Self-checkout remains the hottest topic in retail. Does it enhance the shopping experience, or is it on its way out?
The idea of the systems – also known as checkout kiosks or checkout machines – was simple: empower customers to scan items and complete their purchases without needing assistance from a cashier. But while self-checkouts offer various benefits, many consumers have voiced their dissatisfaction since their advent. Here, we’ll explore the advantages and disadvantages of self-checkout systems…
Advantages of self-checkout
1. Quicker checkout
One of the primary advantages of self-checkout systems is their speed. Our recent Retail Technology Report, which contains insights from over 100,000 consumers, found that speed was the most important factor for customers using self-checkout. However, what consumers define as “fast” or “easy” varies wildly, depending on whether you find self-checkout a total breeze or a bewildering nightmare—or what you’ve come in to buy. Within every vertical we looked at, checkout preference was split.
Download the Retail Technology Report
2. Reduced labor costs
Implementing self-checkout systems can significantly reduce labor costs for retailers. With fewer cashiers needed at traditional checkout stations, businesses can reallocate resources more efficiently. One employee can supervise multiple self-service registers, contributing to cost savings without compromising service quality.
3. Enhanced customer experience
Many customers prefer the convenience and autonomy offered by self-checkout systems. Self-checkouts provide a sense of empowerment to customers, allowing them to complete transactions at their own pace. According to recent findings from NCR Voyix Corporation’s Digital Commerce Index, self-checkout is gaining momentum, with 43% of consumers prefer it over traditional checkout methods. Moreover, a generational analysis reveals that younger shoppers, particularly, are embracing self-checkout for its speed, shorter lines, and privacy benefits.
4. Space optimization
Self-checkout kiosks require less physical space than traditional cashier systems. By implementing these compact stations, retailers can optimize floor layout and allocate space for additional sales or services. This flexibility is particularly beneficial for smaller footprint stores seeking to maximize their retail space.
5. Better data gathering
Self-checkout systems allow retailers to gather valuable insights into customer behavior and preferences. Businesses can benefit significantly from integrating point-of-sale feedback solutions, such as TruRating. These solutions help collect real-time customer feedback during checkout, allowing retailers to make informed decisions about their product offerings, pricing strategies, and overall service improvements. This data is crucial for enhancing the shopping experience and driving customer satisfaction.
6. Customized promotions and offers
Self-checkout systems can be integrated with loyalty programs and customer databases to deliver personalized promotions and offers based on individual purchasing history and preferences. By tailoring promotions to specific customers, retailers can increase customer engagement, encourage repeat purchases, and foster brand loyalty.
7. More customer privacy
Self-checkout offers customers a sense of privacy by allowing them to complete transactions without the need for direct interaction with store staff. This privacy is particularly valued by shoppers who prefer discretion when purchasing certain items or those who prefer minimal social interaction during their shopping experience.
Disadvantages of self-checkout
1. Increased risk of theft
One of the primary concerns associated with self-checkout systems is the heightened theft risk. According to a recent Financial Times report, retail chains experienced a surge in theft incidents, leading to significant financial losses and operational disruptions. Adopting self-checkout systems and reduced staff presence creates vulnerabilities that opportunistic thieves and criminal groups exploit.
2. High up-front costs
While self-checkout systems offer long-term benefits, they often require substantial initial investments. Additionally, ongoing maintenance and security expenses further contribute to the total cost of ownership, posing financial challenges for some retailers.
3. Customer confusion and choice
Not all customers are comfortable using self-checkout systems, leading to potential confusion and frustration. Generational differences in technology adoption underscore the importance of user-friendly interfaces and comprehensive customer support.
In last year’s 2023 TruRating SCO Report, we found that customers generally reported a better experience when using manned terminals. However, problems arise when customers perceive self-checkout as the only option. As many as 1 in 5 customers reported issues with the ease of self-checkout, and customers may not appreciate the convenience factor if it feels like it’s being forced on them. It was also observed that customers spent 29% less when they felt like self-checkout was the only choice.
4. Impersonal experience
While self-checkout systems offer efficiency, they may lack the personal touch of traditional cashier interactions. For retailers, this could diminish opportunities for upselling, cross-selling, and fostering customer loyalty. Maintaining a balance between automation and personalized service is essential to meeting customers’ diverse needs.
5. Lack of human contact
For some consumers, the absence of human interaction at self-checkout stations can detract from the overall shopping experience. Human contact is crucial in building rapport and trust between retailers and customers. By solely relying on self-service options, retailers risk alienating segments of their customer base who value interpersonal connections.
6. Technical issues and maintenance costs
Self-checkout systems are prone to technical glitches and hardware malfunctions, disrupting the checkout process and frustrating customers. Retailers must invest in regular maintenance and repairs to ensure the reliability of these systems, adding to operational costs. Additionally, prolonged downtime due to technical issues can result in lost sales opportunities and damage the retailer’s reputation.
7. Complexity for certain items
Self-checkout can pose challenges for customers when handling complex or non-standard items that require additional verification or assistance. Products with irregular shapes, damaged barcodes, or age-restricted items may trigger errors or prompts during checkout, leading to frustration and delays. Moreover, customers may need help to weigh produce or input customizations for certain items, further complicating the self-checkout experience.
The future of self checkout?
Take a deeper dive into self-checkout at our next webinar on 11th July 2024, at 11:00am EST / 4:00 PM BST. We’ll present our latest research findings from our consumer study and highlight some of the most surprising discoveries.
We’re also delighted to be joined by Bill Zachopoulos, VP Store Operations at Longo’s. The award-winning Canadian grocer brought in self-checkout based on customer feedback, and Bill will share what the company’s seen post-implementation.
Find out more and register now to secure your place.
Download our Retail Technology report below for a comprehensive analysis and in-depth insights into all types of retail tech. You can also learn more about our retail experience platform and how you can gauge your customers’ true opinions about your technology.
