Innovative Retailer – Argos
The Name: Argos
The Place: Oh everywhere. Almost everyone lives within ten miles of an Argos store apparently.
The Story: Innovation, you say. Argos, you say. It can’t be done, you say.
Actually I haven’t… Well, this column is about to prove to you once and for all that a big company with a catalogue the size of an elephant’s foot can move like the wind to surf the digital wave.
Well I don’t think anyone thought… Yes, they didn’t win the Oracle Retail Week HP Multichannel Retailer of the Year 2015 by standing still. No sir.
Can I speak? No time. The customer won’t wait. Argos has to transform itself from a catalogue-led shopping experience to a digital one but first obviously we will need to go to the Underground or shall we start with hub and spoke, or the Sainsbury’s mini outlets.
OK, you are going to need to calm down: Alright then just while I give you the back story. So, if the mighty City of London tells your company that its vast stores are unprofitable and you should start offloading them pronto or your share price will plummet because what people want is digital not traditional, what would you do?
Agree immediately. Some of those bankers look a bit handy: Wuss. Well, Argos looked them in the eye and said: “Hold on. Give us a chance to turn ourselves into a master of modern technology, redesign the shops, introduce new collection concepts and invent a new distribution system.” And the City said: “Okay, but be quick about it, the boys are waiting outside.”
Crikey. Drama: Argos is now halfway through a five-year plan (they just never go out of fashion do they?) and they are proving amazingly quick at trialling and rolling out any number of new concepts which emanate from their 120-plus strong ‘Digital Hub’ teams who seem to have carte blanche in suggesting anything that might make the customer’s life easier. All under the watchful eye of digital supremo Bertrand Bodson.
For example? You won’t be tripping over the usual pallet of a thousand huge catalogues any time soon in one of the 55 new look Digital Stores or trying to find a pen to fill in your little slip – it’s all iPads now innit and shiny counters, and with no more vast print run costs they can introduce many more products and brands to the range (40-plus new high-end ones to boot). But probably even more important than the Apple-style interiors of some of the shops is where the outlets actually are.
Let me guess – the underground: You were listening! 20,000 products available from a unit with a sales area no bigger than your average kitchen.
And where is this revolution taking place? Cannon Street if you please. Offering same-day collection and next-day too. It’s a six-year deal with Transport for London but if it is anywhere near successful expect to see it from Cockfosters to Rayners Lane (Heathrow surely).
It’s a whole new world: It’s a digital-first world my friend. Mobile sales have rocketed to 28% of revenues and online generally represents nearly half and Argos expects it to rise to 75% of total takings by 2018.
What’s the deal with Sainsbury’s? Ah, another trial. Shortly to be decided if it is worth carrying on with or not but basically 10 smaller format digital stores in the supermarkets to join the 20 that already exist in Homebase.
So it’s all about e- and m-commerce: Actually it’s all about speed. In digital stores there is a Fast Track aisle where you will have your longed-for purchase within 60 seconds – employees have to stop what they are doing if an order comes through on that line so the 60-second deadline is met.
That’s ridiculously fast. Is it so you don’t have time to change your mind? So droll. But get this, Argos is also trialling iBeacons.
Not got a good feeling about this. When you are 50 metres away from the store the iBeacon will track you down and trigger the collection process.
For goodness sake, it’s a bit James Bond isn’t it? I only came in for a mop: Soon they will begin developing the technology to subliminally encourage you to order a product that is already lined up for you on the collection point.
Is that a joke? Yes it is.
Well I have a point of order about all this little-ness and quick-ness business Argos stores are historically large because they need to hold vast amounts of stock in the back room so that when someone orders Item Z on page 3,491 that no one has ever bought before, it’s there. And how are you going to deal with that in your kitchen-sized Tube station store? Pah, I give you the hub and spoke delivery system. Formerly in the dark ages of the empire vast warehouses used to restock the big stores every now and again and everything was… so…very… ponderous.
And now? Now one store will be designated the hub and it will deliver a number of times a day to its five closest spoke stores. Meaning that yes, you can walk into the underground, order your kettle in the morning and pick it up on the way home. The hub and spoke is what facilitates all the other changes being made. It’s not what customers see but 20,000 products can be taken to any Argos unit within hours and it makes those companies operating the old way look very, very slooooowww indeed.
You have to be pretty savvy to be an Argos customer these days though, what happens if you are the demographic happier with the pencil and catalogue slip. The digital army – 30,000 Argos store employees – are trained up to help you and if you are a very keen shopper there are even tablet training sessions after stores have closed. Any other silly queries?
Yes, where is the theatre? How are you replacing the retailtainment of sitting in a plastic chair and waiting for your collection point to come up on screen as excitement builds? That was never a thing. You’re just embarrassing yourself now. Run along.
PCMS is a global provider of IT software, specialising in retail services, including point of sale (PoS) software, contact centre and IT support services. It is a pioneer in developing mobile retail solutions, including customer shopping apps and mobile PoS. Its client list includes John Lewis, Marks & Spencer, Waitrose, Whole Foods, as well as Walgreens in the US and fashion brands including Prada and Ferragamo across Europe.