Leveraging O2O commerce for product promotion : an empirical investigation in mainland China

Phang, Chee Wei and Tan, Chuan Hoo and Sutanto, Juliana and Magagna, Fabio and Lu, Xianghua (2014) Leveraging O2O commerce for product promotion : an empirical investigation in mainland China. IEEE Transactions on Engineering Management, 61 (4). pp. 623-632. ISSN 0018-9391

Abstract

This research investigates how retail businesses may promote their products online to induce offline sales via social media-enabled online-to-offline (O2O) commerce. We focus on a country context where such an emerging e-commerce model is particularly prevalent, i.e., China. Key to leveraging this model is to attract consumer attention and stimulate their actions both online and offline, which may be achieved through information technology (IT)-enabled promotional approaches, such as administering banner adverts and digital coupons. The former focuses on communicating product attribute information, whereas the latter focuses on communicating incentives. Building on a collectivism cultural perspective, word-of-mouth (WOM) communication motives framework, and digital advertising literature, we hypothesize their different effects online (generating produce review) and offline (inducing sales). We first conducted a survey comparing consumers in China with their U.S. counterparts, and show that a cultural perspective is pertinent and valuable. We then collaborated with China's largest O2O social media website for restaurant reviews, and conducted a field investigation of consumer responses to the two promotional approaches. Our findings afford important insights for retail businesses seeking to leverage O2O commerce, and provide research implications to the areas of e-commerce and digital advertising.