What is O2O (Online to Offline)? Introduce representative measures, measures, and domestic cases

O2O (Online to Offline) utilization cases are increasing, which use online services that use the Internet to direct customers to offline locations such as stores . One of the O2O measures is sales promotion activities such as “LINE @ started” and “Official app registration” that can be seen in the city.

For the introduction and success of O2O sales promotion activities in your company , it is necessary to realize recognition and interest by providing information online and realize a smooth purchasing experience for customers.

In this article, we will explain useful information for those in charge of O2O marketing activities, such as the characteristics of O2O, specific measures, success stories, and points for success.

Table of Contents

O2O (Online to Offline) refers to measures that lead to purchases by guiding users to physical stores, etc., based on user behavior on the Internet, such as websites and apps. “User behavior on the Internet” corresponds to online, and “visiting a physical store” corresponds to offline, and is called “O2O” as an abbreviation for “online to offline”.

Use SNS such as Twitter and Instagram, apps, websites, etc. to guide users offline. In addition, measures are being taken that utilize the location information function (GPS) of smartphones. For example, the following use cases are given.

• Distribute discount coupons that can be used at physical stores on the official website
• Advertisement delivery to smartphones of users near physical stores

In terms of measures to connect online and offline, “omni-channel” is also attracting attention. It is a method that integrates multiple sales channels such as physical stores and EC sites and does not make customers aware of the channel. Omni-channel marketing can be said to be a further evolution of O2O, but O2O tends to be easier to introduce in terms of budget and operation. If you are considering online measures centered on physical stores, let’s first accumulate know-how through O2O.

Online advertisements distributed for the purpose of directing users to physical stores and other offline locations, promoting purchases after visiting a store, and distribution of coupons via SNS are called “store customer-attracting digital advertisements” and “O2O advertisements.”

According to the ” Market Scale Survey for Digital Advertising (O2O Advertising) to Attract Customers” jointly conducted by CyberAgent, Inc. and Digital Infact, Inc. , the size of the market for digital advertising (O2O advertising) to attract customers in 2019 is 405%. billion yen, approximately doubling from 20.5 billion yen in 2018. It is expected to grow to 258.6 billion yen in 2024.

According to the ” Domestic e-commerce market size (BtoC and BtoB)” released by the Ministry of Economy, Trade and Industry in July 2020 , the size of the domestic BtoC e-commerce market in 2019 was 19.4 trillion yen (18.0 trillion yen in the previous year, up 7.65% from the previous year). % increase). Of this, the EC rate, which is the ratio of the e-commerce market size to the total commercial transaction amount (commercial transaction market size), is 6.76%. Although the B2C EC market is expanding, we can see that many purchases are still made at physical stores.

On the other hand, the number of consumers who collect information on the Internet before purchasing products is also increasing. Looking at this reality, the purpose of O2O marketing is to promote online-to-offline guidance and provide a beneficial customer experience by purchasing products at physical stores.

In addition, consumer behavior has diversified in recent years, and an approach that matches the characteristics of each user is required. For example, for those who are particular about price, there are approaches such as “providing discount services such as coupons in a timely manner” and “introducing a high-quality customer experience” for those who value satisfaction. Generally, the former leads to short-term sales effect, and the latter leads to long-term relationship building.

The main means at the stage of “attracting customers from online to physical stores”, which is the first initiative in O2O marketing, are as follows.

• Targeted advertising using smartphone location information
• Push delivery to consumers who have installed a dedicated app on their smartphones
• Push delivery to consumers near physical stores using beacons

Once the guidance to the physical store is completed, the next step is to provide an experience unique to offline that cannot be obtained online such as EC sites. For example:

• Accurately grasp the information that customers want to know, and provide and propose necessary information
• Communicate products and services through bodily sensations and five senses

Offline, you can get more detailed customer information than the lead information you can get online. Consider creating a database of the customer information you obtain and using it for marketing.

By introducing O2O marketing, you can get the following benefits that make use of the characteristics of both online and offline.

Acquisition of new customers

You can deliver product information and campaigns to new customers by utilizing functions unique to online, such as SNS used by many users and targeted advertising using location information.

Ease of effect measurement

It is relatively easy to verify the effect of O2O through analysis based on data such as online advertising costs and coupon usage records at physical stores.

Customer-tailored promotions

On SNS, it is possible to deliver advertisements using user attributes such as gender, age, and birthday. Utilizing this information and performing distribution tailored to each user improves customer satisfaction and leads to sales promotion.

Accumulation of know-how for omni-channel construction

Omni-channel construction generally requires a larger budget than O2O implementation. You can accumulate your own know-how through O2O marketing operations and use it to build omni-channels that can attract more customers.

