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Wednesday, 24 October 2012

Argos' 4 point plan for growth

1. Reposition Argos’ channels for a digital future
Stores to be “focused on product pick-up and customer service for transactions that will increasingly be managed online or through mobile”.
Shops “will include more innovation with web-based browsers, in lieu of catalogues, Wi-Fi which will enable customers to use their smartphones and tablets in stores, and a fast track collection service for goods purchased online or via a mobile device”.
The catalogue “will move from its traditional position as the lead Argos channel into a supporting role”. Circulation will be cut as consumers take up digital channels.
First digital catalogues to be launched before Christmas.

2. Provide more product choice, available to customers faster
Hub and spoke distribution model will make the most of Argos’ store network and infrastructure “to offer market leading immediacy of fulfilment on a wider range of products”.
Trials will begin in January 2013 to test operational aspects and the customer offer.
Argos will “build on capabilities in large item home delivery with express delivery options”.

3. Develop a customer offer that has universal appeal
Argos aims to expand its customer reach with “a more universally appealing offer”.
Product ranges to be extended to appeal to the broader groups by, for instance, inclusion of branded products “where a broad range is necessary to build category authority”.
The retailer aims to double penetration of exclusive brands to represent a third of total sales by the 2018 financial year. Argos’ portfolio of 35 exclusive brands will be rationalised to focus on fewer, more powerful brands with appeal across categories”.

4. Operate a leaner and more flexible cost base
Shift investment towards digital marketing as the digital offer grows.
Close or relocate at least 75 stores as leases expire over the next five years.
By then around 75% of the store estate will be on lease terms of five years or less “which will provide the flexibility to respond to market changes”.

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