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Argos Group on-line sales reach STG164m
Thursday, May 30 2002
by Andrew McLindon

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The Argos Retail Group has more than doubled its e-commerce sales in the last year to STG164 million as selling over the Internet starts to pay off for some retailers.

According to the results for Argos' parent company, GUS, for the 12 months to 31 March 2002, Argos Retail Group (ARG) increased its sales over the Internet from STG78 million in the previous year to STG164 million.

Apart from the Group as a whole, Argos alone saw three percent of its own STG2.8 billion in sales come via the Internet during the year. Wehkamp, the ARG-owned Dutch retailer, had an even larger portion of sales on-line, at 12 percent.

However, ARG did experience the downside of on-line retailing with its Jungle.com e-commerce site making an undisclosed operating loss in the year despite cuts in personnel, overheads and IT.

Although Argos' on-line retailing results are not spectacular, they do demonstrate that more people are prepared to spend more money in purchasing goods and services via certain Web sites.

According to Daniel O'Boyle Kelly, senior analyst with research firm IDC, Argos' on-line sales should be deemed a success for the company despite only amounting to three percent of total sales. "Its sales over the Internet represent a sizeable amount of business and, just as importantly, show there is a lot of potential to grow those sales even further," commented O'Boyle Kelly.

He told ElectricNews.Net that there was little doubt that e-commerce sales would continue to grow in Europe. "The growth may not have happened as quickly as first expected, but, year after year, Internet usage and commerce continues to climb," he remarked.

This was shown during last Christmas when most European countries saw an increase of more than 40 percent in the number of consumers going on-line. According to research firm Jupiter MMXI, close to 33 million Europeans used the Internet to do their Christmas shopping during December 2001 and spent around EUR2.9 billion over the entire Christmas period.

In Ireland, Jupiter said that Internet users splashed out close to EUR60 million on-line during the whole of 2001, which was double the amount in 2000.

A number of companies are moving to help Irish companies further embrace e-commerce, including the Irish hosting company Digiweb and e-payment solutions firm WorldPay.

The two companies said on Wednesday that they are linking up to offer Irish companies the ability to trade securely on-line using services such as WorldDirect, which allows businesses to set up an Internet trading account and accept credit and debit card payments via the Web.

In addition, companies will be able to establish their own on-line trading sites that can accept multi-currency transactions securely using WorldPay's on-line payment system, said Digiweb.

Meanwhile, figures released on Wednesday by the Census Bureau of the US Department of Commerce showed that e-commerce spending in the US continues to rise. Sales totalled USD9.85 billion in the first quarter of 2002, up nearly 20 percent from the same quarter a year earlier.

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