Paytm Adopts O2O To Win Customers

Online marketplace Paytm E-Commerce Pvt. Ltd, which runs Paytm Mall, is looking to tap its offline customer base at brick-and-mortar stores with an online-to-offline (O2O) strategy.

The company, majority-owned by China’s Alibaba Group Holdings, is also pushing a quick response (QR) code-based system on its recently-launched app and website.

Customers can now shop from Paytm Mall by scanning the QR code given by the online marketplace to its offline merchant partners, a company statement said. To start with, the firm has struck a partnership with electronics giant Samsung wherein brick-and-mortar retailers will sell the brand’s phones for a commission. More fashion and electronics brands, among other categories, are likely to be on-board soon.

Amit Bagaria, vice president, Paytm Mall, said, “We aim to create an offline network as a platform for brands, thereby optimising the supply chain and marketing expenses on their behalf. This platform will also be beneficial for partner merchants enabling them to grow their business and garner additional revenue. This will bring additional high footfall to outlets without keeping the inventory.”

Last year, Noida-based One97 Communications Ltd separated its e-commerce and payments businesses as Paytm E-Commerce and Paytm Payments Bank Ltd. Last month, Paytm E-Commerce received a funding of $200 million from Alibaba and venture capital firm SAIF Partners.

The O2O model uses a smart mix of internet advertising, QR codes, online payment, offline pickup and hyperlocal listings to nudge the online shopper back to the real shop. The strategy has often been dubbed as the next big thing in India’s rapidly evolving e-commerce space.

In 2015, the market saw several brands up their O2O bet, with several startups focused on the model coming up. In fact, India’s largest digital wallet player Paytm acquired online marketplace for hyperlocal services, in December 2015, to strengthen its presence in the space.

In November last year, Paytm acquired O2O startup Shopsity to strengthen its offline retail network.

Question for yourself if you’re a business owner: Are you pondering on a change from the traditional business model to O2O?