Self-checkout lanes help grocers drive efficiency, maximize margins.
While the cost of food and consumer packaged goods have seen measurable increases in recent quarters, grocers aren't reaping the rewards. In fact, rising prices have shaken up the grocery industry, testing the loyalty of consumers and the mettle of grocers who typically operate on margins as slim as 2%. The economics of selling groceries are tricky, but many grocers have found some breathing room in technology investments. One tech investment that's holding its own is self-service technology, specifically self-checkout. Here, Jim Vance, president of self-service technology provider Pan-Oston, and noted grocery authority Phil Lempert, 'The Supermarket Guru,' share some insight into the case for self-checkout.
What are the primary drivers of self-service technology adoption in retail today?
Vance: Increasingly knowledgeable and demanding consumers are seeking quality, speed, and convenience (especially at the checkout). Consumers are demanding more control over their shopping experience. For instance, many are particular about how groceries are handled and bagged. They prefer to bag their groceries themselves so that unbagging at home is more convenient. Consumers also seek convenience in the ability to purchase items whenever they want without waiting. Privacy is another factor — consumers seek the ability to purchase sensitive items discreetly. And lastly, consumers seek to ensure that what gets scanned is the right price and at the right quantity. They want the ability to ensure what was paid for actually arrives home.
Lempert: The primary driver of self-service technology is our desire to satisfy the needs of our shoppers who are hassled, time pressed, and want to be in control of the shopping (and checkout) experiences.
What are the most recent technological advances in self-service technology?
Vance: The self-checkout station presents a host of technologies. Cash and coin recycling, biometric security, virtual imaging, bottom-of-cart viewing, direct-to-shopping cart merchandising, GPS (global positioning system) shelving, PDS (product data sheet) price verification, RFID (radio frequency identification), and interactive kiosk technologies are but a few of them.
Lempert: Building checkouts ergonomically to meet shopper needs, rather than to meet the needs of the supplier, is a recent advance. When a shopper uses ergonomically designed self-checkout stations like the Utopia lanes from Pan-Oston, they feel like Captain Kirk at the helm of the Starship Enterprise. Everything is positioned for their ease of use and bagging.
What impact have these advances had on the customer experience (benefits to consumers)?
Vance: The technologies drive efficiencies and control throughout the shopping experience. Customers are able to utilize these technologies to improve their convenience, privacy, knowledge, and cost-effectiveness.
Lempert: Technology empowers consumers to use self-checkout and eases the stress of the checkout experience.
What impact have these advances had from an operational standpoint (benefits to retailers)?
Vance: Self-checkout enables better operational efficiency and lower costs, increased sales opportunities with better margins, and an enhancement of brand loyalty.
Lempert: Self-checkout is key to easing the burden on those checkstands that are staffed, reducing labor costs, and, most importantly, having more satisfied shoppers.
What will the next generation of self-service look like?
Vance: Next-generation self-checkout systems are more streamlined, with easier access to all customer interactive points, along with greater set aside space and various bagging options. Like Utopia, they leverage .net technology and integrate easily with much of the hardware peripherals currently available.
On The Web: Get Matt Pillar's opinion on self-service in a down economy at ismretail.com/jp.
Lempert: The next generation of self-service technology will look much like the Utopia does physically. As technology platforms evolve, there will be even more functions to help shoppers, including advanced meal planning and messaging to home appliances. Self-service of the future will extend to the consumer's home. Devices will start the oven remotely so it's at the correct temperature by the time the shopper arrives home with the ingredients for that day's meal. Retailers will be allowed to customize messages to the individual shopper thanking them for their visit, as well as offering them paperless coupons, recipes, and advance information on upcoming specials, which can then be downloaded to their mobile devices.