Retailers have been innovating with self-checkouts, but what are the key considerations for retailers and suppliers due to the shopper payment journey changing?
Retailers continue to battle against rising operating costs. A key efficiency-aiding solution has been the implementation of self-checkouts. Because of this, the shopper payment journey has changed, so retailers are deploying new tactics to win impulse sales and tackle the growing problem of shrinkage. With a changing payment journey, there are key considerations for retailers and suppliers.
The efficiency imperative
As part of IGD’s Global Trends for 2024, the efficiency imperative once again features as retailers fight to cut costs from their operations. Shrinkage reduction has become a key focus in 2024.
However, with many retailers already deploying self-checkouts to cut labour costs, we are starting to see further developments and innovation to maximise opportunities from the changing payment journey of shoppers.
Evolving self-checkout options
Across all modern retail channels, retailers are implementing self-checkout solutions to meet the needs of shoppers short on time.
Supermarkets were early adopters of self-checkouts, but recently have been redefining the area to support shoppers on their payment journey.
M&S in the UK has implemented a horseshoe-shaped self-checkout area, as part of a revamp of its store network. The design allows shoppers to see which checkouts are available from two entry points and then easily access them via the wide-open section.
Retailers, like Edeka and Carrefour, have also been adding screens at the entrance to the self-checkout area. These show which self-checkouts are either in use or free, allowing shoppers to quickly navigate to a free checkout to pay.
Hypermarkets are implementing extensive self-checkout areas, to help them to appeal to shoppers with convenience, top-up or food-to-go missions.
Auchan in Poland has added over 30 self-checkouts to complement its store re-design. The self-checkout area is close to its fresh fruit & vegetable and food-to-go assortments.
Discounters are finally adding self-checkouts across their store networks to support their efficient operations, which like hypermarkets helps to open them up to greater shopper missions.
Lidl has been adding XXL self-checkouts with larger bagging areas, to encourage trolley shops to checkout and pay this way.
Aldi Nord in the Netherlands has applied a discounter mentality to its self-checkout terminals, with only one barcode scanner to control costs and remote age verification. The self-checkouts also have a sleek design and great user interface, like that of a smartphone.
Convenience retailers, despite their small store size, have also been adopting self-checkout options for shoppers.
Zabka in Poland has been converting conventional tills into self-checkouts in its convenience stores. It is also adding slimline self-service terminals, enabling a quicker payment journey for shoppers during peak periods.
Drugstores are also seeing the benefits of implementing self-checkouts, with many of Europe’s leading banners adding solutions to their stores.
Interestingly, most have chosen not to have any security scales in the bagging area, despite the high-value products on offer. Scales have been deemed error-prone, so the retailers have chosen to prioritise the shopper journey over potential shrinkage.
Tackling shrinkage
The cost-of-living crisis has resulted in an increase in theft from stores. Self-checkouts have been identified as a potential source of both malicious and non-malicious shrinkage.
Retailers are now adopting solutions to reduce shrinkage via self-checkouts, with technology playing an important role.
Visible deterrents are an effective initial method to reduce the risk of shrinkage.
Some retailers have added a camera and screen to each self-checkout terminal, to give shoppers the impression that they are being monitored. FairPrice in Singapore has gone one step further, adding a large screen about the area that shows everyone operating a self-checkout terminal.
To ensure shoppers are paying for their shopping via self-checkout, retailers are corralling the area so that a receipt must be scanned to exit. With sustainability a factor, some retailers such as Aldi Nord, are implementing eco-that just have a barcode or QR code to open the exit barrier. QR codes are also linked to a digital receipt that can be accessed via a smartphone.
AI, combined with camera technology is becoming an important factor in helping to identify shrinkage via self-checkouts.
The technology can help to identify any miss-scanned items and alert either a store employee or the shopper that a mistake has been made. Cameras are deployed either overhead or integrated into existing self-checkout terminals.
Netto Marken-Discount is testing a solution from Checklens to help reduce shrinkage at self-checkouts. Checklens uses computer vision and artificial intelligence to identify discrepancies between items selected by shoppers and the actual shopping basket they registered.
Encouraging impulse purchases
With more and more self-checkout solutions being introduced into stores, the shopper payment journey is changing with the main difference being a reduction in queuing time.
Mainline checkouts have in the past been a great location for impulse purchase products, however with this journey changing retailers have been evolving their self-checkout proposition to capitalise on last-minute purchases.
Hebe in Poland, which is the drugstore chain of Jeronimo Martins uses its self-checkout to push promotional products. Upon selecting the ‘pay’ option, once all goods have been scanned, a message appears highlighting current promotional items that are positioned next to the self-checkout.
Carrefour has been introducing larger self-checkout areas and scan-and-go options at its stores in Poland. Some stores have implemented an elevated short track for soft drinks, leading to the entrance of its self-service area. It has also added slimline shelving units in between the self-checkout terminals for impulse confectionery.
More comprehensive in trying to encourage impulse purchase is Walmart US, with a range of shelving units and chillers around the self-checkout area to increase basket spend. Around self-checkouts, we are seeing a mix of impulse categories and promotional items from the grocery assortment being deployed by retailers.
Retailers are also using self-checkouts for CSR purposes, with UK retailers like Tesco running short-term donation campaigns for shoppers to round up their shop to the nearest £1 for charity. Self-checkout screens are great for delivering messaging to shoppers.
From top right clockwise: Hebe Poland promoting products, Carrefour Poland short track journey, Walmart US self-checkout furniture, Tesco UK charitable donation.
What does this mean for retailers and suppliers?
Due to this evolution, there are some key considerations for self-checkouts:
- Do you have space around your self-checkout terminals to effectively merchandise products?
- If you will likely encounter queues for your self-checkout area at peak times, what store furniture can you deploy to showcase impulse products?
- What is the short-track journey self-checkout users will follow and can impulse products be merchandised along this journey?
- Digital screens on self-checkouts can be utilised for shopper messaging and retail media purposes. To secure impulse purchases, ensure these products are merchandised in close proximity.
- Can you add personalisation at the self-checkout, with bespoke communication based on shopper insights from loyalty cards?
- Increases in shrinkage have been associated with the deployment of self-checkout options, do you need to consider shrinkage reduction solutions to alleviate this risk?
