O2O For A New Purchasing Experience

The future of retail is not a question of channels, but of experiences. From "New Retail" to online-offline marketing, e-commerce giants are investing in O2O channels, with China as forerunner


Today digitization is taking the world online and New Retail is replacing traditional retail.

Pioneered by Alibaba, the blending of online and offline commerce is introducing experience in the equation, thus changing the whole retail game not only in China, but now in the whole world. 

Without any doubts, Chinese e-commerce giants – especially Alibaba – are the forerunners in this sector.

According to McKinsey’s China Digital Consumer Trends 2019 report, only 12% of purchasing decisions happen entirely online. 

It means over 88% of consumers — especially Gen Z and Millennial consumers — make their purchasing decisions through an omnichannel process — both offline and online. But let’s start from the beginning. 

Driven by digitalization, the development of the omnichannel and new customer requirements, trade, and retail have undergone profound changes in recent years. 

As we know, the New Retail model was a concept introduced for the first time in 2016 by Jack Ma, founder of e-commerce giant Alibaba. 

The philosophy behind this project is easy and simple: the future of retail is not a question of channels, but experience

Therefore New Retail aims at offering a new shopping experience without boundaries, combining online and offline commerce to the best of both online and offline shopping experiences. 

The entire customer journey has been redesigned. Nowadays, the main goal is to bring customers a highly personalized, interactive and satisfying retail experience by utilizing the power of new technologies and data science.

In few words, online and offline purchasing cycles are no longer separate, and now the New Retail concept – as well as O2O channels – from China, is spreading around the world.  


The one-dimensional purchasing tunnel as it existed a few years ago is no longer relevant

With the New Retail model, consumers will no longer think in terms of separate purchasing channels but use all of them at the same time for various purposes such as product research, delivery or customer service. 

O2O e-commerce combines the best of digital commerce and traditional retail to meet the demands of both consumers and retailers.

The Offline-to-Online business model lets people access to an extensive inventory of various products on their “customer journey”. 

The price comparison engines for example, allow consumers to make informed decisions when purchasing products online. 

Secure payment options, including internet transactions, credit/debit cards, and more, are very convenient without the need to carry cash on hand. 

But offline market has advantages too. Consumers can physically examine products before purchasing, while is well known how interaction with businesses could boost trust and customer loyalty.   

O2O allows retailers to leverage the best of both markets to expand their reach, increase acquisition, conversions, and sales.

A very useful approach of O2O commerce is in the marketing sector: as well as in the purchasing journey, omnichannel marketing offers a unified shopping experience across all channels, both online or offline. 

It levels the ‘boundaries’ between different sales and marketing platforms for a fully-integrated approach, centering around the consumers, ensuring a single buyers’ journey on every platform.

Thus, is easy to assume how New Retail is based on a solid merchandising strategy that arranges the products to generate a strong desire to buy. 



As consumer-centric strategy, in-store technology has now become part of the New Retail approach in order to attract customers and help them make purchasing decisions quickly. 

New Retail, at least in China, has made static stores obsolete. The in-store experience is lively now and leverages “sensory marketing” to influence the behavior of customers. 

China already settled a model path as mobile-driven society and mobile payments are two crucial factors in the spread of New Retail across the country.

Chinese consumers rely on apps for both online shopping and payments at physical stores: about 81% of smartphone users in the Middle Kingdom will use mobile payments this year, compared to just 27% in the US. 

Here is what differentiates Alibaba’s model from the others tried so far: integration

Integrating data is a crucial evolution to understand everything about the consumer buying process. 

This means being an open book so that the system could know what the consumer needs before he actually needs it.

What’s next? Modern shoppers demand convenience and smooth shopping experience online and offline. 

Aside from China – where the entire O2O market is gearing up to surpass 1 Trillion Yuan by 2022 – the O2O commerce is still in its infancy, but it is growing exponentially everywhere as startups and enterprises recognize its benefits. The whole sector’s future is promising and is still growing.