O2O Meaning: Online to Offline

By
Joshua Weatherwax
Table of Contents
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    We are living in an online world, as evidenced by eCommerce growth, and physical stores have to adapt to survive. Unfortunately, many brick-and-mortar stores have trouble competing against different types of eCommerce businesses.

    That's where eCommerce marketing comes into play. Using O2O marketing is the key to increasing sales and attracting new customers to your location.

    Here's what O2O marketing is, how it works for different types of online retailers, businesses, and some best practices to help you make the most of it.

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    O2O Channel

    O2O commerce can be performed using any digital marketing channel. These can be social networks, Google Ads, or emails. The key is to use the channel that most fits your target customers.

    The most commonly used digital marketing channel, and the most successful for O2O commerce, is eCommerce email marketing. Prospective customers are targeted based on their distance from the location and incentivized through promotions and discounts to shop in-store. This also happens through the company loyalty program. Such programs, like a restaurant loyalty program, target repeat customers.

    O2O Example

    If O2O marketing sounds a little confusing, here's a quick example to show you how it works.

    Let's say that you run a local food wholesale business. Lately, customers have been shopping with your competitors online and you're looking to draw them back. Since you’re not using eCommerce software to sell online, you use email marketing to send a promotional discount to your customers that can be redeemed in-store. This increases your sales and helps you compete against your digital competition.

    Another common example is when an existing online company acquires physical retail industry businesses. This happened with Amazon's purchase of Whole Foods Markets. It allows both locations to benefit. The physical business benefits as the online company already know how to use eCommerce marketing and eCommerce SEO to attract customers. The online company benefits because it expands its portfolio and can increase revenue in new areas.

    O2O B2B

    O2O marketing can be used by a B2B business to help attract prospective customers and generate leads. Unfortunately, many B2B companies are falling behind as the world shifts to digital shopping. Adopting an O2O commerce model can allow B2B businesses to compete with online wholesalers, like B2B eCommerce companies, and even expand into the direct to consumer market.

    One of the best ways for B2B businesses to shift sales online is by using an online marketplace like BlueCart eCommerce. This all-in-one solution handles online store design and structure, menus, payment processing, and more. It also has an integrated email marketing function that lets you send promotional emails directly to your customers. Whether selling online or in person, BlueCart can help.

    O2O Marketing Definition

    Online to offline (O2O) is a digital marketing term that refers to using online marketing to drive consumers to make purchases at brick-and-mortar stores. O2O marketing is a merging of modern digital marketing practices and traditional brick and mortar store sales.

    O2O commerce is an industry that is currently valued at nearly $1 trillion. This is because, according to Bloomberg, half of all U.S. businesses don't sell products or services online. In fact, more than one-third of U.S. businesses don't even have a website. That means they need to use O2O marketing to attract customers to their physical location.

    O2O Online to Offline Commerce Best Practices

    Like all kinds of marketing, O2O marketing needs to be done in the right way to achieve the best results.

    Here are four best practices for O2O commerce:

    Research Your Market

    Don't just throw money into online marketing without first researching your niche market. You need to understand what marketing channels your audience prefers, how often they want to hear from their favorite brands, and more. This is a major step in any successful eCommerce marketing strategy.

    The information gathered here will give you insight into the best places to invest your energy and money. Don't be afraid to include prospective customers who are slightly further away than your usual customers. There may be an opportunity to gain a foothold in a new market and show you can better meet their needs.

    Use Email Marketing

    We can't stress enough how valuable email marketing is. It has the highest return of all marketing and business analytics tools. It's a great way to send promotional messages to your customers or just remind them that you're around. It is also fairly low cost and easy to learn if you use an online email service.

    One of the best things you can do here is to invest in eCommerce marketing automation. It will let you send automatic emails to new leads and get them to shop sooner. It also lets you target different groups of customers with different messaging, improving the chance of a sale.

