How should self-checkout be incentivized?

Discussion
Photo: Asda
May 22, 2017
Tom Ryan

In the U.K., Asda’s customers, at least in some situations, have to use the self-service checkout lane if their purchases amount to less than £100 ($130).

The revelation came in a Daily Mail article about a customer vowing to boycott the grocer after she was forced to scan 60 items worth over £120 at one of the Walmart-owned chain’s stores.

In the U.S., it has been suggested that retailers could offer a discount for using self-service, similar to incentives often provided by banks and airlines. But having ample terminals and trained personal nearby to handle any problems to support a hassle-free self-checkout experience appears to be the current way to provide some motivation.

The best example I’ve seen of encouraging self-checkout use is at a CVS on 1st. Ave and 15th St. in Manhattan. Four self-checkout terminals are lined against the front to the store. Two associates are stationed to greet customers as they enter, inquire if they need help finding anything and also assist with any issue using the self-checkout terminals. While there are two manned registers on the side, usually only one is being used. Only one of self-scanners could handle cash.

While preferred for speed, self-checkouts work best for small baskets of items. Some customers are frustrated by the technology and the occasional glitch.

While Albertsons Cos. last year earned press for getting rid of its self-checkout lanes in order to give better one-on-one service to shoppers, self-checkout is expected to continue to slowly expand as the technology improves and retailers seek to reduce costs. Zara and Rebecca Minkoff surprised many last year for adding self-checkout options to some of their stores.

Rebecca Minkoff CEO Uri Minkoff told WWD last December, “More and more we are seeing Millennials want to be in complete control of any and all of their shopping, and that includes payment.”

DISCUSSION QUESTIONS: How should shoppers be encouraged or incentivized to use self-checkouts? What is the biggest inhibitor to using self-checkouts?

Braintrust
"When the technology is truly labor-saving then we will see it everywhere."
"Should retailers try to force customers into self checkout, look for a number of customers to take their business elsewhere."
"...self-checkout is likely to increase in the next five years until we move to the next evolution of checkout — scanless checkout."

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29 Comments on "How should self-checkout be incentivized?"

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Kai Clarke
BrainTrust

Self-checkouts will continue to grow until all checkouts are replaced by the smart shopping cart. Once consumers place a product into a cart, the cart should be able to read the products in the cart, show a detailed list of which products are in the cart along with their prices and then simply charge the consumer’s payment system (Apple Pay, Samsung Pay, Pay Pal, Visa, etc.) as the consumer leaves the store. Simple, easy and cheap. The cost of connecting carts to a wireless network in the store (which almost all stores in the U.S. already have) is less than paying for cashiers, POS systems and the consumer aggravation of waiting in line.

Bob Phibbs
BrainTrust

This topic comes back from the dead like Sears. As much as people try to make self-checkout personal, it isn’t. It only takes one or two glitches and having to wait for some harried cashier to “fix” it to make customers feel stupid they picked the “quicker self-serve” option. No one ever uses the Lowe’s self checkout near me for that reason. Once burned, customers are never going back. For a single item in a store where most of the items are similar it’s fine, but most retailers aren’t boutiques with only 100 SKUs.

Gene Detroyer
BrainTrust

It is an interesting experience at Lowe’s. At my Home Depot it is quite the opposite. Manned lanes are unused while people wait to use self-checkout. Personally, I find self-checkout faster than manned checkout. I don’t know if it is real or just a perception. I see a similar phenomenon at the local CVS.

Sterling Hawkins
BrainTrust

Self checkout needs an overhaul. It’s often more of the same with glitches and unnecessary “customer assistance” required scenarios. There’s an opportunity here to make real convenience the incentive. If retailers are incentivizing customers to use self checkout beyond convenience the experience is broken. There’s a whole generation of technologies — including mobile phone based self checkout — that can offer true convenience and create a win for both the users and the retailer.

Dick Seesel
BrainTrust

I do expect to see more self-checkout options over the next several years as customers become more familiar with the process and retailers realize cost benefits. In my neighborhood there are two Roundy’s (Kroger) groceries within five miles of each other — one with self-checkout, the other without. Shoppers who are comfortable with the self-scanning process seem to prefer it for small baskets of goods instead of standing in the so-called express lane. And the stores who use the system (Home Depot being another example) have figured out how to have an associate nearby to help out.

There is a learning curve for shoppers and retailers, just as with chip-enabled credit cards, mobile payment and so forth. To win customers over to the benefits of self-checkout, it may take adaptation by a huge player like Walmart … if they’re not already on board.

