At an event to unveil its first “digital concept store” on Old Street in London today (26 November), Argos revealed a revamp that puts technology at the front of the shopping experience. The old paper catalogues have been replaced with iPads that allow shoppers to browse and search for information on products, check stock and place an order.
It has also replaced paper posters with LED light boxes and digital screens, enabling the retailer to run campaigns highlighting products and promoting services and offers. John Walden, managing director at Argos, confirmed that Argos is in talks with brands around in-store marketing opportunities, an area he said the retailer has previously failed to take advantage of.
“Outside the full catalogue we haven’t ever really taken advantage of this opportunity because our stores haven’t really been to promote product. Now we have a vehicle to showcase product which opens up for suppliers a whole new opportunity to partner with us. They want retailers that aren’t just online, that can show off their products and promote their brands in stores,” he added.
Walden said Argos is still “figuring out” the media model and talking to brands about how they might want to run campaigns in its new stores. He sees this as a new way for the retailer to generate revenue as the store moves from print to digital, as well as a means to keep the store interesting and fresh and get customers coming back.
“Giving reasons for people to come in because there’s something interesting and new to see is difficult. Now we can change displays every hour, every day, every month,” he said.
Behind the scenes, there are also changes to how Argos fulfils orders as it looks to take advantage of the growing use of click and collect service. Currently, around a third of Argos customers go online to reserve an item before going in store to pick it up.
It is trialling a new ‘hub and spoke’ distribution model in 50 stores where its largest stores will become ‘hubs’, stocking an expanded range of 20,000 products. These will then supply products to the smaller ‘spoke’ stores, which typically stock around 12,000 lines, using its own vans and drivers to deliver goods to local Argos locations.
This means Argos will be able to offer immediate, same day or next day delivery on an expanded range of goods at a greater number of its stores. Anyone that orders online will be able to join a “Fast Track” queue that Argos guarantees will “get customers in and out” within 60 seconds.
“Increasingly, fulfilment is a place where retailers are competing to get products to customers faster and cheaper. We think we’re positioned really well to provide leading fulfilment opportunities to customers by bringing more product into local markets,” said Walden.
The changes are part of Argos’ five-year transformation plan, outlined a year ago, to position the business as a “digital retail leader”. Walden admitted Argos faced a number of challenges from online competitors and investment by traditional retailers in multichannel offerings.
In particular for Argos, Walden said that its catalogue business was no longer appropriate in a digital world, while its customer experience was not as strong as some of its rivals. The firm saw sales drop for five consecutive years, although it returned to growth in the year to 2 March, boosted by investment in IT infrastructure to develop its online, mobile and tablet services.
All these changes are aimed at improving the customer experience for shoppers and making Argos, as Walden puts it, “more universally appealing”. Sales assistants will be taken from behind the tills and collection desks and put on the shop floor with their own tablets to offer help and advice to customers, while Argos is also rolling out Wi-Fi to all its stores
Argos is hoping to open its first digital concept store to customers before Christmas. Walden told Marketing Week that once it is open the retailer plans to promote the new stores to shoppers using local radio and outdoor marketing in locations such as tube stations, as well as geofencing to lure customers in when they are in the area.
Store Look & Feel
- Replacing Argos blue with red.
- “Modern and contemporary” redesign with white brick-effect walls, porcelain floors and energy efficient lighting.
- Paper catalogue replaced by iPads and digital catalogue that offers further product information, stock checking and ordering capabilities.
- Removing collection desks.
- Introducing new till system that acts as stock checker, point-of-sale and collection point.
- Adding ‘Fast Track’ tills so customers that order online can go in store and pick up their goods in 60 seconds.
- Deploying staff to the shop floor with tablets to improve customer interactions.
- Redesigned customer service area.
- Introducing LED light boxes and digital screens to promote products.
- New product displays to show goods on offer.
- More localised and relevant marketing messages, including “Hello Old Street” sign above the door and “Welcome Wall”.
- New ‘hub and spoke’ distribution model.
- Offering same day store pick up on around 20,000 products.