The owner of Dixons has unveiled plans to scrap its "bricks and mortar" operations on the high street after nearly 70 years and instead focus the electrical retailer's brand name exclusively on the web.

DSG International, one of Europe's largest retailers, is to spend about £7 million converting all 190 of its high street Dixons stores into the Currys format, as part of a move to encourage British consumers to buy their smaller techno-gadgets such as iPods and MP3 players online.

Although the new stores, to be renamed Currys.digital, will continue to sell a wide range of electrical goods, the idea is to exploit shoppers' increased willingness to buy products over the internet, while reserving their traditional high street spending for larger white goods such as fridges and freezers.

DSG hopes the move will save it £3 million a year.

DSG, led by chief executive John Clare, has been battling to stem a sales decline at its UK stores, which also including the struggling Link mobile phones outlet.

Sliding sales last year cut annual profits at the retailer by a fifth to just £106.1 million as it felt the damaging effects of the general downturn in British consumer sentiment.

Today, DSG said its decision had been prompted by the success of its existing e-commerce venture for Dixons, which has recorded year on year sales growth of about 50 per cent over the past four years.

"I am very excited about the prospects for the Dixons brand as a pure play e-tailer. Customer buying behaviours are developing with the growth in broadband usage and, as a group, we constantly adapt and innovate to support how our customers shop," Mr Clare said.

"Customers of both brands will have greater opportunity to buy what they want, where they want and how they want - back by our commitments on price, range and service."

Dixons shops have had a presence on the high street for almost 70 years. Rebranding all over the stores under the Currys.digital format is expected to start next month and will eventually see a national network of 550 stores.

DSG said that no job losses are expected to result from the move.

Chris Lake, who advises businesses in their internet strategy working for e-consultancy, said: "The re-badging of Dixons to Currys.digital is a bold move by DSG, and no doubt a reaction to fierce price competition and declining profit margins.

"Online retail is an area where companies can level the playing field, reduce costs and improve customer service, so long as best practice is adhered to.

"Broadband-enabled consumers are increasingly using the internet to uncover the best deals, using shopping comparison engines like Kelkoo and Pricegrabber. While retailers like Dixons might be feeling a little pain, this is of course great news for consumers. After all, an iPod is an iPod, whether it costs £199 online or £229 in the high street."

Recent research carried out by e-consultancy found that shopping comparison engines can drive around 30 per cent of online sales in the consumer electronics sector, where price is a central factor.

The City was initially unclear on what to make of DSG's move. In the minutes following its statement about its plans, the shares were little moved, up just 0.75p at 185.25p.

Richard Ratner, head of equities at broker Seymour Pierce said it was a "sensible idea to develop e-commerce, but whether putting the whole high street/out of town operations under one fascia makes any difference is a moot point".

Mr Ratner held his forecast for the company's shares at "underperform".

The stock market values DSG at about £3.4 billion.

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