Online-offline integration of retail business gains popularity

2017-02-18
english.gov.cn/China Business Network

O2O business models are starting to gain popularity across the country after the State Council urged the integration of online and offline retail businesses last year.

A female white-collar worker purchased some goods at a cross-border online retailer’s physical store at a shopping mall in Beijing, and registered to be a member of the store’s online platform simply by scanning a QR code at the checkout counter.

Online retailers’ offline stores can provide customers with the insight experience of varied items, which will in return promote sales when customers’ offline consumption loyalty has been created.

Regarding this increasingly popular consumption model, Premier Li answered questions about whether thriving online retailers will absorb the profit of physical stores at the two sessions in 2015, saying that “the interaction of online and offline business can create vitality and larger spaces for mutual development”.

The Premier also called for promoting coordination, interaction and fair competition between online and offline stores and encouraged physical stores to transform themselves through innovation when delivering the annual work report in 2016.

Offline businesses are becoming more important, with their irreplaceable advantage in shopping experience and personal connection with customers that online stores cannot provide.

A Chinese e-commerce giant announced last year that it would adopt the “New Retail” strategy that will allow the company to tap into the retail sector in China by eliminating the distinction between online and offline commerce.