Argos’ decision to roll-out its home shopping service nationwide signals a trend towards home delivery services by retailers. It follows a successful year-long trial by Argos in 55 stores in the North West of England.
Marks & Spencer also extended its home shopping range this week with the launch of its biggest ever catalogue, while Sainsbury’s announced plans to model its home shopping service on a US model, serving the M25 region only.
Argos’ move is one of several new initiatives by the leading catalogue shopping retailer to create a contemporary image for itself.
Interbrand Newell and Sorrell was appointed to reposition the company by “refreshing” its logo, refurbishing stores and producing two catalogues, as well as the roll-out of Argos Direct. An interactive TV shopping service is due to launch in November.
Argos Direct enables customers to browse the catalogue in their own time and in their own home, before arranging delivery to the location of their choice.
Argos marketing controller Tony Harper says: “Argos Direct is going to be a very important channel for us. During the trial, half of business was existing customers using the new service and half was new customers.”
He also believes social change has led to a change in retail purchasing. “We are seeing a lot of changes in society, with a higher proportion of women working and more pressure on people’s time. Customers are now presented with an expanding range of choices for shopping,” says Harper.
“We expect home shopping to have a growing participation in our service, but it’s quite hard to predict where the equilibrium will settle down.”
The first ever M&S combined womenswear and home catalogue, called Direct, has been designed in-house. It is being trialed in 20 stores nationwide and will be mailed to selected M&S Chargecard customers. The expansion is part of a strategy to provide new service initiatives, including the recently introduced trial of Internet selling.
The 300-page publication is the retailer’s largest ever catalogue and enables customers to order by phone, fax or post. Deliveries will be made within 48 hours of receipt of order and goods can be delivered anywhere in the UK.
M&S Direct executive of creative and publications Paul Tuttle says home shopping is “critical to the future of M&S”. He cites balance as a vital ingredient for design in the sector. “It is about message versus density and ensuring that the constraints of page size do not limit the overall look and visual space.”
Sainsbury Orderline was introduced in March 1998, following two years of a trial programme called Order & Collect. The home delivery service enabled customers to place orders by phone, fax or Internet and have it delivered for a charge of £5.
But the supermarket chain has now opted to remodel the service on the US system of a picking centre. The company will open its own centre in February, providing a full range of products and serving everyone within the M25. Customers can order by phone, fax, or from an IBM-developed website.
“We trialed in 27 stores nationwide, hitting four million households between September 1998 and June 1999. The result was that a store-based operation for home shopping doesn’t work,” says a Sainsbury’s spokesman.
But the service still requires shoppers to go into supermarkets occasionally as no catalogue is being produced. “Our research found that having a catalogue is very restrictive for people, so customers will develop their own personal catalogues,” he adds.
Having trialed a home shopping service via phone, fax and Internet for over two years, Tesco is now operating its system purely via the Internet. The website has been designed jointly by Tesco, Designercity and Unipower.
The UK’s leading supermarket trialed Tesco Direct from September 1996 to April 1999 in 12 stores throughout the South East.
A Tesco spokesman says: “We now operate in 22 stores in the South East and will add another five stores each week from September until February 2000, reaching over 100 stores in total. As our knowledge and confidence of the system increases, we’ll expand outside the South East.”
Instead of a central call centre, the service operates through individual local stores. “There was not incredible demand for phone and fax orders, so we are majoring on the most popular service – the Internet. Customers input their postcode to check whether they are in the five to seven mile radius of the store,” he adds.
Designercity managing director Jeremy Knepner says the “key component” of the Tesco website must be the shopping aspect.
“There are so many different aspects and facets of the business that the website must support them all, including in-store offers, brands and financial reports. But over the coming months we will put the focus on pure shopping, because Tesco is essentially a major retailer,” explains Knepner.
“Two or three years ago the site was more information based, but Tesco customers expect innovation from the company and there are some very exciting projects in the pipeline,” he adds.
INS creative group head Simon Wright says Argos will benefit from having its delivery vans on the street. “We’ve produced vans that say Argos in a clear, cheerful way. The Argos Direct ones had a more heroic treatment, with added prominence to the word direct,” he says.
“In the future, home shopping will become a very normal thing for all of us.”