O2O (Online to Offline), the Perfect Opportunity to Combine Physical and Digital Channels in Retail

Over the past few years, online commerce has had a big impact on retail. Every player in the retail sector has witnessed changes to circumstances that for some decades had seemed stable, and they have had to adapt to newer developments.

Changes in consumer mentality, with the new offering that is being presented to them, have motivated the development of new concepts that can meet their needs. And, above all, these concepts have been implemented in the traditional points of sale, and they are focused on providing consumers with unique experiences that online channels cannot compete with.

But this is not enough; we must combine all the advantages that both channels have to offer. The digital and retail worlds need each other to give the consumers a complete experience.

Changes to the Retail Sector

The retail sector has evolved a lot in recent years. As we have mentioned, this is due to the pressure of competition with digital retail. Among the changes that it has gone through, we will highlight three:

Points of sale, more than a store: The traditional concept of a store no longer attracts customers. There must be something more for them, and retailers must work to provide them with an experience that is much more meaningful than that of the simple transaction.

The introduction of digital technology to the point-of-sale: Retailers are progressively introducing digital elements into their commercial spaces, with the aim of making the user experience more complete, in terms of visibility, comparison, information, interaction, or within the payment process itself.

Online sales in offline locations: Online retailers also want to participate in offline sales and, little by little, they are being introduced to these channels. However, not as traditional physical points of sale, but by moving online experiences to offline channels.

Partnerships Between Ecommerce and Large Retailers Have Ushered in a New Era

With the emergence of new players and consumers becoming more demanding, it is normal for changes to occur in the sector. One of the most striking of these changes has to do with the relationship between large retailers and traditional online sales businesses.

As an example, on an almost global level, we have the Chinese giant Alibaba, and its immersion in the retail sector, with its purchase of 36.6% of Sun Art Retail. But the most striking thing about this transaction is not only that, but the fact that they did it on behalf of Auchan Retail, which is a major player in retail at the global level.

The goal of this partnership is for them to gain a deeper understanding of their end customers and their behavior, both online and offline, through combining Alibaba's online sales data with Auchan's retail network.

This is not the only notable partnership uniting online and offline channels. Amazon's approach with Whole Foods Market has been another striking case in the U.S., as well as Groupe Casino with the online retailer Ocado in France.

What is the Role of Innovation within this New Paradigm? 

New technologies and online channels have a lot of say in this new retail model. Digital innovations may make a big difference in retail sales as we know them, always seeking satisfaction for the end customer.

An example of how new technologies can boost innovations in retail is the contribution of home devices such as Alexa or Google Home, which assist their users in performing domestic tasks such as making phone calls, playing music, searching the internet for information or shopping for products online. In fact, Google has already established a partnership with the Walmart supermarket chain, in order to facilitate the purchasing of products with voice commands through the Google Home device.

This is something that HMY has always concentrated on and transferred to their proposals: with innovation comes differentiation and, without this, there are no sales. The key to success in a sector like retail, which is competitive and constantly changing, is to create different approaches and unique shopping experiences, and it is becoming apparent that this will be a predominant trend in the coming times.

How Does HMY Help Brands to Address these Concerns?

When faced with the threat of online commerce, many retailers are experiencing problems that they didn't have before. To emerge victorious in the face of these issues, we must continue evolving and offering a distinctive and exclusive experience to our customers.

Some of the proposals that HMY has recently carried out in this direction include innovations in checkout areas, greater access to information about the products offered and more interaction with customers.

As Regis Cao, BU West Marketing Director at HMY, says in an interview with the newspaper L'Yonne Républicaine, "the key is in the creation of spaces and concepts in points of sale, which offer customers an innovative experience, different from what they may have while online shopping or in traditional stores."

To do this, we must take advantage of the opportunities provided by technology and keep up with the pace of the sector's evolution and as well as that of the consumer, who is becoming more and more demanding with very different needs compared to just a few years ago.

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