward storing products that have been sold online.

Doing this allows retailers to reduce their reliance on third-party logistics (3PL) partners. They can also confidently offer same- or next-day pick-up for customers since the products are already in-store.

  4. O2O commerce industry trends

BOPIS

For many people, 2020 was a year when online shopping and curbside pickup replaced shopping in-store.

Buy online, pickup in-store (BOPIS) services help drive those online shoppers back to physical stores. Customers can use a retailer’s eCommerce site to browse products, purchase those they like, and receive a notification when it’s ready to collect from their local store.

For retailers, click-and-collect is a chance to bring online customers to offline stores. Once you have the customers in-store, you have the opportunity to entice them to purchase other products.

Home delivery

The convenience of click-and-collect shopping has made it one of the retail industry’s biggest trends in the last few years.

Retailers can partner with couriers like Grab to deliver purchased items to a certain place. Retailers can also do their own delivery to people within a certain radius of a store.

An important note for retailers is to make sure the number of delivery orders per date and set preparation time rules.

Invest in local SEO

Did you know that 50% of people who used Google search before shopping looked for details about the store itself, such as locations or proximity? Not only that, 79% of holiday shoppers who visited a store turned to online search first.

A great deal of in-store shopping behavior derives from mobile users looking for three things:

– Help to inspire a purchase

– Help to plan the trip to the store (such as directions or nearby parking)

– Help narrow down purchase options

Investing in local SEO can help potential customers find your business online during their search. The aim is to show up in local search results for terms like “fashion stores near me” and provide enough information to convince shoppers to visit your store.

QR codes

People arriving at a retailer’s store still consult the web during their visit. Some 55% of shoppers use their smartphones to find product specifications. Another 40% check whether they’re eligible for exclusive offers.

QR codes, which look like bar codes, blend the O2O shopping experience. Retailers can place them in areas with high foot traffic—such as checkout desks and fitting rooms. Customers can scan these QR codes when they’re shopping at a physical location to:

• Join a virtual queue outside the store
• Retrieve their curbside pickup order
• Redeem loyalty points on in-store purchases
• Scan a product they’re returning through a mobile app
• Participate in customer feedback surveys

**Source: Internet