Our world is evolving at a pace never seen before, and nowhere is this more so than in retail. Whether it be online deliveries, TikTok shopping or digital stores such as the Future Stores concept in London, our shopping experience is changing like never before. And there’s one area where this is having a profound impact not just on our shopping journeys but our entire shopping experience: self-checkout.
Self-checkout has for years been a vital ingredient for the grocers; however, with the headwinds of the Budget measures, the impact and uncertainty of President Trump’s tariff measures, and higher prices impacting consumer confidence and spending, more and more retailers are driving increased efficiency and productivity. And in many cases across all sectors of the industry, this means self-checkout.
Fashion is the latest sector to embrace the technology, however, it is becoming ubiquitous across luxury, general merchandise, and DIY, to name a few.
Why self-checkout?
There are many benefits to both the customer and the retailer to self-checkout. For the retailer, it is the aforementioned efficiency gains, translating into cost savings in the workforce. For customers, it not only reduces wait times at the checkout but also streamlines and improves the payment experience. However, both of these benefits for retailers and customers depend much on one key ratio: the number of store associates to self-checkouts.
The common ratio appears to be anywhere between 1:6 and 1:8; however, this, of course, depends on the day, time of day, and other factors such as the weather, whether there’s an upcoming Bank Holiday, key event, and so forth. All of this makes the task of optimising for both retailer and customer a complex one.
Self-checkout can also seamlessly integrate with loyalty programs, enhancing customer engagement and retention, not to mention basket size. As the task of attracting and retaining customers becomes ever more challenging, this is an important consideration.
Growing pains
A decade ago, virtually the only sector where self-checkout was deployed was in grocery. And this wasn’t without its problems. “Unexpected item in bagging area” rapidly grew to encapsulate all our frustrations with the fledgling technology, which constantly required manual intervention in order to complete the process.
Fast forward to today, and that is mainly a thing of the past in a world where technology has dramatically improved. One area where this is particularly so is in reducing theft, otherwise known as shrinkage. As shoplifters’ methods have become more and more sophisticated, so the technology has evolved to match.
The latest example is the integration of AI into self-checkout kiosks in order to not only identify fraudulent behaviour but also alert a member of staff to it.
Customer preference
From being perceived as something of a barrier to a positive customer experience, such is the need today for an effortless journey through the store, that self-checkout is now amongst many shoppers, the preferred method. A study in 2021 said that 80% of in-store shoppers like the idea of a non-traditional checkout, with 66% saying that these are the optimal options for them. Furthermore, speed and reduced wait times were cited as key benefits of the self-checkout.
According to another recent study (sign-in required) commissioned by The Grocer:
- 54% of shoppers choose self-checkout as their preferred option versus 30% who use manned checkouts and 16% who have no preference.
- 67% said that their local supermarket had ‘just the right amount’ of self-checkouts.
- When doing a top-up shop, 79% of respondents say that they use self-checkout, and 50.2% said that they use it most of the time.
And whilst there are many, even in the industry, who say that it is important to offer customers a choice, the number of self-checkouts in the UK now stands at over 80,000 and counting. It seems that installations of self-checkouts is only going to increase.
This is leading to many retailers, especially in the fashion sector, to design much of their store around the checkout, such is the importance of completing the customer journey in a seamless fashion.
Journey of discovery
However, it’s not simply a question of installing the technology and hoping customers will use it. Consumer psychology and transformational change have a lot to do with whether customers are drawn to use it or remain with familiar manned checkouts.
Outside of the grocery sector, just about every retailer who is deploying the technology is on a journey of discovery, trialling what configuration and layout work best in order to maximise the transaction throughput of their self-checkout lanes.
Even making subtle changes to signage, the queuing process, and how the self-checkouts are located relative to those which are manned can have a significant impact.
Self-checkout is rapidly becoming part of the checkout experience that customers expect. With an unprecedented growth of automation in retail, it remains to be seen whether, one day, retail will be 100% self-checkout. Whilst this may appear to some to be something of a dystopian vision, there is no doubt that we will see more and more of this technology in the years to come.
Andrew Busby, Senior Industry Expert at BOXTEC