As early as 2010 when Alex Rampell first proposed the term O2O (Online-to-Offline), nobody predicted the rocket-fast development of O2O commerce in China over the following decade.

Today, with many offline brands getting online with an aim to share a slice of the big cake that is the e-commerce industry, people realize O2O also means offline to online. It works both ways, which means you could win a bigger slice if you master the skills and techniques behind this commerce trend.

A healthy supply chain matters a lot for a brand’s development. To a coffee producer or brand, the same rule applies. When a coffee origin becomes more accessible, the consumer end is something that many brands work hard on in a bid to further promote their products, especially online.

Fresh Hema, a new retail arm under Alibaba, is known for its online and offline integration. The brand now serves as an offline portal for online coffee brands to reach a number of potential consumers. “The comprehensive business system within Alibaba allows us to help online coffee brands or traditional coffee giants like Nestlé to improve the supply chains, ‘locating’ the targeted potential customers,” shared by Will Tu, food merchant operation adviser of Tmall Business.

If you pay attention to the domestic coffee market in China, you will find a series of new products and programs launched by Nestlé in the past years. It is a great example of embracing the New Retail as Nestlé was awarded for organization transformation at the Alibaba ONE Business Conference last month. Backed with strong Internet technologies, the 80-year-old brand manages to find its second or third curve of growth in China, a market that it has been in for over three decades. “By working with our Innovation Center, Nescafé released its Fruity Iced Coffee series last May,” said Tu. The new instant coffee, available in three flavors, is the first crossover product by Nestlé.

Furthermore, Nestlé also worked with AMap, a map service mobile application acquired by Alibaba in 2014, for an online campaign to target its potential customers for capsule coffee. “The idea was to find out those map users whose destinations are often cafes or coffee shops and push adverts about capsule coffee or machines from Nestlé to them,” introduced Tu. “The integration of online and offline marketing brings together both potential and target audiences for Nestlé. Tmall is more than a ‘supermarket-like’ platform online to sell products. We want to contribute to educating consumers about coffee and related knowledge together with the whole industry together, from one end to the other.” It turned out to be a successful campaign with a higher conversion rate compared to the online campaign during the same period of time.

In logistics and delivery, the in-depth collaboration with Cainiao, a delivery and logistics company owned by Alibaba, has enabled Nestlé to greatly enhance its inventory turnover, for example, improved by 40% during the 2019 Double 11 Shopping Festival compared to a year earlier. “Once the inventory turnover speeds up, which brings down the whole operation costs quickly,” Tu concluded.

In December 19 and 26, Tmall held two full-day workshops in Baoshan, Yunnan Province to teach locals how to sell their coffee and products online. The offline training covered not only online operation but also packaging and design. “We hope this will help them raise the awareness of brands, say, Yunnan Coffee,” he shared. “Young entrepreneurs there should bear in mind how to market a product as well as get a sense of where the future is heading.”

In the next three years, Tmall’s goal is to foster 1,000 local coffee entrepreneurs in Yunnan.