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Business

Chinese appliance makers, retailers mounting online offensive

SHANGHAI -- Chinese appliance manufacturers and retailers are aggressively working to boost online sales as more consumers use the Internet for shopping.

     Retail giant Suning Commerce Group saw its online sales surge 69.2% on the year in the January-September period of 2013, to 16.1 billion yuan ($2.67 billion). The figure far surpassed the 10.7% growth in overall sales, and the share of total sales exceeded 20%. "Many customers visit stores to check products first-hand and make purchases online," says a staffer.

Visitors to Suning stores can make online purchases after seeing products first-hand.

     The firm has set up "online shopping stations" inside physical stores in a bid to entice visitors into making impulse purchases. Chairman Zhang Jindong has expressed his confidence in increasing both online and offline sales. Since June of last year, the firm matched in-store prices to those found online.

     Gome Electrical Appliances, the country's second-largest appliance retailer, is also beefing up efforts to increase online sales. And Jiangsu Five Star Appliance, under U.S. firm Best Buy, set up an online sales site in December.

     With more than 300 million online shoppers in China, the market for Internet shopping reached 1.85 trillion yuan in 2013. And the share of online sales in total retail sales expanded to 7.8%, helped by the spread of online payment systems. "Both retailers and manufacturers cannot ignore Internet (sales) any more," says an industry observer.

     Leading appliance maker Haier formed a strategic partnership with e-commerce giant Alibaba.com. Haier, which operates more than 33,000 outlets nationwide, will use its brick-and-mortar stores as venues where customers can check merchandise for themselves as well as delivery and installation centers, says Chief Executive Officer Zhang Ruimin.

     In China, more and more companies are adopting this type of business model that integrates online and physical-store operations. This approach is dubbed "O2O", short for "online-to-offline."

     Television and mobile phone maker TCL plans to step up its O2O business, by strengthening partnerships with Internet and software companies, Chairman Li Dongsheng said in an interview with local media.

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