Bestore: Supporting Omni-Channel Digital Marketing

With Business Mid-Platform

Case

Author: Jiye Mao & Siqi Wu

Online Pub Date: January 04, 2021 | Original Pub. Date: 2020
Subject: Electronic Marketing, Marketing Information Systems, E-Commerce
Level: | Type: Direct case | Length: 7936
Copyright: © 2020 Renmin Business School. All rights reserved.
Organization: Bestore | Organization size: Large
Region: Eastern Asia | State:
Industry: Manufacture of food products
Originally Published in:
Mao, J. , & Wu, S. ( 2020). Bestore: supporting omni-channel digital marketing with business mid-platform.
Beijing, China: Renmin University Business School
Publisher: Renmin University
DOI: https://dx.doi.org/10.4135/9781529768589 | Online ISBN: 9781529768589
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© 2020 Renmin Business School. All rights reserved.

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https://dx.doi.org/10.4135/9781529768589

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Abstract
As a leader in the high-end snack industry, Bestore has attached importance to the construction
of IT infrastructure like ERP since its establishment. However, in the wave of e-commerce, these
“chimney”-style information systems cannot meet the requirements of the “new retail” model,
which is characterized by multiple channels and scenarios online and offline and thus urgently
need digital transformation. This case describes the reasons why Bestore should establish a
digital middle platform, the process of implementing a middle platform, and the characteristics
and commercial values of a middle platform in enabling the business department. A highly
automatic digital marketing system is established to cover all channels and scenarios. This case
can help students understand a digital middle platform, the key points in its implementation,
and how it helps enterprises cope with an unexpected external environment and drives the
digitization of enterprises in the new era to promote their growth. This case can also inspire the
digital transformation of other traditional enterprises.

Case
At 9 am on February 24, 2020, on the website of Shanghai Stock Exchange, the first-ever live-stream “cloud
listing” ceremony (virtually on the cloud) in history started. Bestore, headquartered in Wuhan, China, became
the first Hubei-based enterprise listed amid the COVID-19 pandemic. The company’s founder and board
chairman, Yang, together with all his employees, was overjoyed to see this success, which was not only the
result of Bestore’s long-term effort but also a reflection of the initial achievements of the company’s digital
transformation. The launch of its business mid-platform months earlier showed its significance. Bestore,
located at the epic center of this pandemic, was severely impacted as all brick-and-mortar stores were closed.
However, the company was not plunged into a plight; on the contrary, it witnessed a sales increase and its
revenue for the first quarter of 2020 rose by 4.16%, with the proportion of its online sales exceeding 50%.
Digital technologies helped deliver its snacks to numerous households by alternative channels.

Looking back on the IT adoption and digitalization of the company, Yang felt a lot. Bestore started with
traditional retailing but also featured informational and Internet technologies. Owing to the support of higher
management, including Yang, Bestore has been largely engaged in IT adoption and digitalization since its
founding. In recent years, it spent a lot in building its business mid-platform to break the bottleneck of its
existing information systems and achieved omniscene marketing driven by data for Bestore.

The Fast-Growing Bestore

After graduating with a fine arts major from Hubei University of Technology in 1997, Yang was recruited into
Kelon and was promoted to team leader due to his outstanding performance a few months later. He became
experienced in marketing after long-term work in marketing and sales, and in 2002, he was appointed the
general manager of the Kelon Guangxi (Province) Sales Division. However, Yang had been longing for his
own business: “Think about what I will be like in five years? I may get promoted and have salary raises, but
I would rather embrace the excitement of having my own business.” To get prepared for his own business,
he spent nearly a year visiting more than 100 enterprises and traversed numerous streets around Wuhan,
and he compiled three editions of business plans. Finally, he found his opportunity—consumers in need of
snacks of higher quality—and it seemed to be a good choice to produce specialty snack foods and establish
a retail chain brand. Thus, after careful planning, Yang borrowed several hundred thousand Yuan to start his
business.

On August 28, 2006, Yang and his three co-founders prepared more than 60 kinds of snacks and set up the
first Bestore shop opposite to Wuhan Plaza, thus entering the snacks industry, a market of nearly three trillion
Yuan. They chose “Bestore” from over 300 candidate names, meaning “for the best quality, to be the store
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for everyone.” Yang believed “serving local consumers with global snacks is something that can turn a small
business into a large enterprise.”

Since that, Yang has been making efforts in the snacks industry and attaching a high priority to product
quality. He made it his mission to “provide high-quality foods and move the world with great tastes,” coming
down to the golden marketing standard saying “consumer experience is everything about marketing,” thus
propelling the “small business” to achieve nearly ten billion Yuan in sales annually. Over the last 13 years,
Bestore has been working hard in Central China and having influence around the nation. Over 2,300 Bestore
shops opened in 98 cities of 15 provinces in Central, East, South, Northwest, and Southwest China. Today,
Bestore has become an industry leader owning over 1,500 SKUs, which cover 12 categories including fruits,
nuts, meat, and seafood (see Exhibit 1), and having more than 80 million registered members. With reliable
quality and fine taste, it stole the heart of Chinese gourmands. Since 2015, its compound growth rate has
topped 30%, leading the snacks industry with its nationwide sales and making “a leading brand in the snacks
industry.”

