Gome plans 100,000 ‘micro stores’

Chinese electrical retailing giant Gome plans to open 100,000 ‘micro stores’ in 2015 in a move it says will help it build a retail community of more than 100 million customers.

The bold vision is part of a new strategic multi channel plan Gome is embarking on this year to bridge the gap between online and offline sales and embrace fast growing channels like mobile shopping.

“With the onset of the mobile Internet era, the development of consumer behavior is trending towards a focus on the individual, with fragmented consumption time, diversified shopping setting, and less distinction between channels,” the company said in an explanation of its strategy.

“With the change in consumption behavior and demand, Gome is destined to upgrade the “omni-channel experience” in both online and offline to “total retail experience” emerging from the integrated online and offline channels, allowing consumers to move freely between online, offline, mobile terminals and joint- operating channels. The group will focus on the development of Mobile Micro Shops on the front-end interface platform, connecting online and offline. Meanwhile, the group will enhance the value of the supply chain with a focus on the back-end big data infrastructure to build a total retail community with more than 100 million customers.”

By having so many effective points of sale spread across China, all linked online and all supported by a boosted supply chain system to ensure rapid supply of goods, Gome believes it can increase its share of the appliance and electronics market and engage with more customers.

“Through Gome’s total retail shopping process, consumers from different entrances will enjoy more product choices than ever, diversified services including shopping assistance, queries, payment, installation, after-sales, reviews and feedback, etc. Meanwhile, the group will also conduct targeted marketing and promote repeat purchases by transferring real-time customer behavior data to the front-end in a timely manner using the big data terminal.”

Gome says loyal fans of the brand are the consumers with the most potential. The company will leverage social media like WeChat and Weibo, to “share products, achieving cross-category, cross-brand and round-the-clock sales,” creating what it promises will be “a superb consumer experience” tailored to each individual.

Along with the 100,000 mobile micro shops, Gome plans to double its social media ‘fan base’ by 2017.

In-store, the changes are just as dramatic. Gome says by expediting the digitisation of its physical stores; increasing product variety, introducing a sophisticated product experience and new technology, the group will allow consumers to make purchases while shopping “and playing”.

The company will also expand its physical store network into second tier markets, targeting 100 new cities over the next three years with full size stores as well as its micro store network, and it will boost the resources of its eCommerce portal Gome Online to boost reach and sales.

By collecting data from all transactions and analysing it in the clouds, the company expects to be able to conduct increasingly targeted marketing.

“Furthermore, the group will leverage the data to boost collaboration between value platforms including procurement, logistics, after-sales, financial services and information.”

All this will be backed up by a sophisticated logistics network.

“Gome is committed to building China’s biggest socialised logistics network platform for home appliances. With its strong infrastructure and supporting resources and 1688 chain stores nationwide (including the stores under the non-listed Gome group), Gome will continue to establish the highest service standard of “three deliveries/day, precise delivery, installation on delivery”.”

After-sales service will also receive a boost: Gome is already China’s largest air-conditioner and television installation service provider. By offering the whole after-sales service process within the product validity period including installation, extended warranty, maintenance and home appliances recycling, and the promise of “Deal with the problem within 24-hours”, Gome aims to become China’s largest platform for home appliances after-sales services by 2017.

Gome CEO Wang Junzhou said In 2015 the company will strive to build a “Gome ecosystem” covering consumer groups of all ages, channels and markets.

“This will support the group build China’s best total retail platform and achieve the target of “building another Gome” by 2017, thus creating greater value for shareholders, suppliers and consumers.”

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