Steve Montgomery
BrainTrust

“Self-checkouts work best for small baskets of items” should be the mantra for those considering their deployment. Customers with a large number of items may not mind being behind others with similar-sized purchases. However those with just a few items really hate being in the same line as people with big orders.

We all know that the checkout process is the least liked part of the shopping experience. Making customers with 60 items do a self-checkout is punishing them.

I’m not sure what the incentive should be in terms of a discount but if I had 60 items and was told to use the self-checkout, I would walk out of the store.

Bob Amster
BrainTrust

Once the consumer learns how to use self-checkout, it is faster to pay and get out of the store. That is and should be the incentive. For those consumers for whom self-checkout is a challenge, no reasonable incentive will be enough to make them use it. Younger generations will have no problem embracing it.

Liz Crawford
BrainTrust

The self-checkout options will continue to proliferate (loved or despised) until we see improved automation.

The problem isn’t self checkout per se — it’s the clunky technology. When the technology is truly labor-saving then we will see it everywhere. Until then, shoppers are performing the labor usually reserved for store personnel.

Cathy Hotka
BrainTrust

Oddly, a major grocery store near me forces customers with MORE than 12 items to use self-checkout. About three minutes in, the system starts barking at the customer to remove items from the belt. While the customer is bagging and removing those items, the system assumes the transaction is over and starts yelling for a credit card number. Clearance items can’t be processed without human intervention because the system assumes they’re fraudulent. I stopped going there.

Bob Phibbs
BrainTrust

Exactly Cathy. Who wants to go grocery shopping and then be told what to do? It’s like, whoa, am I on the schedule today? Add the nagging voice after every scan and I don’t know who thinks this is humane or preferable for anything more than a pack of gum or a Coke.

Adrian Weidmann
BrainTrust

Make certain it works! And make certain there is a qualified person who is readily available to override and address problems. Nothing is more annoying than when the systems locks up and you have to wait until you get assistance. This method with never be personal so get over it! Retailers invest in this technology to reduce headcount. Just make certain it works!

Meaghan Brophy
BrainTrust

Preferences for self-checkout and regular checkout seem to be pretty divided. I think the key for retailers is to provide both options so shoppers have a choice. I’m not sure self-checkouts should be incentivized. Speed and control are enough incentives for many customers to choose self-checkout. The other half of the population that prefers regular checkout values the human interaction. They shouldn’t feel like they are being punished for having that preference.

Max Goldberg
BrainTrust

Retailers want consumers to use self-checkout but need to make traditional checkout available to those who want to use it. It’s a matter of servicing customers. Should retailers try to force customers into self checkout, look for a number of customers to take their business elsewhere.

Lyle Bunn (Ph.D. Hon)
BrainTrust

Retail checkout and fast food drive-thru ordering have the same problem and, in each case, consumers want to minimize the wait and processing time. When time matters (as it increasingly does for customers), more efficient approaches will be welcomed. But the caveat is that it must work. One too many interventions being required in the process can negate forward momentum and negate the benefits that both the consumer and establishment expect to enjoy.

Art Suriano
BrainTrust
There is no doubt that self-checkout provides one key benefit: convenience. There is nothing more infuriating than having an item or two and lines at the register that are four or more deep with customers holding several items each. However, too many retailers don’t realize the disadvantages their self-checkout causes to their business. The most common disadvantages are glitches when an item will not scan or when the customer has a coupon for the purchase but the self-checkout can’t scan it. Often self-checkouts, depending on the store, are understaffed with only one associate there to assist customers when several self-checkouts are being used simultaneously so when one customer has a problem, anyone else with an issue must wait. That said, if retailers looked at the self-checkout opportunities carefully they should see that many customers enjoy using them because they can be fun and most importantly provide speed to get out of the store. So make sure your scanners are working properly, staff the area with enough associates to help customers with issues and ensure that the associates are friendly and making the customers feel welcome, thank them for shopping and invite them back. The little human touches will go a… Read more »
Christopher P. Ramey
BrainTrust

There’s no need to incentivize self-checkout in price-oriented stores. It will grow as technology allows it to be seamless. Let’s not kid ourselves into believing that checkout as we know it is pleasurable or personal.

Time is important and so is the experience. Most shoppers aren’t looking for a friend. Conversations with cashiers are meant to be short and to the point. Anything else wastes time, annoys the people behind the first customer and is usually disingenuous.