“Two-Pillar Development” in the E-commerce Age

Embracing the vision of “making a food community and consumption venue trusted by consumers,” Bestore
pays special attention to building offline stores since its foundation, so that it expanded fast in its deep-
reaching areas, gradually forming terminals around neighborhoods to reach consumers. Before 2010, the
development of its shops was mainly around essential matters such as customer shopping experience and
decorations.

However, with the rise of e-commerce, Bestore found that consumers’ buying habits had greatly changed.
Buying could not be achieved by offline shopping only any longer, and interaction and experiencing became
the new requirements of consumers. Thus, Yang realized that they could no longer count on brick-and-mortar
shops only but should set up a new “two-pillar development” pattern by introducing an online operation.
“Since the buying habit of consumers has changed, we, as the enterprise, must change, too.” Bestore co-
founder and president Yang Yinfen was quite specialized in snacks, especially their marketing and supply-
chain system, and he was keen on new technologies and product research. He also believed the e-commerce
to Bestore was as important as its foundation: “our first-time start-up was to establish Bestore, and the second
time is to adopt e-commerce.”

Therefore, Bestore set up its e-business subsidiary in 2012, then launched its business on e-commerce
platforms like Tmall, JD.com, and yhd.com. Later, the company conducted internal restructuring to set up its
e-commerce logistics department in 2013 and place SKUs exclusive to e-commerce channels, thus starting
to explore the new model that integrates brick-and-mortar stores with online channels. In 2017, for better
interactivity and experience for consumers, Bestore promoted its flagship online stores—the theme store and
the Bestore Center, to attract high-net-worth individuals. These smart shops for online and offline businesses
desire to seamlessly link up consumers’ demand and supplies by online and offline channels by relying on
the interconnection of data. The improving Bestore gradually integrated its shops, e-commerce, third-party
platforms, mobile app, and social media business channels, thus seizing a market share that is increasing
year by year. In 2017, the company was listed among the Top 500 of China’s service industry. By late 2019,
Bestore’s revenue from online channels had exceeded 40% of the total revenue.

IT Support and the Bottleneck

Fast Growth of IT-Supported Business

Bestore has always attached high importance to IT adoption. Luo Yiqun, the e-commerce technology director,
who was in charge of the architectural design of its omnichannel business system, the operation and
maintenance of the system, and team building, believed that “Bestore is no longer a traditional enterprise. We
can easily see its Internet-based nature. It can fairly be claimed that Bestore spends half of its years since
foundation in digitalization.”
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During its early stage of offline retailing oriented to regional markets, Bestore adopted financial systems
among others. After its e-business was launched in 2013, the company expedited its information systems
development. However, due to the lack of experience, the information systems development at that time
just targeted surface symptoms, which can hardly support any business. Starting from 2014, the company’s
management decided to revamp its information systems in a comprehensive way.

In 2015, Bestore decided to adopt one of the two mainstream enterprise resource planning (ERP) systems.
The company had a net profit of less than 300 million Yuan but chose to invest 160 million, seeing
modules like material management, financial control, customer relation management, transaction processing,
warehouse management, and human resources being launched online one by one. Besides, the company
increased investment in completing its information systems pattern, developing systems for order processing,
storage management, and merchandise management, thus achieving digitalization of day-to-day businesses.
Bestore also launched 38 subsystems (see Exhibit 2) as to the requirements in purchase, logistics
management, marketing management, order management, and settlement management, starting to handle
its ponderous businesses by IT and intelligence. At this stage, multifunctional peripheral system clusters and
the solid backstage ERP supported the rapid development of its businesses.

Bottleneck of IT in the New Business Model

However, with businesses expanding and sales channels increasing, the existing IT systems could no longer
meet the requirements of diversified consumers and digitalized marketing. Problems began to emerge. How
to interconnect merchandises, capitals, consumers, and supply chains of different channels? How to raise
the efficiency of cross-department synergy and management? And how to enhance the company’s overall
marketing capacity by means of IT adoption? Vice President Mo Jun, who was in charge of digitalization
transformation in the areas of marketing, sales, merchandise, human resources, and organization, clearly
sensed that “consumers have changed; they have become very individualized and diverse. We must rely on
data for precision marketing and rapid marketing, and we must conduct marketing based on big data, but the
existing backstage ERP cannot support these business requirements.”

