Argos opening digital stores inside Sainsbury's supermarkets

Argos has announced a partnership with Sainsbury’s that will see digital stores open inside selected supermarkets.

The 10 digital shops will offer customers 20,000 non-grocery products that can either be bought instantly in store or reserved for collection later that day.

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In addition, shoppers will be able to choose from an extended range of 40,000 products if they opt for home delivery, but this option is already available via the Argos mobile app. The retailer has also confirmed that the partnership will see it take up between 1,000 and 5,000 square feet of retail space in the selected Sainsbury’s stores.

John Walden, chief executive of Argos’ parent company Home Retail Group believes that the partnership allows the firm to broaden its distribution model.

“This strategic capability has opened up options for a variety of new Argos stores and formats, and the possibility that we can now cost-effectively reach more customers and neighbourhoods with an Argos presence,” he said. “I look forward to the results of the 10 store programme with Sainsbury’s and to understanding the full potential of this exciting opportunity.”

While it is clear how Argos will benefit from offering consumers another avenue to purchase its products, what Sainsbury’s gains from the partnership is less obvious. In fact, with the supermarket already offering electronic and homeware goods, Argos’ digital stores could effectively steal some of its sales.

Argos’ willingness to embrace digital technology has seen it emerge relatively unscathed by the growth of online shopping, managing to retain a healthy high-street presence while some of its competitors have been forced into closures by the growth of online rivals like Amazon.

Since becoming chief executive last year, John Walden has implemented a five-year digital restructuring plan that has seen the firm’s laminated catalogues replaced with tablets and the introduction of a click-and collect service.

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Last year, Argos also announced a partnership with auction site eBay allowing consumers to collect items from selected stores.