Want to make checkout or final moments with your store more pleasurable? Eliminate it or deflect it.

Doug Garnett
BrainTrust

We enter dangerous territory if we start trying to control consumer actions in the store with incentives. Incentives too often backfire and create dysfunction.

We can see the dysfunction that might come by looking at the example noted above — the airlines. Yes, they have started micro-pricing all parts of a trip. And the result is incredibly frustrated flyers who struggle to comprehend what all is happening. The only way airlines have controlled this blowback is by keeping prices so low that they are unrealistic (I can fly in four hours from Portland, OR to Chicago for less than the cost of gas to drive there in two days). That has increased consumer expectations for extraordinary service without pricing or margins that make that service possible. It’s a train wreck, so to speak.

My recommendation: We should have both types of checkout and allow consumers to choose. It is the store’s job to staff in order to level the load. And that should be it.

Sunny Kumar
BrainTrust
In the U.K., superstores have used a number of different methods to enable self-service. From hand-held scanners to self-serve checkouts like the ones being discussed to click-and-collect (buy online, collect in store). The ones we see more and more of are the self-serve checkouts. I’m guessing the supermarkets have a better ROI with this than the other methods. Clearly someone with a £120 shopping bill using a self-scanning machine qualifies as both a poor experience and poor customer service — for the person doing the shopping and for the growing queue of people waiting. Hence the context needs to be considered. What are the qualifiers for using the self scan machine? I suspect Asda are playing with this formula to further increase efficiencies. As to the process of checkout itself, why do the self-checkouts always seem to always stops working? More time and effort should be spent in making the process of checking out more intuitive and easier for customers. The interfaces seem to be getting better but they could be a lot better still. To encourage customers to use self-service checkouts increased loyalty incentives should be considered as well as more innovative features such as special discounted lanes, simpler… Read more »
Ricardo Belmar
BrainTrust

The problem with most current forms of self-checkout in stores is that they are not designed to make the process easy, seamless or positive for the shopper. Instead they are designed to solve a problem for the retailer. This lack of customer-centricity produces more friction in the checkout process rather than reducing it. The exception to this is the mobile and/or app-based checkout in luxury brands like Apple and Rebecca Minkoff, or the check-in approach demonstrated by Amazon Go. Until self-checkout systems are designed from a customer-first viewpoint focusing on the customer’s needs rather than the retailer’s, these systems will fail more often than not. It only takes one failure for a customer to not come back to the store if forced into this sort of non-functional experience.

Tom Erskine
BrainTrust
1 month 29 days ago

Self-checkout should not be incentivized at all. It is rare that incentivizing consumers to change their behavior works. Customers change from “behavior A” to “behavior B” when the new one becomes more convenient, period.

Once self-checkout works seamlessly and consistently, I have full confidence that consumers will naturally make the right choices whether to use it or to use assisted checkout.

Ed Rosenbaum
BrainTrust

Self-checkouts are a given for the younger generations, especially Millennials. But for us older generations, using a self-checkout can be a challenge. This will be the case until the younger generations become the older generations. I have attempted to use it at several stores. Some have been successful, others have been a challenge. If there is not someone close by to assist you the line can become longer behind you, causing some discomfort.

Ralph Jacobson
BrainTrust

I remember when a national supermarket chain stated that all new stores will have 50 percent self-checkout terminals. That was more than 10 years ago. That never transpired. As a non-scientific survey, I can say that the technology is hit or miss a bit too often for me to gamble on checking out more than just a few items on my own. The other piece is that the stores need to have the staff assigned to self-checkout terminals (it STILL sounds like something’s inherently wrong with that premise) and need them to remain far more productive than they are currently in most stores.

When shoppers consistently feel that self-checkout truly saves time and provides the choice and control in their shopping experience that they desire, then retailers won’t need the incentives they do today.

Ken Morris
BrainTrust

Self-checkout has had its ups and downs over the years as there is a fine line between convenience and frustration. Millennials and younger generation are much more accustomed to using technology than Baby Boomers and The Silent Generation (born between 1924 and 1945) and many young people prefer to interact with technology more than with people.

Many retailers initially embraced self-checkout for high-volume, low-touch items such as grocery, but now we are seeing luxury fashion such as Rebecca Minkoff experimenting with self-checkout. From a cost and labor scheduling standpoint retailers realize the benefits, but depending on the product category and customer demographics they must be careful not to alienate their customers with a frustrating experience.