As for member management, Bestore planned to set up an omnichannel membership system to integrate the
membership operation, members’ consumption points, and properties (prepaid cards) of online channels and
offline shops, but the customer relationship management (CRM) module of the existing ERP began to show
defects. The tens of millions of members registered via Tmall alone produced terabyte-level data, and if all
of them are stored in the CRM, the system can hardly stand it. Besides, it was highly difficult to converge
data from different channels since these data would not blend into the systems of third-party channels such
as Tmall. That was why Bestore membership data was fragmented coming from more than 30 channels,
involving more than 80 million members. This made it impossible for consumers to integrate their consumption
points, coupons, and other privileges and benefits from different platforms, thus lowering the satisfaction and
experience of consumers and hindering the collection and utilization of omnichannel membership data. The
most significant difficulty at this stage was “having consumers” but “having no way to understand and manage
them.”

Luo Yiqun regretted this a lot. “We have so many members, but they are in fact not our members, because
they will become valueless data if we do not use them. We face a great deal of pressure in marketing to
members, because omnichannel retailing means there are both online and offline interactions. There will be
high concurrency and big-data volume, which the existing ERP systems in some scenarios cannot handle.
Besides, we need to cross several systems to ensure precision marketing. There is no natural interlinking.
The existing systems feature different architectures and their data tend to be dispersed; there is no unified
concept. For instance, orders must be used for different channels, but data were transmitted separately,
so that the data were usually repeated and chaotic, hard to respond to. There were also problems in data
synchronization. Existing systems did not share such a model, so there were big problems in challenges in
the accurate storage of data and timely response to them.”

At that time, Bestore could rely only on manual data connections for marketing. It not only took a long
period and a high cost, but also hardly met the many requirements for retail formats. Thus it was unable to

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achieve the expected business. In addition to a large amount of work, the system collapsed repeatedly. During
the shopping spree festival, a single promotion campaign could cause more than one million concurrent
transactions in a short period of time, and the centralized “trunk” architecture of the ERP system cannot take
on the large volume of concurrence, so that the marketing requirements like instant buying cannot be met,
thus hindering businesses. IT engineers would always complain “the old systems respond so slowly that it
is too hard for us to make trial and error, not to mention modifying systems and achieving fast innovation of
systems.” Personalized marketing activities, in such a case, would be even harder.

As for offline shop management, Mo Jun hoped that they would not just “enhance performance” but also
“explore data and empower marketing.” By investing time, human resources, and technologies in building
offline shops, they could fully exert the role of shops in having consumers’ requirements met in a timely
way in the age of digitalization by penetrating into the neighborhood and supplementing online channels.
She stressed that “customers of shops offline take up 20% of our total customers but contribute 60% of our
sales, so we will naturally spend more time on them.” Besides, shops offline could serve the establishment
of high-end brand approaches. Therefore, a smart system that can link up consumers, goods, and markets
to explore consumers’ consumption and help Bestore identify consumers and raise performance becomes a
hard requirement.

Mo Jun emphasized, “We have two beliefs. One is to find target customers for our products. That is to say,
when I have products, I will think about to whom I should recommend. The other is to find goods for our
customers. That is to say, when I have a customer in the store, who has a lot of needs, I should think about
what products and services to offer him.” Bestore found it difficult to continue operation with the current
system. The supplier of the ERP system provided a solution, which was not only complicated, difficult, and
costly, but also unable to support complicated business processes and strategic planning by customization.
What was even more unbearable was the offer of the system; the annual license fee for an account of a single
store was as high as 30,000 US dollars. If the system was launched in all the 2,300-odd shops of Bestore,
that would mean a cost of over 70 million dollars every year. Thus, the choice of the system for single-store
management was infeasible.

As for marketing management, the legacy marketing system was not automatic, innovative, or agile; it was of
low capacity and its development was time-consuming and difficult, making digital marketing hard for Bestore.
Luo realized that “Bestore has a sales volume of nearly 10 billion every year, but after getting listed, it will
have to leap toward 20 billion or 30 billion. For such a leap, our system should not maintain its current
state, or there will be major troubles; there will be an embarrassment if the system becomes unworkable. For
instance, during a promotion, if the marketing system broke down and the payment could not be collected
after orders were placed, or the money paid was not of the right amount, all these will have a direct effect on
the enterprise’s production.”

After repeated internal discussion, Bestore finally found out that the root of all problems was the foundation
of the system. Luo pointed out, “The existing architecture was like building stand-alone single-story houses.
When we need one then we build one, having separate utilities equipped for each house. Thus, our system
will only become more and more bloated with high repetition. However, what Bestore wants to build now is
a high-rise building, and we cannot provide utilities for each room on each floor separately.” The problem
with the architecture was a high priority, so the “big mid-platform and small front-end system” architecture of
Alibaba began to draw their attention.

Luo and colleagues thought of this carefully. “In fact, we hesitated a lot before choosing the mid-platform,
including whether we should take on the project. Surely, we considered based on our backgrounds. We
started to sort out ideas in August of 2018 for project planning of the mid-platform. We had to decide whether
to take on the project from the internal perspective. After discussions with the boss, we finally fixed on it.” After
internal argumentation, the management keenly sensed the value of the mid-platform and wished to launch it
quickly to win competitive advantages as an early user.

