The new challenge of the O20:
Just like Amazon Go freshly introduced with its disruptive and connected experience, Asia, and especially China, also advance these pawns in the field of O2O (Offline to Online or Online to Offline). Two years ago, Alibaba invested $ 692 million in a Hangzhou shopping center operator (21 million people) to provide the benefits and convenience of online service in physical stores. As recently as August 2015, Alibaba invested $ 4 billion to take 20% of Suning, a leader in consumer electronics distribution with 1,600 stores. Suning and Alibaba launched a $ 700 million investment in June 2016 to encourage and promote online and connected services to the public. With e-commerce accounting for only $ 630 billion and 13.5% of China’s total retail, both companies see an interest in motivating awareness. Suning’s physical network supports this development. Thus, the 5500 customer service centers already welcome customers of Tmall, Alibaba’s B2C platform.
Alliances, however, do not seem all conclusive. Wanda (the first Chinese real estate company), Tencent (WeChat) and Baidu (search engine) proudly announced a generously funded $ 815 million JV to launch the “ffan.com” platform to connect WeChat and Baidu technologies with shopping malls of Wanda. Unfortunately, two years later in August 2016, Tencent and Baidu leave the ship. WeChat houses a shopping platform within its application. According to a McKinsey Digital study (iConsumer China 2016 Survey), 31% of 750 million WeChat users use it in 2016 to shop. A figure up 100% from 2015.
Alternatively, CapitaLand, the largest Singaporean real estate company in the region, has set up a $ 70 million investment fund to invest in Retail Tech start-ups.
It would be good to see the completion of an alliance project of tech giants and shopping malls and see the emergence of synergies to develop the shopping experience and customer satisfaction. It is time to see situations where investments come to create a real omni-channel between the platforms through a multi-device and multi-environment content (in-store), analytical tools to parity between the two worlds, a customer service that really accompanies the customer throughout his buying experience and not just after. Amazon arrives with good weapons in the region and could well be the actor who knows how to make ends meet.