The concept of O2O is not new, but it is very important. According to the analysis report of Forward-looking Industry Research Institute "20 16-202 1 China Catering O2O Market Prospect and Investment Strategic Planning", online consumption in the United States only accounts for 8%, and offline consumption still accounts for 92%; In China, the proportion is 3% and 97% respectively.
4.5% and 95.5%). Alex, founder and CEO of TrialPay
Rampell's statement is vivid: "The average online shopper spends about $65,438+0,000 a year. If the average annual income of Americans is $40,000, the remaining $39,000.
Where is the dollar? The answer is that most of them are spent locally. People will spend money in coffee shops, bars, gyms, restaurants, gas stations, plumbers, dry cleaners and hair salons. The mission of O2O is to introduce the effectiveness of e-commerce into the part that accounts for more than 90% of current consumption.
Then, compared with other e-commerce models, what is the uniqueness of O2O, whether there is a stable existence and development space, what impact it will have on the sales model, and how to ask it to bear these problems in the future, then let's approach O2O.
First, from the business itself: What is the difference between what O2O does?
1, O2O as the information flow digger of products and services.
1) Past life of O2O
O2O is nothing new. In the development of e-commerce in China, O2O is one of the oldest business models. In the "ancient" O2O, Ctrip.com is an excellent representative.
A friend of mine told me that in the last century, it was he who suggested that the company buy offline travel companies, use online information to attract tourists, and then let tourists accept the travel services of offline companies. Ctrip. Com was founded in 1999 and listed on NASDAQ in February 2003. Ctrip. Com made online to offline the earliest listing concept in China. It can even be said that Nasdaq first knew about O2O in China, and then it knew about e-commerce in China.
Like standard O2O, Ctrip.com has two parts, online and offline. The online "Destination Guide" covers nearly 500 scenic spots around the world, with more than 10000 scenic spots, including all-round travel information such as accommodation, transportation, food, entertainment and shopping. Offline provides members with all-round travel services such as hotel reservation, air ticket reservation and holiday reservation. Currently Ctrip. Com has more than 5,000 member hotels at home and abroad to make reservations, and it is the leading hotel reservation service center in China, with a monthly hotel reservation volume of more than 500,000 nights.
Except Ctrip and E Long, hotel reservations all adopt the pay-as-you-go mode, and only information flow occurs online, but no capital flow occurs. Green mango adopts prepaid mode, which is no different from current O2O.
Another mature application of "old" O2O in China's e-commerce is reservation service.
Kanbu.com was founded in the year when Ctrip.com went public. In 2007, it officially launched Kanbu.com's online platform. Through Kanbu.com, viewers can book movie tickets for 100 cinemas belonging to the National Movie Ticket Booking Alliance, and reserve seats in advance. Kambu Com integrates ticket ordering, graphics card recharging, entertainment information, theater location promotion and peripheral marketing activities.
And founded his own online entertainment brand _ Watch Step Entertainment. At present, this O2O service has covered the whole country 1 1 city.
Aircraft booking is another popular O2O booking service. China Southern Airlines took the lead in developing electronic tickets in China. Now that this service has become popular, each of us can book air tickets online and then go to the real airport to receive air travel services.
"Under normal circumstances, the cost of direct sales of Shenzhen Airlines through e-commerce websites is about 1/6- 1/8 of that of traditional distribution channels, so that we can save 80% of sales costs."
A related person from Shenzhen Airlines said, "There are nearly 7 million netizens in Shenzhen, 70% of whom have ordered online. This is the market cornerstone for the rapid development of civil aviation e-commerce in Shenzhen. "
2) What tangible products are suitable for O2O?
E-commerce is mainly composed of information flow, capital flow, logistics and business flow. O2O is characterized by online information flow and capital exile, and offline logistics and commercial exile. Most intuitively, those tangible products that can't be delivered by express delivery should apply e-commerce and be suitable for O2O. Music downloads, online videos and other products are difficult to play the role of O2O.
Alibaba used to test the online and offline of automobile products for the first time through the online goods fair. The organizer said: "Consumers spend an average of 18- 19 hours online before buying a car, researching car purchase information and related materials, accounting for 60% of the whole car purchase cycle. Many consumers still need some value-added services after buying a car. For example, they want to do car beauty but don't know where is the cheapest. They want to buy accessories, but they don't know the nearest place and want to buy them.
Uber is an O2O service, which has been well promoted in San Francisco. Uber allows you to download a private ride service application on your mobile phone. After sending a taxi request through this program, the service provider will track and locate the private car through GPS and let it drive to you in a few minutes; Payment and tipping are done automatically by credit card.
Similar to cars, it is suitable for O2O products and housing.
SouFun was successfully listed on the New York Stock Exchange on September 20 10, and it is an online and offline real estate home network platform. SouFun has more than 6,000 employees, and its network business covers 3 14 cities, with branches and offices in 86 cities in China. SouFun guides customers to conduct offline transactions such as new houses, second-hand houses, renting houses, villas, commercial real estate, home furnishing and decoration through online transmission of information.
