Retail Technology Driving Change: Q&A with Sainsbury’s-Argos

M&A is a massive part of today’s retail landscape; and in the UK this hasn’t got much bigger than Sainsbury’s 2016 takeover of Argos’ parent company Home Retail Group. RetailTechNews caught up with George Goley, CTO, Sainsbury’s-Argos recently at FUTR2020, to discuss how Argos is embracing retail technology, as well as some of the biggest trends in the space.

RetailTechNews: How has retail technology helped Argos develop into a tech-driven company?

George Goley: In 2012, Argos was a catalogue-based retailer with single-digit digital engagement from customers. The future was clearly online, but with more than 90% of sales coming from traditional catalogue and walk-in business, it was clear that a decision to move online would require courage and a major commitment to technology to survive.

The Argos leadership team launched a digital transformation strategy that gave customers a new way to experience Argos online and especially on mobile phones and tablets. We began creating not just our tech that we have presently, but our capability to create the tech our customers want in the future. And not just customer-facing tech, but also the store-colleague-facing tech, our data analytics capabilities, and our distribution systems technologies.

Thanks to our ongoing digital transformation, around 60% of sales at Argos now start and/or finish online, and more than 80% of those transactions occur on mobile phones and tablets. In 2017, we were named Retail Week’s Tech Retailer of the Year. And with the acquisition of Argos by Sainsbury’s in 2016 came a renewed commitment to serving customers whenever and wherever they want across the entire Sainsbury’s group.

With technology pivotal to helping retailers increase sales, how can these businesses ensure they are tech-driven, without isolating the customer? How is Argos managing this?

The way Argos, and the best tech-driven companies, make sure that tech deepens customer relationships, instead of straining those critical relationships, is twofold.

First, we use customer feedback, both explicit and observed, as a primary source of new ideas for tech drivers. For those ideas that start from the current or expected customer experience, the goal of improving life for customers is embedded from the beginning.

Second, when the primary source of the idea is not a direct response to a customer need, we make sure that the first question we answer is: how does this benefit the customer? Moreover, we keep asking and exploring that question the entire time we design, build, deliver, and evolve the solution.

Amazon has mastered using tech to offer speed and convenience to their customers. How can retailers seek to keep their customer base loyal in the midst of this?

Amazon does a nice job of offering speed and convenience to customers. But Argos does an even better job of offering speed and convenience to our customers with same-day Fast Track delivery to 95% of homes in the UK and with same-day collection at more than 800 Argos stores, more than 200 of which are conveniently located in Sainsbury’s stores.

Argos has advantages that are hard for our competitors to match, including generations of loyalty built by great experiences, a fantastic distribution network, and industry-leading digital experiences, but we know that’s not enough. We need to use our tech and our amazing distribution and store colleagues to deliver what customers want whenever, wherever, and however they want it.

For Argos, and most tech-driven retailers and consumer-facing businesses, earning customer loyalty requires commitment to know our customers better than anyone and then to building the experiences we know our customers will value.

Possessing a single customer view has never been more important for retailers, given the number of platforms consumers interact with. How are retailers doing when it comes to obtaining this level of understanding?

The challenges in getting a single customer view are many, especially for retailers with extensive legacy systems across multiple businesses, but the best efforts recognise that value can be produced for customers long before the company can claim to have a 'single' customer view of an individual across all systems and interactions.

As an industry, we are making real progress in not only understanding our customers, but in applying that understanding in ways that delight customers. Still, there is a long way to go in this space and that represents a major opportunity for retailers.

How will voice search change retailers’ relationships with their customers?

That will be up to each retailer to determine and it depends what opportunity they see in voice. Voice-invested retailers will find ways to create voice interactions that proudly portray their brand’s values, adapt to the customer, and seamlessly interface with other digital and colleague interactions.This content was originally published in RetailTechNews.