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Argos online and mobile sales hit nearly half of total revenue

Multi channel investment paying off for what was a catalogue-based retailer

Online and mobile app-based sales at Argos, alongside orders through customers' TVs, have hit nearly half of the company's total revenue, delivering £1.9 billion in the last year.

The news came as Home Retail Group, which includes that retailer as well as Homebase, announced major progress in its multi-channel retail strategy as part of annual results.

The group said it would "continue to develop an integrated shopping experience that encompasses the latest technology" for internet and mobile channels.

Terry Duddy, chief executive at Home Retail Group, said: "Our focus on operational excellence and further investment in our multi-channel leadershiphas delivered a solid performance and enabled us to gain or hold market share in our businesses."

Argos is the second largest internet retailer in the UK (behind Amazon), the company said, with 400 million website visits in the past year. During May 2010 Argos launched its iPhone app, which, to date, has seen more than 1.3m downloads.

Future developments include the introduction of a TV shopping channel on Sky this summer called "Argos TV", and mobile apps for the iPad and the Android mobile operating system in time for Christmas.

The introduction of reserve and collect at Homebase has also helped drive further growth in internet sales. Argos already had an established reserve and collect service. Internet orders represent 36 percent of Argos' total sales, up from 32 percent last year.

A "voice put-away" technology roll-out started in 2010 will be completed in the first half of 2011. This technology automatically guides stockroom assistants to the correct stock location, with the key benefits "being around 10 percent quicker processing and further enhanced stock file accuracy, thereby improving availability".

A trial creating additional choice through "internet only" lines has continued and there will be around 12,500 lines available in the 2011/12 financial year, said the group.

The current focus of the extended internet only ranges remains in areas such as technology, white goods and toys, with new areas such as health & beauty and children's books "also working well over the xmas period".

Overall sales of the additional internet-only lines grew by approximately 50 percent compared with last year.

Argos is also trialling a new route to extend ranges, which is being provided by third parties but embedded within the Argos web shopping platform. This allows Argos to sell third party products on its website and earn a commission on the sale. The first trial is in the books category, where Argos is building an offering of around 5,000 titles. This trial will be extended to other categories during the 2011/12 financial year.

On the financial front, sales in the year to 26 February 2011 declined by 3.5% in total. And benchmark operating profit slumped to £219 million, a £47.2 million or 18 percent decline on the previous year's £266.2 million.


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