O2O and Indonesia's E-Commerce Scene

We are seeing a new shift in purchasing behavior, from offline to online (O2O). This has led to many retailers, whether it’s Neiman Marcus in the U.S. or Myer department stores in Australia, which all have their roots as traditional retailers with brick-and-mortar stores, now focusing on branding, digital marketing strategies, and omni-channel opportunities for generating new business.

For consumers O2O offers opportunities to try in-store but buy online for better prices, or the inverse, buying online and picking up in-store. It can all happen depending on the product characteristics.

This O2O trend is also starting to take off in Indonesia. Online stores that normally sell their products using social media platforms are now beginning to open up pop-up stores with other online stores in retail malls to create new O2O channels.

The rise of the O2O journey in Indonesia is based on the belief that the future of online is offline. Instagram store @pepperplum is selling gadget cases. It has started joining pop-up events in Indonesian shopping malls in Jakarta. Another example, Puyo Silky Desserts, a successful online store selling silky jelly, is expanding its business by joining several pop-up store events and now has several permanent outlets at major malls in Jakarta.

There are many event organizers, especially in Jakarta, offering opportunities for online stores to go offline, but before deciding to go offline, owners should prepare their O2O strategy and ensure their online store is already profitable.

Going offline is a big step, and store owners also need to understand consumer behavior – researching on one channel and buying on another. A successful O2O strategy starts with a store owner’s ability to truly define and promote their in-store value, giving consumers compelling reasons to come in store, based on consultation, customer service excellence, or research and education. By defining, offering, and promoting offline services that cannot be delivered online, followed with Web and social media promotion channels, owners can dramatically improve offline customer experiences and most crucially generate increased revenue.

Stores also need to stand out from the clutter to be successful, as poor offline buying experiences will impact online sales and vice versa.

It is important to optimize sales and retention through the integration of both online and offline platforms. There are many ways online retailers can integrate both platforms and make the offline experience a great success.

Getting consumers to offline stores is about more than having just a pop-up store presence, but also including on the online platform all the relevant details, from phone numbers to driving directions. Coupons and promo codes on the online platform can be used to track referrals and attract customers to visit pop-up and offline stores.

Incentivize buyers to join an email list by offering a loyalty program and then sharing useful and entertaining content.

Online and offline shopping experiences are going to merge more and more, especially as O2O strategies are advanced with new technologies including QR codes, mobile technology and augmented reality apps, and seamless management to empower offline businesses to reach more target users.

Online and offline can enhance customer loyalty by providing new shopping experiences to customers, collect data flows for CRM strategies, and improve overall total sales revenues.

This trend in Jakarta will be followed by other cities in Indonesia. While e-commerce certainly is not going anywhere, start-ups in this sector should be thinking about how their business model is going to adapt to this change from the very beginning and what strategies and technologies they can choose for greatest success.

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