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Present status of China’s O2O market and the implication

Author Goo, Jinkyung Date 2017.01.16 Issue No 3
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China’s O2O (Online to Offline) market has dramatically grown due to the rapid expansion of mobile equipment market and the government’s willingness to foster the mobile industry.

 

China’s O2O market has been developed mainly focusing on lifestyle services including food delivery, vehicle-sharing, and journeys.
● The existing offline companies introduced O2O services to enhance customer service quality and operation efficiency
● China’s O2O market, entering a mature stage, is being reorganized, mainly focusing on large IT businesses including Baidu, Alibaba, and Tencent.

 

The Chinese government announced various policies upbringing the O2O industries.
● As policies of <Internet Plus>, The Chinese government announced: Opinions on commerce and distribution innovation development of online and offline connectivity and on the promotion of industrial development (in September 2016), and Opinions on Internet and distribution Action Plan (in April 2016).
● Key factors to China’s O2O market success are low entry barriers to the O2O services industry and various upbringing policies by the government.

 

It is necessary for rapidly growing Korean O2O market to promote autonomy, in order to brace for a market mature stage.
● Currently, Korean businesses have unstable profit structures, and they are highly dependent on government fund for investment, and lack of autonomy.

 

In order to promote Korean domestic O2O market, it is necessary to expand market flexibility via regulation improvement, raise start-up businesses, support technology innovation, and produce professionals.?