CHAPTER 3: RESEARCH METHODOLOGY
3.1 R ESEARCH M ETHODOLOGY
To fulfill the research objective of evaluating the CSFs of implementing O2O promotions, this research plans two stages of empirical study. The first stage is to build a preliminary finding about the five major types of O2O
business modelsand the CSFs of O2O
business models based on the previous literature and more than fifity case studies (see APPENDIX 1). The second stage is to conduct in-depth, selected case studies (five promotional O2O projects), as shown in Table 6, across a range of industries in Taiwan. The reason for focusing on promotional O2O is that promotional activity is very important to business processes. Enterprises like to use O2O business models— e.g., providing coupons and promotional information via smartphone apps, online catalogues, online websites, and social networking—both to reach new consumers and to provide promotional information. Due to increasing competition among companies, promotional methods have become more innovative and creative.
The criteria for successful O2O projects
To offer broad and accurate information of critical successful factors in O2O project implementation to business, this study conduct in-depth interview with experience project participants from different companies and select five successful representative O2O project. Therefore, how to measure "a successful O2O project "?
According to various case studies, we generalize two measurements: (1) An increasing traffic both online and offline and (2) Sales both online and offline go up.
Based on the definition of O2O in this study, firms provide a variety of services through online channel to touch broad online visitors. More and more visitors come into the website or download mobile app to get more information. The online visitors are encouraged to offline store or experience offline services via online information.
It leads the revenue in offline store to go up. The more online visitors convert into customers in store, the more revenue prop up.
5 selected promotional O2O projects
The O2O business model has grown more popular internationally. Several Taiwanese companies are enthusiastically following this trend. Following successful measurements, we selected the five companies below as interview participants.
Yahoo Taiwan chaoji shangcheng ecommerceYahoo chaoji shangcheng ecommerce was founded as a marketplace for business e-commerce and has collaborated with approximately 4,000 online and offline stores. To increase their users and improve customer shopping experiences, Yahoo Taiwan developed an app called the "chaoji shangcheng ecommerce app."
The app utilizes LBS technologies that promote customer coupons offered at nearby stores, and the app "scans and buys services" to allow customers to make quick purchases via chaoji shangcheng ecommerce by scanning product barcodes in offline stores. Shoppers need not carry a heavy bag while shopping and can easily compare product information using the app. According to the report and according to our panelist, the Yahoo chaoji shangcheng ecommerce app successfully enables the company’s physical partners to attract more customers through the provision of coupons, substantially increasing revenues.
McDonald’s Surprise Alarm appMcDonald's sales have declined over the past few years in Taiwan. To boost its sales, McDonald's researched daily customer habits and found that few Taiwanese eat breakfast daily due to busy work schedules. McDonald's thus cooperated with TMS research, which specializes in market research, business intelligence, data analysis and strategic consulting; Leo Burnett Taiwan and DDB Group Singapore, which are marketing agencies known for digital marketing, advertising, and marketing campaigning; and elite figures from other countries in launching the Surprise Alarm app project. The mobile app became an established tool that people used to complete numerous tasks, and the alarm clock was a very popular feature. The app sends users a prize once daily upon waking up from the app alarm clock. A few months after its introduction, the Surprise Alarm app achieved over 420,000 downloads and had given out over 5.9 million “surprises.”
Taiwan Shin Kong Mitsukoshi Department storeThe Shin Kong Mitsukoshi Department (SKM) store is a well-known chain department store in Taiwan. When a surge of customers arrived at store locations on Anniversary Celebration day, coupon and reward points exchange activities offered at store counters could not operate efficiently. Last year (2014), SKM introduced the SKM app to make customer shopping experiences simpler and
more convenient. Shoppers can collect coupons through the app without waiting in a long line. This year, SKM instituted beacon aware -location technologies in stores that connect to mobile apps to allow shoppers to accurately receive product messages upon approaching a beacon in a store. A shopping -tour app function was designed to help customers create personal shopping routes to their favorite brand stores, restaurants, etc. Recommendations are sent to shoppers' mobile phones, encouraging shoppers to make purchases while on shopping -tours and upon viewing real-time promotional messages. SKM has collected and analyzed customer data from this app to better target customer needs and to deliver the most relevant messages at the appropriate times.
