Argos-eBay click & collect partnership: what the experts say

Argos and eBay announced a new click & collect trial yesterday (24 September) that will let consumers purchase goods at leading e-tailer eBay and pick them up at one of 150 Argos stores around the UK.

Some 50 eBay merchants will be participating in the initial trial, and Argos managing director John Walden believes the arrangement is a good opportunity to build fulfilment relationships with fellow retailers and to generate extra footfall in his company's stores.

Essential Retail caught up with a selection of retail commentators to analyse what the tie-up means for the two businesses and for the wider retail industry.

Matt Piner, retail research director at industry analyst firm Conlumino, said: "I think the partnership is very much a reflection of the move towards multichannel. In the past year we've seen Tesco investing in a marketplace format, Amazon rolling out collection lockers and Sainsbury's introducing click & collect to local stores, encroaching on the traditional strengths of these two retail giants. This move is a reaction to that, making Argos more of a destination and offering eBay more convenient fulfilment, in an attempt to prevent losing customers elsewhere.

"That said, the move appears to favour eBay more than Argos. eBay will continue to retain its pull online because of the price competition it encourages and has now stepped up its multichannel convenience to strike back at Amazon in particular. Argos, which doesn't have a 'marketplace' of its own, doesn't have the same kind of USP and its core offer remains under threat. This move does little to offset the risk that many shoppers will continue to see more value and more attractive ranges elsewhere, and will only use Argos for small impulse purchases."

Huw Thomas, managing director at retail IT solutions provider PMC, said: "For me the Argos-eBay partnership is inspired. If they get the consumer marketing right around this then the timing could be perfect for a big rise in peak transactions. One challenge with online shopping, particularly around Christmas, is home delivery. The facility to order online and go to a local store at your convenience for collection should make a lot of people’s online habits more pervasive.

"It also goes some way to addresses one of my pet hates and misconceptions, that the high street is dead! This for me demonstrates that even the pure play online retailers see the benefit of bricks and mortar stores in enhancing the overall customer experience."

Ray Buckler, project director at consultancy Retail DNA, said: "It looks like this click & collect marriage will certainly help both companies, with each playing to its retail specialist strengths. Argos will be seeing additional footfall in its stores, and chances to have add-on sales taking place, plus a contribution towards its bricks and mortar costs. eBay gets a rapid solution for increasing delivery options for click & collect. This sort of simple strategic business move is also a much better way to get consumer footfall back into the high street. It took the most obvious click & collect destination, the Post Office, until this May to see the light and begin to offer this service! We are becoming a nation of shoppers demanding service from retailers on our terms, and click & collect is just part of answering those demands.

"If the tie-up continues after the six-month trial, it would also make sense for Argos to make far more of its huge inventory available via the existing eBay channel. Plus, as eBay announces a test of a one-hour delivery service in London, I wonder who may be the partner for that as well? Could eBay be on its way to have a high street presence co-branded with Argos?"

Chris Webster, VP, head of retail at global consultancy Capgemini, said: "Our e-Retail Sales Index has shown a very strong correlation between mobile sales (23% of sales), and buy/reserve and collect services (24% of sales). The fact these are rising in parallel shows the tectonic shift to e-retail being time and location specific, whether ordering on a mobile device or being able to collect from a specified location at a time and place of your choosing.

"The eBay and Argos service demonstrates the rise and rise of the Martini era of e-retail – "anytime, anyplace, anywhere". The combination of the large delivery/collection needs of eBay's customers and Argos's 700+ stores, many of which are in prime high street locations, will only accelerate this trend."

Some industry commentators, meanwhile, took to social networks to offer their views on the eBay-Argos deal.

Jonathan DeMello, head of retail consultancy at property group CBRE, said on Twitter: "eBay's tie-up with Argos was inevitable. [It] will be a win win for both and hopefully the first of a few deals with pure-plays Argos will tie-up."

In yesterday's joint company statement announcing the new partnership, president at eBay Marketplaces Devin Wenig remarked: "Traditional retail isn't going away; it is transforming. Smart retailers are innovating, reimagining the store and what it means to shop. We're proud to join Argos on this journey. Their unique store network and operating model is fit for serving customers in a digital future. This exciting pilot takes us one step nearer to our goal of offering customers an inspired and seamless shopping experience."

What do you think? We are keen to hear from the industry about what the Argos-eBay deal means for the wider retail industry. Comment below or contact us on Twitter @EssRetail.