Ye Wei, one of the 20 1 1 global 10 online merchants, loves my family and uses online to offline. Online, 5i5j.com, a popular real estate trading website, connects with five offline exhibition service centers, 800 chain stores and sales offices, covering more than 40 large and medium-sized cities, and further expands to second-and third-tier cities and emerging regions.
Love Day Rent provides O2O services, and its main job is to guide users to conduct offline transactions through online listing information. There are about 30 people in the ground handling team renting a house in Airi. The main job is to find high-quality housing. After judging the demand, the ground staff will find the housing and then contact the landlord to ensure that the offline resources are exactly what the online people are looking for.
On the surface, the advantage of O2O is that it is difficult for entities to move to online transactions, but in depth, it is not entirely true.
3) Information flow is good at creating meaningful value.
In the early days of e-commerce, it was a last resort to use only information flow. At that time, logistics and payment conditions were not available, and e-commerce had to use the website to carry out information flow activities. To become a deliberate mode choice, O2O needs to make a fuss about the advantages of information flow itself.
The advantage of O2O lies in creating meaningful value. The function of entity correspondence, the value of capital correspondence and the meaning of information correspondence. O2O has two important advantages, which are conducive to creating meaningful value and serving customers accurately.
First, let customers make meaningful judgments on entities and values to save transaction costs.
Whether a commodity is meaningful to customers determines whether it should be produced in entity and how much it should be produced; Decide whether it is worth it in value and how much it is worth. Theoretically, if we know the meaning, there should be neither redundant products nor insufficient products on the market. However, in physical commerce, the significance of accuracy to individuals is unknown, and physical shopping malls have to take more or less quantities to sell goods at higher or lower prices.
The advantage of information flow lies in that it transmits the information of physical performance and price of goods, and appeals to customers' choices and judgments, so that goods can move entities and values without consuming entities or values, thus avoiding invalid intermediate consumption. Therefore, meaning mining has become a stable technical and commercial advantage for the in-depth development of O2O.
From B2B to B2C, and then to O2O, this is a process from the increase of Internet users to the maturity of Internet consumption culture, and then to the prosperity of Internet business ecology. Mature O2O should make cultural efforts to make information flow more meaningful and actively create meaningful value for users in the process of grasping information flow.
The second is to give full play to the role of data and profoundly grasp the significance of customer recognition.
One of the insurmountable defects of physical store transactions is that user data is difficult to collect and analyze. Because users need to pay online from online to offline, payment information has become a valuable resource for businesses to dig deep into users' personalized information. Mastering user data can greatly improve the maintenance and marketing effect of old customers; Through analysis, it can also provide clues for discovering new customers, forecasting and even controlling passenger flow.
For O2O enterprises, the quantification of sales data is also a very important link. O2O can count and track every transaction through orders, which is difficult for offline merchants. about
For O2O companies such as OpenTable and SpaFinder, online settlement has become a more profitable business than local advertising. In the great cause of implementing O2O, I love my family. CRM contains millions of dynamic customer data and a mathematical model for analyzing customers' real estate consumption and investment trends, and always supports related research, real estate investment consultants and sales. The Group maintains contact and interaction with these customers through member clubs, so as to explore and meet the relevant needs of customers in a timely manner.
2.O2O as an experience provider
The greater potential of O2O lies in experience.
Toffler predicted 40 years ago that after manufacturing and service industries, the experience industry would be the direction of industrial upgrading. /kloc-0 0 years ago, this prediction began to become a reality in the world. Today's e-commerce is not satisfied with selling goods and services. Can it sell experience to get higher added value?
O2O is probably an answer. O2O is suitable for those experiential services that are accepted face-to-face and "personally". For example, meet friends in person, eat out in person, exercise in person, watch theater performances in person, and go to beauty salons in person. These services, which are especially suitable for in-store consumption, can't be completed online, and they all have the nature of experience. This is the stage for O2O to give full play to its advantages.
From a macro perspective, in the next five years, China's service industry will account for more than the manufacturing industry. There is even a view that "if the online sales of goods packaged in boxes are sent to consumers is 500 billion, then the online sales of life services will reach trillions." O2O will promote the transformation of e-commerce from selling goods to providing services and experiences, and will also conform to the trend and improve the position of e-commerce service industry in industrial chain and value chain.
Second, from the business model:
What's the difference in the way O2O does things?
According to the division of basic sales types by Reikham and Devon Sentis in Revolution of Sales, we divide O2O into transactional sales (corresponding to Porter's cost-leading competitive strategy) and consulting sales (corresponding to Porter's differentiated competitive strategy), so as to see the advantages and disadvantages of O2O.
Transactional O2O Sales Model: Advantages and Disadvantages of Group Buying
Groupon online group buying is an outstanding representative of the rapid development of online and offline in China.
