Argos is to confront the trend of showrooming head on in a vote of confidence in the continued appeal of its retail proposition.
The multichannel retailer, which has embarked on a programme to reinvent itself as a “digital retail leader”, will introduce Wi-Fi in its 700 stores later this year enabling shoppers to browse the internet on smartphones and tablets in store.
Retailers have become concerned by showrooming – when customers browse products in-store then seek out the cheapest product deal online – but Terry Duddy, chief executive of Argos parent Home Retail, was undaunted.
Speaking as Argos unveiled its first annual like-for-like sales rise in five years, he said that showrooming is now a fact of retail life.
“We’re cool with that,” said Duddy. “There’s going to have to be improved transparency [across retail]. What’s the point of stopping them when they can look before they come into a store? Customers are taking control of technology.”
He maintained that Argos’s business model would remain relevant to shoppers because of the multichannel options available, such as in-store ordering for home delivery and Check & Reserve, and stores will continue to play a central role, enabling Argos to offer a wide local choice and immediacy.
Almost 90% of Argos’ sales involve a store, and 30% of sales by value are made in cash. Later this year Argos will pilot a handful of “stores of the future” that feature a number of innovations.
Multichannel sales rose to £2bn at Argos last year, representing 51% of the total. Internet orders, including Check & Reserve, increased by 10% to 42% of the total.
Argos managing director John Walden, who unveiled his strategy for the retailer last autumn, said: “We are building the foundations this year, preparing for more significant growth in the future. We are better positioned than virtually anybody we can think of to win in a digital future.”
Part of the strategy includes strengthening Argos’ private-label offer – it last week hired former Nokia executive Joanne Savage to the new role of head of own-brand – which will also help counter showrooming. “A good own-brand is a reason for people to come back to you,” Duddy said.
Argos already sells 35 exclusive own-brands ranges, such as Alba in electricals, Chad Valley in toys and Habitat in home.
Duddy said that he expects trading conditions in the new financial year to be similar to the one just gone as spending is affected by inflationary pressure and low consumer confidence.
“It’s more of the same,” he said. “Disposable income is lower than it was two years ago.”