Omnichannel integration strategy based on BOPS

Abstract

Technological innovation and the upgrading of consumer preferences have greatly accelerated the rapid development of the "new retail" omnichannel model. Meeting the personalized and seamless interactive experience expected by consumers requires integrating the advantages of both offline and online channels and expanding the integrated and intelligent omnichannel layout. This has emerged as a complex problem that the industry urgently needs to address. In order to tackle this issue, we conducted a study on a Buy-Online-and-Pick-up-in-Store (BOPS) pricing game between offline stores and e-commerce departments, considering factors such as match probability and network cost of return. Furthermore, we proposed the Buy-Online-and-Pick-up-in-Store-and-Return-Online (BORO) strategy and conducted an analysis on the variation in market share and revenue levels for both offline stores and e-commerce departments under this strategy. The results demonstrate that: (i) the omnichannel strategy of BOPS can increase the revenues of both offline stores and e-commerce departments only when the distance costs are moderate; (ii) the BORO strategy provides greater benefits to offline stores compared to e-commerce departments; and (iii) the effectiveness of the BORO strategy is influenced by factors such as match probability, distance cost, and product return. This research not only provides a theoretical foundation but also practical insights for the strategic channel management of omnichannel brand merchants.