Online-to-offline: Nearly $12 trillion in offline economic activity is likely impacted by the internet.
Google is the company in the strongest position to capitalize on the massive online-to-offline (O2O) economy. I discussed Google’s dominant position linking the digital and physical worlds, Google My Business’ evolution and the future of local search as a more distributed phenomenon in my SMX Next keynote last week.
Nearly every ‘enterprise’ is a local business. The term “local business” is often misunderstood and typically conjures up images of mom and pop stores and very small businesses. But any business that transacts offline or sells products and services in a physical place is effectively a local business. The logos below are just as much local businesses as are small merchants. That’s because the majority of their transactions happen in the physical world (COVID-19 is changing that but more in a minute).
National and global brands that are ‘local businesses’
Online-influence offline spending. Most marketers have heard a statement that goes something like this: “roughly 80% of U.S. disposable income is spent within 10 to 20 miles of home.” It turns out this is common sense but not grounded in any single dataset or study. One could do an in-depth analysis of U.S. consumer spending data and you’d probably get to the same conclusion. But it’s largely apocryphal.
However in 2017, Access Development conducted a survey that found, “more than 90% of consumers make most of their purchases within 15 minutes of home or work.” This includes things like fuel, groceries, food, personal care, home and garden, entertainment and retail shopping.
The COVID lockdowns have forced more of those purchases online and e-commerce has grown by triple digits in many categories. E-commerce spending in the U.S. in 2019 was about $600 billion. But the amount of consumer spending influenced or affected in some way by the internet is roughly 20 times larger than that........MUCH MORE
