Domestic O2O how to play? From the whole channel of American retail to see where China O2O weak

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At present, the "O2O" mode adopted by the domestic department stores, whether from the point of operation or the concept itself, has Chinese characteristics. In the United States, a similar mode of operation is commonly used in the concept of "full channel retailing (omnichannel)". Although the wording is different, but from the operational level, there is no difference between the two.

How to play the domestic O2O operation?

At present, many department stores have started the "O2O" experiment, from these cases can be summed up in general two characteristics:

First, basically rely on the products of Ali or Tencent (currently not known as the solution), the core is to import passenger flow as the main goal of the scene and business settings. Included in the operating content is usually: preferential, diversion, mobile payment, membership and management, later will extend to CRM management, data analysis, Member precision management, but still focus on the marketing level;

Second, all the cases mentioned in the core O2O experience, in the application scenarios are dependent on the platform products, in the natural and common sense experience design limitations.

To further understand these features, you can take a look at the typical two application scenarios for domestic department stores:

One of the scenarios: mobile payment products as the core business design.

This scenario is usually provided by a mobile payment enterprise to provide a discount or rebate subsidy, the merchant provides some merchandise and the operation Link support, the two sides jointly carries on the marketing and the promotion. When the customer decides to purchase a product in the entity shop, he will take the small ticket to the cashier with the guide hand and choose some mobile payment when paying. Of course, do a little better in the counter can pay, but the mainstream model of domestic department stores, in order to control the "running list", is basically a unified cashier.

The biggest problem with this scenario is that it does not significantly improve the efficiency of the business, when the benefits and activities are over, because it is not natural and common sense experience design, often difficult to continue.

Scene Two: Virtual commodity wall Two-dimensional code purchase business design

This is a relatively closed-loop business design, physical stores will be a number of promotional efforts relatively large portfolio of goods placed on the virtual wall, and generate two-dimensional code. After the customer sweeps the two-dimensional code, completes the mobile payment (this scene under the mobile payment is conforms to the common sense link), needs to choose from the mention or The courier. If you choose to mention, you have to show the counter to pay the voucher delivery.

The trouble with this approach is: How to verify the counter? This must be equipped with mobile terminals or fixed terminal equipment in the counter, and the corresponding background system. You can also arrange to pick up the goods in customer service, or concentrate on a specific counter, but the cost and business fluency of the operational details are not ideal. If you choose to express, the scene becomes very interesting: why not shopping through the online mall? Instead, run to the physical store to toss about it. The more important problem is that the setting of the shopping scene does not meet the consumer's consumption habits and real needs in the physical store. At the same time, for the promotion of goods only in the activities of the launch, it is difficult to form a continuing business.

And if the department stores keep these promotional items for the virtual wall two-dimensional code sales, it is very similar to some of the traditional department stores in the entrance of the "promotional floats", is a very harmful business initiatives. Because promotional items should be moved along the physical store line layout to guide the passenger flow throughout the shop, which is also common sense of retail operations.

How do American department stores design the whole channel business?

As with their universal values, any industry in North America is sure to put "common sense" in a very important position when doing something, and the department stores are no exception. When designing an innovative experience, companies take full account of what the consumer's most natural state is, rather than forcing a change of habit.

If you get a chance to walk into Macy's at Herald Square in New York, and experience their application after deploying ibeacon, you'll understand the meaning of nature and common sense.

In ibeacon, the first phase of this Bluetooth-based indoor positioning solution, consumers can now experience not a lot of scenes, but very practical.

After entering the store, the consumer will be prompted to open the app and complete the two-way confirmed check-in (this is the core step to respect consumer privacy), then the sensor will push the store promotional information and electronic coupons. After entering the browse line, you can browse through each area from your smartphone app to the nearby area for promotions and further information, such as evaluation, commodity raw materials and price comparisons. This step, naturally, can be linked to virtual channels and a variety of social media, complete the seamless transfer between channels.

The next experience based on this technology will be gradually deepened. In terms of payment, the customer will be able to sweep the bar code on the product at the end of the purchase selection, through the mobile payment, or at some of the people or unmanned cash registers that have been set up through traditional or contactless electronic wallets. In the area of shopping experience and management, customers can set up their own products and hints by app in advance, and they will get relevant information when they enter the physical stores. For example, the setting of "evening wear", access to stores and through the relevant products, will be accurate tips and corresponding promotional information, even for specific consumers special discounts or electronic coupons ...

Overall, as of the present state, the core of North American operations revolves around "commodities" and is "natural" to adopt new technologies and improve consumer experience. The core of domestic O2O operation is around the "marketing campaign", through the form of preferential or electronic coupons, to change the consumer's certain habits and passenger flow path as the goal.

What are the differences between the United States and the domestic O2O operating experience?

In the United States, according to a recent IBM survey of 30,000 global consumers in 2014, five of the total channel capacity that consumers are most concerned about is (from high to low):

1, to ensure the cross-channel commodity price consistency experience

This is a controversial issue in the country, recently saw some experts pointed out that suning performance landslide is due to the line on the same price. But this is a common sense problem in North America, and if consumers see the same thing as a Macy's, the price is different on the Internet, in the physical store or at the mobile terminal, the first reaction would be that Macy's system went wrong! In order to ensure this consistency, U.S. Department stores will also set up for marketing purposes for a certain channel of goods, But it will certainly avoid the same commodity at different prices.

