By Selangor Journal Team
SHAH ALAM, Oct 15 — There is no single solution for retailers seeking to integrate their business with online-to-offline (O2O) commerce.
Panellists on the 5th Selangor Smart City and Digital Economy Convention 2020 shared different strategies for their retail businesses that range from being seamless to going retail from online and to become a late adopter to online.
Online-to-offline (O2O) commerce is said to be a business strategy that draws potential customers from online channels to make purchases in physical stores.
Senheng executive chairman and founder Lim Keng Heng said the country’s largest consumer electronics retail chain store in Malaysia since 1989, with 104 stores nationally, was early to adopt online business but never really capitalised on it.
“We first went online store in 2005, like everybody we made mistake and put up a product make it attractive but it does not work. Ten years later we discovered our overall sales dropped, our traffic dropped, the traffic went to other e-commerce platforms and all our effort to get the traffic back failed.
“We discovered the hard way that pure offline retail is dead so we went to Ali Baba business school to learn about a new retail business called ‘seamless’, which caters to customers’ preferences,” said Lim during the “O2O Commerce: The Next Face of Retail” virtual session today.
He said seamless business model, which covers online, offline, logistic and big data, works for them, and in 2017, their sales and traffic returned and saw the growth in sales of 26 per cent in 2018 year-on-year with RM1.2 billion sales.
Siti Khadijah executive director Mohammad Muhaimin said the premier telekung (prayer outfit) company had tried to sell in wholesale first to travel agencies for umrah and haj performers. He said this had forced them to go into retail but like all businesses, they had retained its website for online presence.
“In ten years time from our first store in Bangi, we now have 35 stores in Malaysia and four stores in Indonesia. Our website is just there with no investment in it until the last couple of years after (e-commerce platforms) Lazada and Shopee came in, we discovered our target market of women aged between 25 and 40 years above are more interested to buy online, so we invested in online shopping platforms and in our website,” Mohammad said, adding that the move helped in merging the O2O business model despite the challenges faced during the Covid-19 pandemic.
Meanwhile, the session saw the panellists in agreement that retailers must maintain the product prices to give a similar experience to buyers.
Both Lim and Mohammad revealed how they used Facebook and Google in understanding more on their target market by merging the big data collected from their customers with the social media giants.
Lim cited the use of data collected from its loyalty programme to find similar customers that cater to their market as an example of using big data in understanding market trends.
To sum up the session, the moderator and panellists had agreed that retailers need to stay resilient and adaptable as well as continue experimenting in finding the most suited business model.
Moderating the session was Syuen Zens Resources and IT Comp Sales Services Sdn Bhd founder Sharon Goh with Kait Lifestyle Store founder Sheryn Chin as one of the participating panellists.
