As the boundary between ecommerce sites and physical stores has blurred, OMO has become an indispensable strategy for businesses. Combining the convenience of online retail with the uniqueness of in-store browsing, customers are able to enjoy a more comfortable shopping experience, while businesses can improve both their lifetime value (LTV) and brand loyalty.

This article explains what OMO is, how it differs from related marketing strategies, its advantages and disadvantages, and some examples of Japanese companies that have achieved success with it.

What’s in this article?

• What is OMO?
  
• Why OMO is attracting attention
  
• Advantages of OMO
  
• Disadvantages of OMO
  
• The key to making OMO successful
  
• Examples of OMO initiatives
  
• Examples of success with OMO
  
• How Stripe Terminal can help
  

What is OMO?

OMO is an acronym that stands for online-merge-offline. It’s pronounced letter by letter: "oh em oh.” It is a marketing strategy that aims to design and deliver a unified customer experience, rather than treating ecommerce sites and physical stores as separate entities.

If a company properly implements this approach, it is able to offer customers the following shopping journey:

• Confirming inventory on your smartphone before heading to the store
  
• Checking reviews for items that caught your eye in-store, as well as recommended products
  
• Information about goods purchased in-store is automatically reflected in the app, enabling recommendations for future orders and issuing coupons to encourage spending
  

In practice, OMO aims to break down barriers between online and offline, ultimately providing shoppers a better overall experience.

Differences from O2O

OMO is often confused with O2O (online-to-offline), but there is a clear difference between the two.

O2O seeks to attract buyers on the web and encourage them to visit brick-and-mortar locations. Specific examples include allowing online coupons to be used in-store and promoting shop information on social media to encourage in-store visits.

Differences from omnichannel

OMO is often compared to omnichannel. Omnichannel is an approach that connects multiple sales channels—such as ecommerce sites, physical stores, apps, and social media—to offer customers a consistent shopping journey. They could seem similar since each connects various touchpoints, yet omnichannel sometimes lacks full system integration. That gap increases the risk of inconsistent experiences across channels.

Differences from unified commerce

Unified commerce is a very similar concept to OMO. Both approaches ultimately aim to provide shoppers personalized service; the way each one achieves this differs.

OMO prioritizes enhancing convenience by efficiently linking online and offline journeys, regardless of whether backend platforms are fully integrated.

On the other hand, unified commerce brings together and centrally manages numerous backend systems—including stock, orders, customer information, and payments—to create a uniform experience across all purchasing channels.

OMO can deliver a sophisticated and simple customer experience once unified commerce has established a strong foundation of integrated data and systems. In other words, we can consider the two as closely linked, complementing each other’s differences.

Why OMO is attracting attention

The use of internet shopping has surged dramatically since the COVID-19 pandemic, and buying goods on the web has become commonplace. At the same time, the improved capabilities and performance of smartphones have made it incredibly straightforward to search for products and shop on the go, while the availability of various cashless checkout options has further boosted the use of ecommerce.

On the other hand, people still want to see and touch products in person at stores. OMO is gaining attention as an approach that combines the convenience of online with the experiential value of offline.

Advantages of OMO

Let’s look at the advantages of OMO from a company’s perspective:

Acquisition of customer data

Digital and in-person behavior are consolidated under a single ID, enabling a deeper understanding of a customer’s purchase history and interests. This allows a company to leverage this information to improve LTV and increase repeat buyers.

OMO marketing

By enabling the use of temporary data through proprietary apps and membership platforms, advertising costs can be reduced, therefore improving return on investment (ROI).

Brand experience

By providing a uniform brand experience across online and physical stores, brands enhance customer trust and satisfaction.

Disadvantages of OMO

Although this approach offers many benefits, it’s also important to understand its drawbacks:

Cost of system integration

OMO initiatives require extensive integration, which inevitably incurs costs. Connecting point-of-sale (POS) systems, ecommerce, inventory management, payment processing, and loyalty platforms is required, necessitating a significant initial investment and operational reforms.

More complex privacy compliance

Given that OMO integrates online and offline data, personal information protection is significant, and this requires the utmost care. If a mistake is made regarding privacy, the likelihood of violating the rules greatly increases.

