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Online-to-offline (O2O) commerce, a broad category of purchase activity where consumers order and pay for products and services digitally that are then fulfilled physically, is growing in China. This is putting more pressure on retailers as they try to adapt to consumers’ increasingly mobile-focused purchase habits and higher expectations.
One area where the shift toward O2O activity is changing consumers’ activity is their use of mobile devices when shopping in physical stores. According to a February 2016 study by JDA and Centiro, of digital buyers in China ages 18 to 64, nearly 60% of respondents said they used their mobile devices in-store to check and compare prices, while almost half also used their phones to read product and service reviews.
The rising consumer expectations created by O2O services also mean retailers in China are facing customers with less tolerance for errors. The same report noted that quality issues and unmatched items were key issues that would make digital buyers in China less likely to shop with a retailer in the future.
As more retailers in China recognize the shift to O2O commerce, mobile payments and mobile shopping, many are attempting to cater to tech-savvy customers by offering “click-and-collect” services, where digital shoppers can buy online and pick up their purchase in-store. Yet buyer adoption of the services remains fairly low. According to JDA and Centiro’s report, 85% of respondents were aware of such services, but only 34% had used them in the past 12 months.
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