Until nearly all consumers adopt self-checkout, retailers will need to offer a hybrid approach of a combination of traditional associate-staffed checkout with self-checkout. Offering incentives to accelerate the adoption of self-checkout is a good idea, even if it is just a 1 or 2 percent discount.

With the cost pressures and difficulty finding available labor, self-checkout is likely to increase in the next five years until we move to the next evolution of checkout — scanless checkout.

Ron X
Guest
1 month 29 days ago

Banks initially gave people incentives to use ATMs. Then some tried to charge extra for seeing a live person. Now ATM fees are common and online banking is being incentivized. Self-checkouts fit into the service mix for many grocers. People may perceive it as faster to scan their own purchases instead of having a professional scan them. Issues of technology breakdowns, higher shrink, lower front-end sales, costs and customer acceptance should limit adoption of incentives to use self-checkouts.

Craig Sundstrom
Guest

You can lead a horse to water but you can’t make him serve himself? It’s no mystery why stores want people to make use of this, and certainly it should be available as an option (when possible), but beyond that I don’t see why people should — or even can — be “incentivized” to use it. Certainly forcing people seems like a dumb idea.

There are all kinds of behaviors stores might like — wouldn’t it be great if no one wanted to shop after 7PM or only drove small cars so we could restripe the parking lot? But customers ultimately determine what services stores offer … if they want to stay in business.

Phil Rubin
BrainTrust
1 month 28 days ago

The encouragement, where appropriate, to use self-checkout is simple: it’s a better experience than waiting for a live cashier. When it’s not, customers will not want to use it, or use it reluctantly. In terms of inhibitors, a longer line is the obvious starting point, much as a long line in a staffed check-out is an inhibitor to using that versus self-checkout.

Like so much of retail, it comes down to people and systems. Self checkout is always shorter at Costco, which also staffs the self-checkout lines for when you purchase wine which requires human intervention for age/ID validation.

Also, like so much of retail, companies need to shift their thinking from discounts as the only way to motivate customers. The power of a better customer experience is not only more powerful, it’s more profitable.

gordon arnold
Guest
One of the consumer standout incentives for self checkout is quicker service. Few large or assistance required orders attempt self checkout. Adding maintenance and upgrade costs as well as security and associate needs to the predominant low margin and small receipts that thrive in self check out makes it a wash for the store. That makes incentives an added burden for the company. In economically distressed locations, we see self checkout being abandoned or limited due to expanding shrink results. Lowering prices and margins has resulted in service issues that more often than not offend consumers. The stores are being stripped of payroll dollars needed to operate efficiently. Companies must look to the layers of often unnecessary or redundant high-priced employee funding that could be used to provide payroll dollars for ordinary associates and cashiers. All too often there are a lot of managers running around the store looking for associates and cashier help when there are none on duty. Too many chiefs and not enough Indians is a core reason for consumer abandonment. And finding quality retail management is an issue, largely due to abandoning the direct hire responsibilities by executives with result demands for placing quality managers. As… Read more »
Shep Hyken
BrainTrust

There is a learning curve to self-service solutions. Think about how long it took to get airline passengers to book tickets and check-in online. It was years. Incentives ranged from cash discounts to extra frequent flier miles. But it worked. There was a tipping point and now it is more the norm and not the exception. Retailers must do the same. Give a reward for usage. It will only work when the customers get comfortable with the system. That means the retailer must train the customer.

JJ Kallergis
BrainTrust

Why are retailers still considering the Band-Aid of self-checkout in the era of Amazon Go? IMHO because they are lazy and because there could be some potential labor savings. On the one hand, we appreciate self-checkout if it helps with speed and queue management. On the other, it is a very impersonal and oftentimes frustrating experience.

Should retailers incentivize self-checkout by customers? Perhaps monetarily, since it is offering an overall inferior customer experience. But there are certainly other ways to do it. Gamification either on the store’s self-checkout POS terminal or on their mobile app could sway customer behavior and engage a younger generation of shoppers. Or a timer that shows you how much time you saved versus going to the manned checkout line could be an interesting proposition.

Every store and their respective customers are different. So what about an instant feedback mechanism to gauge how satisfied your customers are with the service — similar to the feedback you can provide on the Uber app? This might be a good first step for retailers considering this direction.

wpDiscuz
Braintrust
"When the technology is truly labor-saving then we will see it everywhere."
"Should retailers try to force customers into self checkout, look for a number of customers to take their business elsewhere."
"...self-checkout is likely to increase in the next five years until we move to the next evolution of checkout — scanless checkout."

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