Argos: 'We want to be a digital retail leader'

Mark Steel, digital operations director at Argos, spoke to Marketing at the Bazaarvoice Summit, about the step-change in its comms strategy, the business' transformation plan, targeting higher demographic customers and why it's opening concessions in Sainsbury's stores and Tube stations.

Argos: digital operations director Mark Steel says the brand is trying to broaden appeal
Argos: digital operations director Mark Steel says the brand is trying to broaden appeal

What are your main areas of focus?

From a digital perspective we’re focusing on innovation and we recently opened a digital hub in Victoria, which is ideally placed for us to partner with different start-ups.

It’s a small team focused on trying to think about things that the main business wouldn’t. By protecting that resource and investing in a dedicated innovation team we’re able to take advantage of opportunities, new initiatives and think about new ways we can create value for our customers.

What innovation have you developed through the hub?

One of the things we developed through that team is our kids’ wish list app, which is aimed at 5-7 year olds and launched before Christmas.

The idea behind it was to recreate some of the experience that children loved about Argos historically. For example, [children enjoy] circling the Christmas catalogue to let mum and dad know what presents they want for Christmas.

Check and reserve is something we pioneered in the UK and we continue to try and develop our offer because standing still is not an option.

The app was one of the ideas that came out of our 2014 hackathon and we’ve had some great engagement metrics through that. The average dwell time was 13 minutes.

It's interesting that you've recently started trialling small format stores in Sainsbury's. What are you aiming to achieve?

Check and reserve is something we pioneered in the UK and we continue to try and develop our offer because standing still is not an option.

We’ve agreed to trial in 10 locations with Sainsbury’s and we’ve got two that are open right now. It’s very early days - it literally opened last week but we have been running concessions in Homebase stores for some time now, which we are running in parallel.

Homebase is part of Home Retail Group with Argos and we have 40-50 concessions now operating on a very similar model, and so far they’ve proved very successful. They are a really important part of our plan moving forward and we’ll look to do more of those.

Cannon Street tube station also has a small format Argos in the station. So far we’ve had a great response and we’ll continue to trial new formats like that over the next couple of years.

Stores are a really important part of our multichannel offer. Customers really value having that physical touch point. Some customers still prefer to come in and pick something up. 

In October you rolled out your biggest marketing campaign with a real step-change in tone. What was the strategy behind that?

One of the pillars of our five year transformation plan (launched in 2012) is something that we call 'universal customer appeal'.  

Over the last couple of years we’ve seen the rate of growth in mobile increase. It’s a really big part of our business now; it’s grown incredibly successfully for Argos

We know we have a high level of penetration of all different types of customer group across the UK but we have a slight skew towards a less affluent demographic group, so universal customer appeal is about trying to make our brand even more appealing to different customer groups. 

Our rebranded, re-launched marketing campaign that came out the back end of 2014 was about doing that, about reaching out to customers across all different groups and spectrums across society and talking about some of the things customers might not know about Argos, like our check and reserve service.

The difference between what we do and our competitors is the immediacy. We have a view of stock on a real time basis. We used that advertising campaign to reinvigorate the brand, appeal to an even broader audience and to share some of those propositions.

Last Christmas your sales via mobile increased 28%. Do you expect mobile sales to grow further?

It’s really difficult to predict what’s going to happen. Over the last couple of years we’ve seen the rate of growth in mobile increase. It’s a really big part of our business now; it’s grown incredibly successfully for Argos as it has for the retail market overall so I would expect it to continue.

We currently have around 45% of our sales come through digital channels. We’re definitively seen that number grow significantly over the past four/five years. Digital is the key part of our strategy – we want to be a digital retail leader. 


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