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Implementing the Mid-platform

Faced with new technical solutions and architectures, Bestore sought external cooperation to develop the
business mid-platform and finally settled on Alibaba’s ecological partner Yunxi to adopt the implementation
model of “collaborative creation and onsite development with the vendor.” On April 1, 2019, the Yunxi team
was officially stationed in the company, and the whole project was implemented by the professional team,
led by dual-project managers respectively from Yunxi and Bestore. Such highly synergic development was
seldom seen before.

Leaders of the two parties attached high importance to the development of systems, and they would think
of solutions to problems when they arose, like adding staffs when they became insufficient. Luo approved
the cooperation model between the two parties: “First, it is about the coordination of staff. The CRM
implementation of traditional ERP was basically having another company lead our staff, then we have our
staff follow their project plan. However, this project involved a lot of efforts from both sides. We made the mid-
platform project our strategic project, so our IT and business departments paid special attention to it, making
it our top priority. Second, the input of human power from Yunxi was relatively high. We would send one more
product manager if we found one was not enough. And for those matters that could not be settled by staffs on
the site, the R&D manager would soon be sent to solve the problem.”

Requirements analysis and specification were the major tasks at the preliminary stage of the project
implementation. The “new retail” industry developed quickly, giving rise to diversified business models and
marketing methods. If solely relying on the current products from suppliers, it would be hard to catch up with
the development of the times or meet business requirements. Thus, the requirements analysis team made an
all-around survey as to the difficulties and business flows of Bestore.

Unlike the model of being pulled by businesses of the client in a traditional requirements analysis, Yunxi had
two methods for the job. First, it was product-based. Yunxi conducted a requirements analysis based on its
mid-platform products, relying on its i-marketing to identify various business scenarios and cooperate with the
business and IT departments of Bestore to have them raise requirements, thus making a model by matching
and rearranging the reusable micro-functions in i-marketing. The requirement map drawn on the basis of an
overview blocked off many minor details that needed to be settled only at the stage of development, and
hit the point for the mid-platform development of Bestore, thus avoiding unnecessary requirements for the
mid-platform development. Such a new method helped Bestore switch to a clearer, more concise, and more
efficient flow to realize its current business functions.

Keeping an eye on businesses was also a key task. By having interviews with key business personnel of
Bestore, the project team analyzed the way of data intercommunication in the current system, collected
documents of marketing activity of the past, and observed the business flow, so as to build a new business
flow for the new mid-platform system on the basis of actual business tasks. The team identified requirements
one by one and then put them together to create a complete new business flow based on requirements.

During the requirements analysis stage lasting two months, the project team kept improving the requirements
of the new business mid-platform by relying on products and requirements analysis, thus making the mid-
platform architecture map for Bestore (see Exhibit 3), laying a solid foundation for the system development of
the next stage.

At this stage of development, the project team rearranged the logic, module, and function of products, making
the long business flow, which Bestore now has or may have in the future, reduced into very small service
units, then dividing several subject domains and recombining the domains for several business centers.
According to the degree of clustering of offline shops, the responsibility of the center, the granularity of the
center, and whether independent operation can be achieved, the technical micro-service and business micro-
service were planned. When business personnel of Bestore needed to build up a complete business flow or
achieve future innovation and change, they could use the developed micro-service interface and link up a
full business flow like building blocks. The business mid-platform also provided a lot of configurable functions
to support flexible and rapid extension of business functions. Also, the extensibility embedded in the system
allowed flexible extension of new functions without altering the existing codes.
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The system was developed by using the model of a phased development and launch. According to the
priority sequence, the system was launched in three stages (see Exhibit 4). Such a model would ensure rapid
development and facilitate the collection of feedback after each launch at different stages, thus helping with
iterative optimization.

Luo remarked, “We did not expect the effort required for the in-project implementation would be so large, and
the implementation is not only based on our current difficulties, but also includes future business planning.
Since a new set of system has been on, I certainly hope that the new system will meet my requirements
for future planning, so some requirements have been extended. That is why we changed the scope of
requirements several times.”

Such a model of a phased launch advanced the development in an orderly way, and it avoided the potential
problem of impracticality found in the earlier interviews for requirements through continuing iterations. Details
of new requirements were figured out, and problems beyond expectation were caught.

After completion of the system development, the implementation team instantly conducted UAT, or a user
acceptance test, engaging key users. A user group leader, technologies group leader, and architecture group
leader were selected based on different businesses, and key users of departments like the Store Business
Department were invited to the test, so that tests could fairly tell whether the system would meet the actual
requirements of different business units. After training, business manager Fu Xuan realized that “UAT requires
personnel from business departments to cooperate in the test and provide business flow test cases to
guarantee the accuracy of the system’s functions. Besides, UAT should also be done to the peripheral system,
so as to ensure complete business verification by setting the UAT supporting system.”

