Despite the growing popularity of online shopping, last-mile issues remain a challenge for e-tailers.
One-year-old FingerShopping has found a cost-effective solution that could be a model for the industry.
Last-mile issues are difficulties e-commerce and logistics companies face when delivering goods to their customers.
These challenges could be anything from traffic jams to parking problems and consignees not being around to receive the goods.
That’s why industry players have been exploring the online-to-offline (O2O) model.
Online shopping platform FingerShopping leverages the extensive physical network of sister company Circle K, a convenience store operator, to provide one-stop e-commerce services.
Circle K and FingerShopping are subsidiaries of Convenience Retail Asia Ltd. (CRA, 00831.HK), a listed unit of Fung Group (formerly Li & Fung Group).
Christine Chan, senior e-business manager of FingerShopping, told EJ Insight that the most important feature of the strategy is that customers can pick up the goods in a Circle K outlet or have them delivered to their designated address.
Quite surprisingly, most FingerShopping customers prefer the former.
Instead of having the products brought to their doorstep, more than 90 percent choose to collect them at Circle K.
For FingerShopping, combining its online service with Circle K’s physical store network is a smart move.
Circle K has more than 320 outlets in Hong Kong. Those in MTR stations are the easiest to find.
By making use of the MTR transit network, logistics costs could be kept down.
In addition, customers are finding self-pickups at MTR stations handy while reducing the risk of unsuccessful deliveries.
At the moment, FingerShopping mainly targets female customers, focusing on goods such as healthcare and beauty products, small home appliances, groceries and other minor items.
The product range could expand anytime soon as more companies see the benefits of FingerShopping’s O2O approach.
Chan said the group has been fielding inquiries from merchants about selling their products through its platform.
FingerShopping, which started in 2013, had HK$8 million (US$1.03 million) in revenue last year, CRA said in its 2014 annual report.
The company plans to increase its profile by ramping up brand-building and promotion.
Chan said logistics and marketing are the largest expenditure for the company.
Recently, it took part in an e-shopping campaign organized by advertising firm JCDecaux.
In one of the promotions, commuters received discounts on certain skin care and personal care products by using their mobile devices to scan wall-mounted QR codes at MTR stations.
Chan said the event was a success, judging by an increase in the company’s membership base.
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