Caixin Explains: How WeChat Handles O2O Commerce

(Beijing) — O2O, or online-to-offline commerce, has become a buzzword in e-commerce. Companies like Tencent Holdings and Alibaba Group are racing to roll out apps that can link the Internet to traditional businesses and to partner with physical stores and service providers.

Tencent is using WeChat, its popular social networking app, to push deep into e-commerce territory dominated by Alibaba. Millions of the app's users have linked bank accounts to its payment function, partly due to a host of promotions. Besides allowing vendors to open storefronts on WeChat, Tencent also says the app can serve as an O2O tool for traditional businesses. Caixin spoke to a few businesses working with WeChat to see how the new commerce model works and what its limitations are.