The key to making OMO successful

OMO won’t succeed by merely connecting technology. Here, we outline the key points to keep in mind to make it a success for your business:

Real-time inventory management and payment processing

Live inventory management and payment processing are notable to OMO. For instance, suppose the app accurately reflects stock by location and allows customers to reserve items on the spot. In that case, they won’t have to endure the negative outcome of visiting a store only to find that it’s unavailable.

By instantly syncing in-store orders to a shopper’s web history and reward points, retailers gain valuable data that supports personalized recommendations and future coupons.

Real-time inventory visibility and immediate payment processing enable a unified shopping experience wherever people choose to buy.

Store staff training

Beyond platforms, the customer service provided by store staff is major to OMO success. Creating and implementing a setup that allows associates to instantly see what products shoppers are interested in and what purchases they’ve made in the past, brick-and-mortars are then able to achieve the following:

• When a customer presents a membership card as they enter a store, staff can use a tablet to view the items they recently looked at online, as well as past orders
  
• Based on that information, associates can suggest products tailored to the customer’s preferences by asking questions such as "How about this item?”
  

OMO directly impacts company systems and frontline services alike, making on-site training important.

Protecting privacy and ensuring customer trust

Companies need to clearly explain how information is handled, secure consent, and deliver an environment where convenience confidently outweighs any concerns.

Examples of OMO initiatives

To effectively implement this type of marketing, it’s imperative to go beyond simply connecting web sales and offline operations by translating the setup into concrete programs that customers find both practical and comfortable. Let’s take a look at some representative use cases of OMO initiatives:

Using apps

An app is indispensable for OMO. Functions including checking in at shops using a membership card or QR code, awarding points for visits, and distributing store-exclusive coupons not only enhance the in-store experience but help retain shoppers within your ecosystem, preventing switching to competitors. In addition, by leveraging the app to track customers’ purchase history and interests, you can continuously provide personalized recommendations tailored to each person.

Simple payment processing and loyalty integration

A core factor in favor of OMO is its simple, diverse payment processing. Customers complete checkout smoothly with the same payment method, whether in-store or online, and the experience improves further when points and coupons are applied automatically.

As cashless checkout spreads, it is important to offer a wide range of checkout options tailored to shopper needs, including credit cards, QR code payments, electronic money, and buy now, pay later (BNPL). Since it’s difficult to handle everything in-house, using a payment processing company that enables multiple transaction types simultaneously is also a practical approach. Doing so allows customers to buy securely using their preferred method, and businesses deliver a uniform journey while reducing the hassle of system integration and management.

In-store returns for online purchases

Allowing shoppers to return items bought on an ecommerce site at a physical store is one of the major OMO programs. For the customer, this eliminates the hassle of packaging and shipping, while for the business, it creates opportunities to resell returned goods and generate additional orders. The ease of returning items is effective for boosting buying motivation as well.

Examples of success with OMO

Here are a couple of success stories of Japanese companies that have put OMO initiatives into practice:

Adastria

Adastria operates OMO shops including "Dot-ST” and "and ST,” offering customers a shopping experience that integrates both online and offline. They have introduced measures to enhance convenience, such as allowing people to try products bookmarked in the app or the web at stores, and offering Quick Pick for next-day pickup of online purchases. Adastria is driving these efforts by enhancing the customer journey through outfit suggestions displayed on digital signage and connected to their STAFF BOARD, where store teams can post content themselves.

PARCO CUBE

PARCO CUBE in Shibuya uses digital signage and app integration, serving as a place that demonstrates an OMO business model combining order and store visit data. When a shopper scans the QR code displayed on the digital signage with their smartphone, the selected product information is transferred to their device. After making a selection, the customer can then complete the purchase on their phone.

How Stripe Terminal can help

Stripe Terminal allows businesses to grow revenue with unified payments across in-person and online channels. It supports new ways to pay, simple hardware logistics, global coverage, and hundreds of POS and commerce integrations to design your ideal payments stack.

Stripe powers unified commerce for brands such as Hertz, URBN, Lands’ End, Shopify, Lightspeed, and Mindbody.

Stripe Terminal can help you:

• Unify commerce: Manage online and in-person payments on a global platform with unified payments data.
  
• Expand globally: Scale to 24 countries with a single set of integrations and popular payment methods.
  
• Integrate your way: Develop your own custom POS app or connect with your existing tech stack using third-party POS and commerce integrations.
  
• Simplify hardware logistics: Easily order, manage, and monitor Stripe-supported readers, wherever they are.
  

Learn more about Stripe Terminal, or get started today.