    Be Adaptable

    Many brick-and-mortar businesses find it difficult to make any shifts to the online market. Growing your sales and competing requires you to put that aside and take advantage of new technologies. Try to stay current on industry trends and serve your customer's marketing materials in the manner that they prefer.

    Such industry trends include coffee industry trends, restaurant industry trends, produce industry trends, food trends, DTC marketing, and eCommerce trends. By staying on top of these, you’ll be able to strengthen your demand planning techniques and ensure you offer what your customers are looking for.

    You will also need to remember that not all marketing efforts will work, nor will they drive results right away. Feel free to try out different channels to see what works best for your business. You should also speak to your customers and see what they prefer. 

    Follow the Data

    One of the best things about eCommerce marketing is that it gives you real data on customer trends. You can find out how many people opened your email marketing, how many clicked through, and more. This data is invaluable and will let you set eCommerce KPIs, establish demand forecasts, and create better marketing material. 

    Use the data you accrue to perfect your efforts and increase eCommerce sales and in-store sales. Familiarize yourself with social media ROI to see how your online marketing efforts are performing. First, you must understand the ROI meaning and how to calculate ROI.

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    O2O No You Didn't!

    O2O commerce is a vital tool for the continued success of offline retail businesses. It allows you to compete and reach customers using online space technology. Follow the tips above and use the right digital marketing channels to grow your business.

    Frequently Asked Questions About O2O and O2O Meaning

    O2O marketing is a powerful mechanism for driving sales, despite how infrequently it’s used. Learn more about O2O and how to use it effectively with our answers to common questions below:

    Is O2O an Omnichannel?

    Online to offline, or O2O, is not considered an omnichannel sales method. Where omnichannel efforts are designed to integrate various sales channels into one buyer experience, O2O is specifically designed to incentivize online sale shoppers to complete their purchases offline. 

    O2O marketing uses digital marketing tools to prompt customers to finish a purchase in a retail environment. An example would be a social media video ad that talks about an in-store flash sale, or an email subscriber getting an exclusive discount that can only be redeemed in person. 

    Why Is O2O Important?

    O2O marketing is important for several reasons. One, O2O is an inexpensive way to drive reliable offline sales through online methods. If you have a small dessert shop or clothing store, you don’t need the marketing budget of a large retail chain to be successful. You simply need to use existing digital tools to drive higher engagement and more foot traffic. 

    Two, O2O allows you to exponentially grow your profits while keeping your expenses low. An email subscriber list of 9,000 people can be used to achieve excellent revenue. If you send out a promotional code that can only be redeemed across a three-day period, you’ll see your in-store traffic spike for those days. Email service providers have low monthly fees, but by encouraging people to come to your store, you can make thousands more dollars with little effort.

    Which Stores Are Known as Offline Stores?

    An offline store is any retailer that sells goods at a brick-and-mortar location, or uses O2O marketing methods to drive in-store traffic. Here are some of the most popular offline store brands: 

    • Glossier (skincare and beauty products)
    • Bonobos (upscale menswear)
    • Casper (mattresses, bedding, and pillows)
    • Madison Reed (hair care and coloring products)
    • Warby Parker (glasses and eyewear)
    • Farfetch (luxury fashion wear)
    • Zappos (shoes and clothing)

    What Is the O2O Marketing Definition?

    The O2O marketing definition refers to the use of special techniques that incline online customers to make purchases at brick and mortar stores. An example of O2O marketing is when online customers see an ad on the internet or on social media then visits a store to make a purchase. 

    These marketing efforts may enhance the shopping experience for potential customers. It brings them in-store and allows them to discover in-store perks. These include loyalty programs with QR codes and in-store-only discounts. 

    What Is an O2O Example?

    An O2O example would be if a customer is shopping on a retail website and likes a product, then goes to the brick and mortar store to purchase it. The sale originated online, but was completed in-store. This makes it an Online to Offline transaction. 

    Customers start their orders online and complete them in-store are prime examples of this method. O2O strategies and O2O retail efforts focus on getting customers to make purchases in person. It’s a common business model for online channels.

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