Switching Over to the Business Mid-platform

The business mid-platform was divided at three levels: the technology, the business, and the test. The
switch-over at the technology level requires the determination of the technical solution of data transfer and
the systems for interfacing and corresponding interfaces. The switch-over at the business level is mainly
targeted at business personnel, who should be trained so that they can skillfully use new systems to carry out
new businesses including digital marketing. Lastly, after the switch-over there should be tests to ensure the
success of the system switch-over.

The scope of the switch-over mainly involved replacing the CRM system of the existing ERP and integrating
and launching all kinds of peripheral systems to form a new business mid-platform system. The project team
made a detailed design of the switch-over, having a specific schedule and arranging the jobs of each staffers
in the project; there were plans for each step, who would do what, and what technical details to pay attention
to, as precise as what to do every half an hour, because the time available was quite limited.

There were mainly two challenges for the system switch-over. First was the large data size. Past business
activities accumulated a large amount of membership data and business data. Such massive data caused
difficulty for the transfer, so that project manager He Huixia of the E-commerce Department felt great
pressure: “As for the data size, there are more than three Ts of data solely in the CRM of ERP, and there are
26 sheets and 1.2 billion items of data in the target tank for transfer. That is a very large volume. And the
data of turnover change in recent years must be transferred in the system. Besides, about the database itself,
zones were set in the past. Could the networks having different strategies in different machine rooms settle
everything in a night will be a big problem.”

Second, data sources were different and belonged to different systems, and some data were not held by
Bestore itself but required negotiation with the supplier. Luo realized that “the system of Bestore was relatively
complicated, from which it could be seen that our mid-platform not only replaced the existing CRM but got
connected with the peripheral system somehow. Not only interface calling is complicated; there can also be
bottlenecks in communication, thus posing potential risks.”

There were headaches for He Huixia: “We actually have two membership systems. One is the old

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membership mid-platform we created by ourselves, which only functions at the service level and does not
assume the core membership business, so the transactions of coupons and credits were all stored in the
CRM of ERP. However, our membership assets were scattered in the two systems, so it was quite difficult to
transfer these data. All these are major risk points. Data transfer, membership interconnection, switch-over of
privileges and benefits, and business switch-over on our mid-platform: considering all the four matters, it is in
fact quite challenging to finish them overnight.”

On the night of September 2, 2019, Bestore Tower was brightly lit. According to the original plan, the new
business mid-platform would soon be launched. To achieve a seamless switch-over, the new system must be
launched at one time. He Huixia announced her goal: “We have only one night, because during the launch,
membership assets and our orders cannot be acquired or used and all transactions must be halted. We did
not want to hinder businesses the next day, so we had to reserve one night for the launch, about 11 pm to 7
am the next day. The switch must be completed before our business started the next day.” All members in the
team nearly stayed up all night, but they still found it impossible to do it in one night, because data transfer
involved a large amount of work, which was very complicated. Different peripheral systems, calls, directors,
businesses, and interfaces were all to be considered.

The project team immediately held a meeting. In order to ensure a smooth transition for businesses the next
day, the team decided to adopt a new switch-over strategy. On the night of September 2, data previously
stored in CRM should be transferred; to guarantee the effectiveness of the jobs done that night, data collected
before September 2 should be transferred to the production environment of the new mid-platform, then
increases every day after that would be recorded and integrated into the new environment; other data would
be still in other systems (old and peripheral systems). The project team re-planned the process of the system
switch-over, dividing follow-up conversion into two steps, so that each switch-over could be completed with
quality and quantity guaranteed. The first step was to replace the CRM functions on the night of September
9, and the second step was to integrate the membership data on Tmall into the tank of 80 million members
on the night of September 19.

He Huixia led the business testing team to “test all steps one by one, including all the core functions, so that
the businesses conducted the next day would be smooth for consumers, who would not sense any change in
the membership system.” After testing, the new system was finally established, and the business mid-platform
was launched with success.

Business Mid-platform Empowering Omnichannel Digital Marketing

Three Areas Empowerment

The newly launched business mid-platform features a new type of enterprise-oriented Internet architecture,
having obvious advantages over the existing system architecture and promising to facilitate the businesses
of Bestore (see Exhibit 5). The new architecture would link up omnichannel membership data; be able to
accumulate membership assets in the enterprise and from peripheral channels, thus enhancing the ability
of membership operation and marketing; and also support omnichannel, high-volume, and high-concurrency
marketing scenes. Besides, interfaces reserved laid a foundation for acquiring data from third-party platforms,
so as to rapidly respond to market changes and cooperate with different parties to support their businesses.
The new system has achieved marvelously since its launch, and He was quite satisfied with the performance
of the new system: “It assumed more than 170 million interface calls since its launch, and calls every day in
the last two weeks amounted to 60 million, having an average response time 16 times of the existing systems.
Its steady operation would strongly support the high-concurrency promotions to take place.”

