Friday 30 January 2015

Argos-Sainsbury's Digital store test - an opportunity for two-pronged shopping missions?

News of Sainsbury’s addition to its concession portfolio (30 firms including Timpson, Jessops, Virgin Holidays and Thomas Cook) by opening ten pilot digital Argos stores in Sainsbury's that will aim to offer a broad range of general merchandise, in a combination of in-store purchase and click & collect.

The concessions route has to be a no-brainer for Sainsbury’s (or any other over-spaced squeezed middle player) especially as the quality of the partnership can be optimised using the old Kwik Save formula of a basic rent + a percentage of sales…

Whilst this is another way in which Sainsbury’s can optimise the 6% underutilised space in larger stores and add to its general merchandise offering, the real advantage for suppliers has to be the opportunities and scope for joint promotions that link Sainsbury’s and appropriate concessions in a multifaceted shopping mission.

Depending upon the category, promotions that lead on either the concession or Sainsbury’s products have to result in synergies and therefore increase their appeal for both retailers..

Other Sainsbury’s concession partners include Centre for Dentistry, Bupa, Johnsons Dry Cleaners, Explore Learning, Starbucks, RAC, and AA. Details on Sainsbury’s concession deal here

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