2, in the physical shop where customers need goods "missing code", can be different shop or directly from the warehouse to specify the address of the experience

This is a regular scene in the physical store, when consumers find a favorite goods but encountered a missing code, usually very frustrated, and this is the most common phenomenon of department stores. Full channel background, consumers can through their own intelligent terminals or in the store terminal to find out whether and where there is inventory, and then through the express way to complete the shopping. Although the business sector from the consumer point of view is very large, but in the past, most U.S. department stores do not, mainly because of the cost. But under the entire channel, because the virtual channel already exists, causes the distribution allocation link cost to be optimized, therefore, some department stores already started to support this service. Most of the domestic department stores do not achieve a single product management, even the minimum inventory real-time query can not do, can not complete the follow-up delivery process.

3, can be a real-time tracking of the order of each channel experience

In this regard, the domestic e-commerce enterprises to do very well, but the relative lag of department stores, especially in the context of O2O, cross channel business logic is more complex, the enterprise's technology development and system support capacity test greater.

4, different channels of stable product Classification experience

Most of the U.S. department stores are already in the mature stage, positioning clear, so in the category management is very cautious, will not easily expand the category. Even in the face of new channels such as the internet and mobile Internet, they will still stick to their business characteristics and go "deep" rather than "wide".

5. Be able to complete the return experience of the virtual channel order in the shop

The chain of American department stores is relatively large, so the experience can be well supported. The regional features of domestic department stores are obvious, but in the area of store concentration, this kind of experience should be realized.

What are the reasons for the differences between China and America O2O business?

The main reasons for this difference can be analyzed and summarized from inside and outside of the enterprise.

External impact: The two O2O have different driving forces

The main driving force of O2O practice in China is the Internet platform. As a platform, its products are universal, so department stores in the application, only according to the established product design business scene and experience flow. At the same time, as an independent profit organization, the platform needs to consider its own strategy and profit model, it is difficult to take into account the depth operation level of the consumer experience of the department store.

And the foreign driving force is the department store enterprise itself, so the starting point will take into account their own positioning, target consumers, commodity combinations and other characteristics, around the promotion of consumer core experience as the goal to carry out the whole channel sales. At the same time, most of the foreign department stores have been tested for decades and even hundreds of years, experienced or countless cycles and various shocks, it is clear that retailing is "a marathon for consumer services around commodities", so each design will focus on "sustainable operation" and "profitability" of the two basic criteria, Marketing is usually just one link. In contrast, domestic traditional department stores in recent years due to the decline in sales faster, profitability and survival pressure is very large, more need "fast" solution to quickly slow down the speed of customer churn.

The core reason is actually from inside the enterprise

Long-term joint venture system, most of the domestic department stores have in fact formed a commercial real estate operation thinking, do not pay attention to the business habits of goods is difficult to change. Under the whole channel background, it is still the thought of "the second landlord" with "the field control person". Because of the lack of a single product management technology base, can only be around the core of retail management-commodity and supply chain management, to pay attention to relatively easy to fast marketing links. North American department stores most of the goods for their own self, and the level of information investment and relatively high, so can be based on the product design of the entire channel experience.

Beyond marketing, where is the O2O opportunity for offline retailing?

As the sample is collected globally, the experience focus mentioned in the IBM survey presented in this article does not necessarily constitute support for the action of the Chinese department store business. But can provide the reference is the American department store enterprise decision-making methodology--starts from the consumer real concern question, more through the common sense judgment, but not from the department store management operation Angle or the expert consultation to solve.

In the past "Old World" retail history, no retail company has relied on marketing success to maintain the evergreen, this law applies not only to the United States, but also applies to the world, of course, including the characteristics of China. Therefore, department stores in the Internet platform to obtain the flow of support, more need is the whole business chain key link "internal strength" of the overall upgrade to ensure that the flow of precipitation and repeat the purchase of operating indicators.

As the whole channel key node equipment--the popularization of the intelligent terminal, will make the consumer in each channel seamless jump experience becomes possible. But for the domestic department store enterprise, the single goods management is the prerequisite technology, the similar ibeacon indoor localization technology is realizes the natural fluent entire channel experience key technology. Without the support of these two technologies and the corresponding backstage system, any form of O2O can only be carried out at the marketing level.

Finally, a set of key numbers mentioned in the IBM survey will still be cited as the end of this article: the purchase ratio of the entity shop dropped from 84% in early 2013 to 72%; Physical store test on the internet to buy "behavior accounted for by 50% from 2013 to 30%, meaning that 70% of consumers have been accustomed to directly in the virtual channel to complete the shopping, physical stores even want to be" fitting room "opportunities are disappearing gradually.

The writer is a retail shareholder in China, now in Canada, focusing on North American retailing and rethinking the Chinese retail market