The new architecture was fit for building a closed-loop, agile, and all-around marketing system, realizing the
sharing of data and services, supporting millisecond response and empowering marketing, so as to achieve
full-range linking from the flow entrance (including cross-industry cooperation, cooperation for the third-party
platform, and self-owned channel contact). After the linking, a system for credits from membership operation,
privileges and benefits, and services was set up for full life-cycle management of clients. The system
supported a sustainable management strategy centered at consumers and tried to build up an omnichannel
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and omniscene marketing service ecosphere that is oriented to exploring and creating clients’ values, so
as to maximize such values. Interconnection with stores and third-party platforms was fulfilled to achieve
sustainable operation of consumers, thus realizing the full-range digitalization of consumer operations,
enhancing the efficiency of consumer operations, and forming a closed loop of businesses to facilitate them.

The new architecture supported the overall upgrade of Bestore in both the quality and quantity of businesses
(see Exhibit 6) and improved key indicators like consumer stickiness, purchase value per transaction,
consumption frequency, and customer loyalty. A complete membership management function served as the
foundation, and the omnichannel digital marketing was the fundamental solution; both of them made up the
core function of the business mid-platform.

Empowering membership management. The business mid-platform achieved member management by the
interconnections in membership, orders, privileges and benefits, and coupons, so that all-around collection
of members’ information, all-around recording of orders and purchases, interconnection of privileges and
benefits, unification of coupon issuance, and all-around acquisition could be realized.

The membership interconnection managed to collect membership data from various channels in the
ecosphere in a unified way. So far, membership information from the channels of shops offline, e-commerce
platforms, the app, social media businesses, and take-out services has been interconnected. Then with
the interface of the DMP, or the data management platform, omnichannel data at the 10 million level,
including members’ information, orders, merchandises, and interactive data in key business fields that
involve membership, cards, coupons, and credits, would be collected into local membership pools. After
that, membership data would be processed by an intelligent algorithm to give rise to OneID as the sole
identification mark of consumers. Finally, members’ information would be sorted out to identify and integrate
repeated membership from different channels, so as to eliminate the noises of repeated data and complete
kinds of consumers’ data. So far membership interconnection has covered more than 90% of members online
and offline.

Other tasks of member management could be launched based on the membership interconnection having
unified members’ information. Order interconnection could integrate the data of orders taking place from
purchases in different channels by one consumer, so that the order database will be formed to facilitate the
generation of consumers’ profile and demand forecast.

Privileges and benefits interconnection was also based on uniformed member management. Different levels
of the member promotion system were put down based on the purchasing power, sales value per transaction,
and preferences according to the membership data collected. Such a subdivision of over 80 million members
would help differentiate one group from the other. Such a hierarchical classification would ensure members at
different levels different types of privileges and benefits, thus boosting their consumption.

Cards and coupons interconnection is a marketing management system based on the privileges and benefits
of members. All the credits earned by members and their purchases in all channels and all times would be
stored by the cards and coupons interconnection. Unified management would be applied to the privileges
and benefits (mainly in the form of cards and coupons) earned by members from different channels, so
that consumers would freely use them by whatever channel. Such a function of unified cards and coupons
management would keep track of the coupons taken by consumers in whatever channel and at whatever
time, so that the issuance of cards and coupons would be based on different channels after analysis.

The four kinds of interconnection linked up membership data (see Exhibit 7) so that Bestore could not
only have a complete profile of its consumers but also build up a complete members management system,
accumulating a large amount of consumer data from several dimensions and perspectives. These data
could also be rearranged and marked through technologies like machine learning and data analysis, so
that preparations could be made for precision marketing management at the next stage. The business mid-
platform also enabled Bestore to cooperate with external channels like Alibaba to include external data into
its membership data information system, thus having universal data to fully explore potential clients.

Empowering marketing activity management. After the launch of the efficient marketing activity business

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mid-platform, omniscene and omnichannel marketing became smoother. Marketing activities could reach
channels previously unavailable and create an omniscene marketing model and could provide support for
highly efficient marketing management. The marketing model of the business mid-platform formed a closed
loop, featuring diversity, accuracy, automation, efficiency, omnichannel, and omniscenarios. What consumers
pay attention to are not only the merchandise purchased, but also the experience of shopping. This requires
business model innovation that covers pre-sale publicity, in-sale experiencing, and after-sale services.
Therefore, it is necessary to build up an efficient, personalized, and agile digital marketing management
system for different business channels in order to enable a better shopping experience of consumers.

The business mid-platform solved the problems in the previous process of marketing, including long
preparation time, low efficiency, difficulty in attracting customers, and no closed loop formed. Therefore,
after the new system interconnected the data from different modules, the agility and response of marketing
activities were largely improved. Huang Cheng, manager of the Business Department, felt a lot about this:
“More than one million orders were placed during the Singles’ Day Shopping Spree in 2019, which the
traditional ERP could not possibly handle. Different businesses, without such an architecture with branches
and such operational process, could hardly have such a volume of interaction settled if following the previous
scheme of information interaction by the trunk.”

With the business mid-platform, the organization of marketing activities became more convenient. Huang felt
his job became much easier: “The mid-platform in fact provided us with services. After modules were set in
it, we could timely mobilize them based on a current incident and build them up to organize activities. For
instance, fundamental functions like the issuance and verification of gift cards could be combined at different
centers, so that the business of the gift card could be rounded out.”