Taishin Mobile Bank appThe banking industry in Taiwan has undergone intense processes of competition for a long time. With the rise of O2O trends, most have started to integrate online and offline channels. The Taishin Mobile Bank app was created to serve both banking and marketing operations. On the banking end, the app provides services that have traditionally been delivered offline (e.g., payments, money deposits, fund transfers, etc.), and on the marketing end, the app integrates financial products into customers’ daily lives, providing information and coupons on entertainment, food, travel and resort packages. Taishin Bank also cooperated with more than 2,000 FamilyMart convenience store branches where Taishin ATMs are located. The "I-promotion" function of the app presents coupons offered by Taishin Bank's physical partner. "I-check in," a new function developed this year, uses beacon technologies to offer users real-time messages on the stock market, account interest rates and credit cards, when users enter a Taishin Bank branch. Taishin Bank collects and analyzes customer shopping behaviors to formulate more valuable financial services for customers. Taishin Bank has improved its services to facilitate seamless banking experiences for bank members and the public.
FamilyMart convenience storeWiki statistics show that the number of convenience stores in Taiwan exceeded 10,000 in 2015. Four major convenience store brands have aggressively improved
their services and strategies to attract more customers. FamilyMart, one convenience store brand, has made an effort to understand O2O strategies and has developed both online (app, online website and social networking site) and offline (Kiosks and ATMs offered through Taishin Bank) technological applications. The FamiPort app, one of tools created to complete the O2O business model, provides services initially offered through convenience stores (e.g., ticket bookings, reward point exchanges, and delivery services). The app includes an online shopping option that allows customers to browse through a wide variety of products and coupons and to obtain product barcodes. A transaction is completed after a store clerk scans a product barcode. From these constant service announcements, FamilyMart has grown to be comparable to the leading convenience store brand 7-11.
3.2 Research Process
We first describe online and offline O2O projects, the proliferation of the O2O business model and the various types of O2O business models. We then present effective strategies for O2O implementation. Identifying critical factors of O2O implementation success requires broad and in-depth data collection and analysis.
We use a promotional O2O business model to thoroughly explore CSFs in O2O implementation. In collecting and thoroughly examining a broad range of data, we employ the Delphi method to determine ways to effectively implement O2O projects. We thus collect a wide variety of information via in-depth interviews with experienced businessperson.
The Delphi method is a systematic, interactive process to elicit a consensus view with a group of experts. Forecasting, an important application of the method, used to investigate the factors that influence decision-making on the specific issue, topic and problem. Delphi method used to gather a panel of experts to generate a more accurate and more informed result.
Table 6 Promotional O2O business model case studies in Taiwan
Company Industry O2O project Project description Vision
Yahoo Taiwan Retailing chaoji shangcheng ecommerce app
超級商城app
The app utilizes LBS technologies that promote customer coupons offered at nearby stores, and the app "scans and buys services" to allow customers to make quick purchases via chaoji shangcheng ecommerce by scanning product barcodes in offline stores. It helps shoppers save time and energy without carrying heavy bags. LBS shopping also help customers quickly find a product with special prices near users' location. online and offline and transaction across countries.
McDonald's Food Mcdonald's surprise alarm app
麥 當 勞 早 安 app
McDonald’s has always been a popular fast food in Taiwan. Due to the high profitability of McDonald’s breakfast offering, its marketing outsourcing team developed a consumer-attracting app that connects to an alarm clock. This app dominated popular app lists in 6 weeks and increased McDonald’s revenues. smartphone when they wake up.
Taishin Bank 台新銀行
Banking Taishin Mobile Bank app
Taishin Mobile Bank app provides both banking service to their clients and marketing service to public. The app also combines with beacon installed in branches of bank to send finance message to users, and branches of FamilyMart to offer product information with special
To deeply data to do analysis.
price. To raise service convenient and friendly environment to shoppers. It offers various type shopping-tour that shoppers experience shopping as an enjoyable trip. Shoppers can receive the brand messages at the stores where beacons installed there for precise targeting of shoppers.
Shin Kong Mitsukoshi Department store expect to create a new shopping culture, shopping tour with product
recommendation and social network to make shoppers enjoy coupons, including food, travel, entertainment and so on, to customers. Once the users order the coupons, the app produces a barcode for scanning and payment.
To have more competitive advantage to win in the convenience store environment (eg 7-11, Hi-Life and OK) and offer any service to satisfy consumers.
Participants are encouraged to give their related experience but subject to interact with other participants to reduce the influence of dominant individual (MacCarthy and Atthirawong, 2003). One of important aim of this study was to develop a list of CSFs for O2O implementation and understanding the situation that probably occurred in O2O project from experienced participants. The Delphi method enables a clear set of answer to be established. There are four steps to establish the research. The steps are explained in Table 7