Argos plots 'store of the future' as pressure from Amazon grows

Argos: we believe there's a better way to shop online by CHI & Partners
Argos: we believe there's a better way to shop online by CHI & Partners

Argos plans to devise a "digital retail store of the future" concept, as it seeks to ward off increasing pressure from Amazon.

The Home Retail Group-owned brand is set to hire a design agency to help it identify points of difference for its stores, as web giant Amazon spreads its distribution to the physical world by partnering with The Co-operative for collection lockers.

Argos posted a healthy like-for-like sales increase of 5.2% in the eight weeks to 2 March on the back of its popular click-and-collect offer.

The retailer claims internet-related sales now account for 43% of its sales, up from 40% a year ago, while mobile commerce sales grew 117% year on year.

However, Argos is keen to create a strong retail store offering in the face of aggressive expansion by Amazon, with one source saying there is a "crazy amount of pressure" on Argos to "get this right".

Argos' retail estate remains the backbone of its business, but it is reducing this estate and has shrunk its portfolio by 11 stores to a total of 737 for the year ending 2 March, as it seeks to adapt to the changing retail environment.

The retailer is already in the process of giving its stores a digital makeover by kitting out stores with web browsers and introducing Wi-Fi to allow customers to use mobile devices in-store.

It is also rolling out a fast-track collection service for goods purchased online or via mobile devices.

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