From the competitive strategy, group buying can be classified as cost leadership, which is a business model based on price war. Its outstanding advantage is reflected in the discounted sales in transactional sales, which is suitable for opaque and profiteering fields in domestic industries at present.
Group purchase O2O pushes the news of offline stores to Internet users through discounts, information provision and service reservation. And organize them to make group purchases, thus turning them into offline customers.
Transactional sales have two characteristics. First, the products are homogeneous. If you buy a group, the products can't be too different. Second, the price is almost the only focus of the transaction. This is fully reflected in group buying.
There are some special problems in buying O2O: First, it is more difficult for O2O to pay first and then defend its rights. If the offline service quality on the O2O line is difficult to be controlled by a third party, how to coordinate in the event of a dispute in the future will be a test for all parties. Compared with the more flexible way of coupons, there is obviously no advantage. Secondly, for the price, if the offline price is the same as the online price, customers will think, why don't I just go to the store to see the goods and decide whether to pay or not to buy them; If the offline price is inconsistent with the online price, the store will weigh the offline customer traffic or the online customer traffic to decide who to offend and attract. This brings some uncertainty.
The biggest constraint of the transactional O2O sales model is that once the market has passed the extensive period, the profit will be gone. So it is only suitable for a wide range of markets with huge profits.
Consulting O2O Sales Model: Strengthening Brand, Advertising and Experience
Consulting sales is contrary to transactional sales, and its core is not cost but profit. The principles of consulting sales include: products or services are different from competitive products; Products or services are subdivided or customized according to customer needs; Customers do not fully understand how products or services provide solutions or add value; Products or services should make people feel customer-centric; Higher cost of products or services is reasonable.
Fujian Qipilang Industrial Co., Ltd., which aims at "O2O linkage", was originally a traditional clothing enterprise with more than 3,000 offline stores. Since last year, it has started online marketing. According to Chairman Zhou Shaoxiong's prediction, the proportion of online retail revenue will reach 65,438+00% this year. According to the company's revenue scale of 265.438 billion yuan last year, the e-commerce business will exceed 200 million yuan this year.
Seven wolves' marketing strategy is based on product differentiation and service differentiation. In order to avoid homogenization, the seven wolves adopted a differentiated marketing approach. In terms of products, the seven wolves distinguish the same products by marketing methods, and the same marketing methods distinguish them by products. For example, if there are 50 T-shirts with sales exceeding 800, you need to distribute the styles to various dealers. 20%-30% products from different stores are differentiated; In terms of services, distributors are divided according to the seven basic points of e-commerce and differentiated services are carried out.
In addition, online to offline has the advantages of satisfying consulting sales in three aspects: brand marketing, advertising marketing and experience marketing.
1) Strengthen online brand promotion.
Zhong Tao, the new e-commerce director of Fujian Seven Wolves Industrial Co., Ltd., made it clear that the strategic planning goal of Seven Wolves e-commerce is "O2O linkage". The first thing to be achieved is "brand e-commerce", which uses O2O to strengthen the brand of enterprises on the Internet, thus driving offline sales.
2) Create an advertising effect through O2O
Because O2O promotion can get accurate feedback effect, it is very attractive to businesses compared with general advertisements without targets.
For O2O, it is easy to judge the effect of online promotion because the order is placed before entering the store. From a business perspective, joining O2O is equivalent to targeted advertising promotion. Wu Bo, CEO of Handan.com.. Com believes that O2O is particularly effective in promoting new products and many new stores.
3) Create a good online experience
O2O online service itself can provide a good user experience through information.
20 1 1 Shangpin ZJS, one of the top ten online merchants in the world, attaches great importance to online experience in the process of promoting online to offline. Shangpin ZJS mainly provides customized home business. Online provides a good visual experience, such as video and 3D images. Interested users began to go offline step by step. First, the customer service phone confirms the information. Then senior designers come to the door to design measuring ruler for free, and provide furniture matching renderings and quotations for free. Then, they made an appointment to see the plan in the store and experience the real thing. After they are satisfied with the plan, they place an order and enjoy preferential discounts.
At this year's online business conference, I saw the demonstration of Shangpin ZJS, and I was very shocked. People in Beijing say that they will customize their homes in the future, so they are looking for this. It can be seen that O2O is effective in enhancing the experience.
Looking forward to the future development of O2O, mobilization, localization and socialization (that is, investor john doerr put forward the concept of SoLoMo at the beginning of 20 1 1, that is, the combination of socialization, localization and mobilization) are becoming its trend.
Grubwithus is the best example of combining SoLoMo concept with O2O. It is a good combination of online ordering and offline socialization, and it is even more powerful if you add the coupon distribution in LBS mode (you can get the coupon online by "signing in" on your mobile phone and redeem it in a physical store online). The Americans tried to introduce the Grubwithus model into China, but failed as usual. Obviously, Americans don't understand China's dinner culture.