Why O+O is Becoming the New Standard for Retail Industry
Why O+O is Becoming the New Standard for Retail Industry

O+O (Offline plus Online) describes how customers shop today. The customer journey almost always involves offline plus online. The traditional strategy of O2O (online to offline or offline to online) from the past generation drove customers from one channel to another; however, O+O is totally different. It is more about creating an integrated experience to better serve customers’ needs that enables them to shop across any channel, anytime, anywhere.

“Forget physical versus online. It's not either-or; O+O is the new standard for retail.” Malina Ngai, Group COO of A.S. Watson Group & CEO of A.S. Watson (Asia & Europe), explained how O+O becomes the new standard for retail and shapes the future.

“The motivation behind driving and delivering this new O+O standard is clear, there is no cannibalization in customers' spending in physical stores. In fact, O+O customer spends 3 times what instore-only customer shops with us. It's about creating a bigger share of wallet and higher customer lifetime value,” Ngai explained.

Customer Connectivity is the Centerpiece of O+O

With over 16,000 physical stores and 100 eCommerce platforms in 27 markets in Asia and Europe, physical and online stores are the perfect leverage for the A.S. Watson O+O model.

O+O Becomes the Standard for Retail

Ngai elaborated, “To be able to deliver O+O with excellence, it's a combination of our extensive physical store network as core touchpoints, our 140,000-strong customer service workforce, integrated with digital platforms, and most importantly, the customer connectivity with our base of 139 million loyalty members we’ve built over the past few years.”

“The new O+O standard is not about having physical stores and also an online store. It’s an ecosystem that is powered by technology, big data, and artificial intelligence. Just as important, it’s an organization cultural change when it comes to managing the business and prioritization.”

All of the group’s physical stores are connected to digital platforms, meaning the product offering is never limited by shelf space. In a few clicks, store teams can order products for delivery or pick-up by customers. Our loyalty members are also digitally connected with social media and digital platforms, so they can shop online not only on A.S. Watson’s mobile apps and websites, but also via WeChat, WhatsApp, and phone.

Technology-Enabled Shopping Experience

Ngai added, “Over the last 12 months, O+O has become more important than ever in terms of keeping customers engaged and ensuring a seamless retail experience. We doubled our development of digital assets and content to keep our customers engaged. We doubled our fulfillment capacities to cope with the surging demand through picking in stores, which enables us to deliver within hours which are what customers need.”

O+O Becomes the Standard for Retail

When it comes to the shopping experience, nearly all digital tools implemented are for O+O. “Customers of all generations are now increasingly mobile-savvy and digitally connected. The experience we developed focuses on using customers’ own mobile phone to align with customer habits.”

Retail is not Dead. It Just Needs to be Better

Ngai reinforced, “Converting more customers to O+O members will be our core growth strategy in 2021 and beyond. We will be laser-focused on customer lifestyle and their expectation on the shopping experience.”

“Physical stores will continue to play a significant role in creating our unique O+O experience. While some companies decide to disinvest in stores, we plan to open 1,000 new stores this year. Retail is not dead; it just needs to be better for our customers.”

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