Paytm to increase e-commerce customer base through O2O model

As part of its efforts to rope in more customers in its e-commerce business, the Noida-based Paytm is adopting the online-to-offline (O2O) model to increase its user base. It may be recalled that the Chinese e-commerce giant, Alibaba has infused fresh funds at Paytm's e-commerce business recently.The online-to-offline route is for those customers who are not online savvy buyers. Paytm is aiming at getting more offline users to its fold. As part of its strategy to increase its offline business, the firm is aggressively promoting Quick Response codes on its recently opened Paytm Mall, for which, the company is infusing fresh funds. As early as February this year Paytm had announced that it would make Rs.600 crore investment in its QR code program in 2017.New alliancesPaytm has forged alliance with the Korean smartphone manufacturer, Samsung for the purpose of enabling the small stores to sell the latter's products by offering a commission varying from 3-20% based on the price of the gadget. What is more, Paytm is also negotiating with various other smartphone brands to firm up similar tie-ups in various categories including electronics and fashion.

Offline networksAmit Bagaria, Vice President, Paytm Mall, said: "We are aiming at creating an offline network as a platform for brands to reach out to millions of consumers. By accomplishing this, we will be able to optimize the supply chain and marketing expenses on the consumer's behalf. This platform, in turn, will be beneficial for the partner merchants, enabling them to grow their business and earning more revenue. Besides that, the platform will also bring in additional footfall at outlets into the brand distribution network without keeping the inventory."Separation of businessesAs part of its growth strategy, One97 Communications, the parent firm of Paytm had recently separated its payments and commerce businesses. Paytm Mall, which comes under Paytm E-commerce, recently received a funding of $200 million. The Chinese Internet group Alibaba alone has invested $177 million in Paytm E-Commerce.Paytm Mall is based on Alibaba's B2C e-commerce company, Tmall. Bagaria said that almost 99% of all shopping in India happened offline. "Therefore, we strongly believe this model will allow us to drive online traffic from offline retailers. We also expect this to transform traditional businesses", he added.