Empowering innovation of marketing model. In addition to supporting the abovementioned marketing

activities, the business mid-platform also supported diverse marketing models, mainly including initiative
marketing and event marketing (see Exhibit 8).

For initiative marketing, Bestore holds the initiative, including issuing notices, getting coupons actively and
passively, and H5 (social media–WeChat) marketing activities. The highly automatic marketing system
relied on the holiday data stored, members’ personal information, and data of consumption habits to reach
consumers, thus generating and implementing marketing activities and launching iterations, so as to reach
target consumers with customization and enhance the efficiency of marketing activities.

Event marketing includes eight events for daily operation, namely, basic event, graded event, event of
privileges and benefits, card event, credit event, coupon event, event of notice, and event of tag. For instance,
in a graded event, the system would support multitag combinations for automatic reach and monitoring data
in real time. As soon as consumers reach the threshold for a membership upgrade, they would see their
privileges and benefits enhanced, so that the maintenance cost would be largely reduced.

With the support of the mid-platform system, Bestore could launch more than 100 marketing events
simultaneously, which not only enriched the formats of marketing activities, but also boosted the capacity of
holding several marketing activities simultaneously. Such a large-scale activity would be unthinkable in the
past. Huang Cheng felt that their efficiency had been promoted greatly: “The jobs on which we used to spend
two days could be settled in about two minutes now. We can settle event marketing easily, including basic
events and events at different grades. For instance, a customer’s birthday or our anniversary celebration. And
the tag event will remind us of events; if it is triggered, it means the customer is about to forget us. We will give
some initiative reminding, which is also the event marketing. As for initiative marketing, it actually means we
would have some marketing strategies based on our operational activities. We apply the mid-platform system
for a nearly omniscene coverage, through all possible channels, because interconnection has been realized
among them.”

Two months after the launch of the system, 97 initiative marketing activities were launched, reaching more
than 14.8 million customers and issuing over 4.04 million coupons. Six among the eight marketing events
were implemented, reaching both WeChat channels 1.71 million times and nearly 70,000 via texting. During
the shopping campaigns between October 20 and November 7, the mini app and stores offline had 520,000

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items of prepayment, amounting to over 105 million Yuan.

The Empowered Digital Marketing

As for the precision marketing reach, a stepped-reach model was adopted for interaction with members to
enhance the timeliness of marketing. The consumers covered included new customers, potential customers,
and old customers, so as to fulfill full customer life-cycle management including transfer, loyalty management,
and awakening of lost customers. As for the acquisition of new customers and potential customers, the new
system had an all-around monitoring of the sources of customers and reserved data interfaces in different
channels, thus making data exchange through an API and seeking customers by advertising in the form of
the DSP, or demand side platform. After the advertising was launched, analysis would be made to the data
returned by third-party platforms to evaluate the result of customer acquisitions and direct follow-up decisions
in this respect. As for the outreach to existing customers, the highly automatic marketing system would rely
on the channels, tags, and model data in the membership center to acquire member management data to
interconnect the channels like WeChat, Weibo, texting, and TikTok, leading to consumers, then select the
ways to reach (including but not limited to phone numbers, texting for promotion, WeChat pushes, and in-app
pushes). By operating an automatic marketing system, precision marketing to reach existing customers will
be realized.

The convenient tag-based selection. In digital marketing, applying a tag and selection require high system
agility. In the new retail era, the information and requirements of consumers are changing, needing an
agile and flexible system for rapid updates and precise identification. Vice President Mo Jun, in charge
of digitalization, stressed, “In the new retail era, multilevel, multibehavior and multitag consumer data are
becoming more and more important for retailers today. However, with the accumulation of data, it is urgent to
interconnect data from different sources and create multiple consumer scenes for consumption. With such a
tool, we would be able to achieve precision reach to customers, thus reducing costs of advertising. We used
to have some waste in advertising cost because our target was not clear or precise.”

In the business mid-platform system, the smart tag platform established a consumer tag system, generated
consumers’ profiles, and supported refined operation of consumers. The tag platform not only tackled the
inflexibility and difficulty of maintenance found in handwritten scripts, but proved to be able to rapidly update
tags in a timely way based on consumers’ behaviors and also complete the profile of behaviors during
consumption. Besides, a custom tag was also possible in addition to the tags generated via algorithm. Sales
personnel could observe consumers and tag them, which was an effective supplement. With a tag platform,
target consumer groups could be better analyzed to exert the value of data and smartly put down and select
recommended marketing strategies, thus achieving precise reach with both time and labor saved. On the
basis of diversified marketing services, including privileges and benefits and coupons and text reminders,
customer-oriented digital marketing will be fulfilled.