When planning your O2O strategy, focus on the linkage between “online to offline guidance” and “offline customer experience.” In other words, online connections such as SNS and e-commerce sites and offline connections such as physical stores will function as a “line” through the point of contact with consumers. In this way, good relationships can be expected to be built through communication between companies and consumers at each point of contact “online” and “offline.”

Many documents about O2O talk about “online to offline induction”. However, if you want results from the original O2O marketing, it is necessary to devise measures for “offline customer experience”. Let’s repeat coming up with ideas and making improvements while referring to the channels and examples introduced below to find out what kind of experience you can provide to consumers in a physical store and improve their satisfaction.

O2O starts with engaging customers online. The main O2O measures are explained below. Make sure you understand the characteristics of each before using them.

website

If you operate your own website, you can send useful information to customers at the necessary timing, such as product introductions, campaigns, and issuing coupons. During operation, as a measure to increase the number of accesses, we will implement SEO measures as well as content introduction via SNS at the same time.

SNS

The large number of users and the ability to spread information on SNS such as Twitter, Instagram, and Facebook are now essential elements for marketing. It is also possible to deliver advertisements by detailed targeting using the user attributes of these SNSs, enabling more efficient sales activities.

EC site

The advantage of an e-commerce site compared to a physical store is that there are no business hours or geographical restrictions. However, there are some consumers who do not make purchases due to reasons such as being unable to actually check the products when selling through e-commerce sites. If you introduce a physical store on an EC site, you can increase awareness and provide customers with multiple sales opportunities.

e-mail magazine

By using e-mail magazines, continuous information distribution is possible in addition to one-off information such as campaigns. Consider attractive incentives for consumers to grow your subscriber base, or fan base for your company.

app

Apps are a powerful channel in O2O marketing. If you create your own app and have it used by consumers, you can provide services that meet consumer needs, such as location-based advertising, coupon distribution, and payment functions. Try to design a service that makes users want to install the app in order to increase the number of users.

We will introduce successful cases of O2O marketing using apps. With the spread of smartphones, the appeal of apps to consumers is increasing.

Uniqlo

By installing the app on your smartphone and registering as a member, you can get special prices and coupons only for app members, which is an incentive to install. In addition, we provide services that guide customers to physical stores, such as “You can check store inventory from the app” and “Free shipping when you pick up items purchased online.” In addition, you can pay quickly with UNIQLO Pay.

McDonald’s

We provide an official app based on the concept of “futuristic store experience” that provides a full range of services for each customer. For example, if you order a product with a mobile phone, which offers cashless payment by pre-ordering with a smartphone, you can receive the product at the store without lining up at the cash register. In addition, we regularly deliver coupons that can be used for both traditional counter orders and mobile orders, building continuous connections with consumers.

When implementing O2O, it is important to consider how customers who have attracted customers, such as online measures such as apps and SNS, can have a satisfying experience. In other words, the keys to success are “collaboration between related departments” and “provision of a continuous experience that keeps consumers from getting bored.”

Establishment of internal organizational structure

Delivering a customer experience cannot be achieved through the efforts of brick-and-mortar stores alone. It would be better to set up a dedicated department responsible for planning and promoting the O2O strategy. In specialized departments, let’s promote measures in cooperation with related departments within the company.

Pursuit of customer experience in physical stores

The physical store is at the heart of the customer experience. Staff who interact with customers are required to come up with ideas for further service improvement and to carry out continuous improvement activities. In order to improve the customer experience at the physical store, let the staff fully understand the purpose and role, and take the necessary measures.

In case studies of O2O, the common pattern is to encourage people who visit a physical store to install the app to establish online contact points, and to attract customers by notifying them of new product arrival information and coupons through push notifications. target. However, these cases are already being used by many companies.

In order to differentiate from competitors, instead of focusing only on attracting customers from online to offline like the O2O marketing method, please incorporate your own unique route that can provide customers with a smooth purchasing experience.

After introducing your own measures that can provide a high-quality purchasing experience, continue to implement and improve the O2O cycle while observing customer reactions.

The O2O advertising market is expected to grow steadily in the future, making it difficult to succeed simply by creating an app and issuing coupons.

In order to develop O2O measures ahead of competitors, the key to success is “designing our own unique flow that provides customers with a smooth purchasing experience” and “providing a satisfying customer experience.” Furthermore, it is necessary to create an organization for promoting O2O marketing within the company.

In order to further retain customers, there is a way to evolve from O2O to omni-channel. Accumulate O2O know-how to realize omni-channel that matches your company.