The convenient selection after tag establishment was the key to precise reach. With the business mid-
platform, the customer selection by the technical team of Bestore progressed from being manual to being
automatic, and the time spent in preparing for marketing activities was reduced a lot, and advertising
models could be optimized on and on to enhance the precision of marketing. Huang Cheng remarked, “We
used to spend days in manually importing data from Excel to BI before we made any decision. But now
we can come to the final decision in minutes.” With this system of tagging and selection, customers of
different kinds in marketing activities could be selected with efficiency, and “zombie consumers” could be
revitalized by using the remaining information after integration to analyze preferences and find out retrievable
customers. By finding the points at which the consumers were lost, pertinent solutions were applied and
targeted recommendations were made to call back the selected customers. Also, there can be management
of customer loyalty, for instance, by the RFM (recency, frequency, monetary value) model in the system.
Huang Cheng would find out consumers with similar consumer value and potential value by their recent
consumptions, consumption frequency, and sum of consumption: “for example, we found such a type of
consumer: they showed a consumption frequency higher than ten times the previous year, but in the recent
three or four months, their consumption has been declining. That means we can build up such a model,
trying to find out the consumers lost in recent months based on the features of the consumer, then conduct
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marketing targeted at this kind of consumer.”

With a strategy model, business personnel could evaluate selected consumers of different types and find out
the model with the highest conversion rate for marketing activities.

Smart marketing methods. Highly smart marketing was another feature of the system. The business mid-
platform established a closed-loop marketing process, including marketing cost, target setting, customer
grouping, communication and reach, marketing strategy, implementation monitoring, and analysis and review,
so as to fulfill whole-chain marketing data monitoring. At the stage of customer group selection and consumer
profiling, tag groups would be formed by randomly combining tags, then different tag groups would be
applied in the forms of intersection, union set, and difference set to build up customer group packs for
the demonstration of groups with key tags. Afterward, based on setting about marketing, several marketing
models could be selected, including initiative marketing, event marketing, and promotional rules. The targeted
value could be realized by different marketing models to realize highly personalized marketing plans. After
rules were set, marketing reach would be started automatically to distribute information to consumers by
the unified backstage information reach entrance and unified monitoring of channels. Meanwhile, results of
marketing would be dissected so that key indicators of activities could be monitored at any moment during
activities and timely modifications could be made to raise the efficiency of review and focus on strategy
iteration.

The analysis that used to take three days by manual labor could now be done within one day, and comparison
of data with similar activities could be done to find out opportunities for activities and push iterations to
form a complete closed loop of automatic marketing. Luo Yiqun raised an example: “We gave an activity
for the Mid-Autumn Festival during September, mainly for selling a Mid-Autumn Gift Box. All the tags in the
system were visualized, and the analysis was visualized online; customer selection tools were intelligent. In
fact, selecting 3.5 million consumers could easily be completed in the system, and the whole process from
customer selection to completion would involve a data volume of over ten million.”

Flexible establishment of marketing activities. The new business mid-platform could help realize marketing
ideas quickly, thus ensuring marketing activities high flexibility and efficiency. According to marketing business
formats, the system reserved abundant activity templates to help customers build up activities easily. In the
popular H5 marketing, there are 800 templates of six types provided, namely, consumption points, lottery,
game playing, testing, assistance, and generation. Up to 56 items of information in the four categories of
basic information, interface, marketing, and publicity could be rearranged flexibly. The system could even
be equipped in single shops for marketing activities, so as to reach target consumers by precision means
of reaching. For instance, each of the H5 marketing activities must be subcontracted by other companies
for design and implementation, but now with the mid-platform system, Huang Cheng said he could agilely
develop marketing activities. “In the past, for such activities we would need external cooperation, namely,
advertising companies, for planning. Then development must be made with the mini-app, H5 or games, so
that the cost could amount to around 100,000 Yuan and the time spent could be about one month. In view of
the limited budget, we could afford only a few activities in a year. But now we could do it almost at any time,
solely by relying on the mid-platform. An activity could be prepared and launched within two weeks, which
was impossible before. With clear-cut requirements, resources of the mid-platform and the front end could be
utilized to prepare the activities.” While obviously reducing the cost, the business mid-platform could ensure
more efficient completion of marketing and rapidly put ideas into practice.

Vision of the Future

The business mid-platform supported marketing activities in 29 channels, almost achieving full omnichannel
marketing coverage for Bestore to equip itself with the ability of omnichannel operation. Bestore also gained
the capacity of omniscene marketing; by interconnecting members’ data, marketing activities could almost
cover all types of scenarios of consumption, such as for work, leisure, gift giving, and impulse buys. For
instance, in the lately launched smart shops, sales personnel could make accurate recommendations based
on customers’ consumption information, so as to achieve omniscenario marketing driven by data. During the
pandemic in early 2020, the business mid-platform showed its advantages to tide Bestore over the difficult

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time. However, the business mid-platform was just half of the overall digital mid-platform, so what will be the
next step for the digitalization of Bestore? How will the future system development and implementation imitate
the success of the business mid-platform?

https://dx.doi.org/10.4135/9781529768589

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