Journal logo

It’s a Fact: Older Americans Are Not Using Self-Checkouts in Their Shopping, Even as Retailers Rush to Implement a Self-Service Environment

by David Wyld 2 months ago in industry
Report Story

Major retailers today face a very real conundrum. The combination of new technologies and a labor shortage are pushing stores to eliminate cashiers. The only problem is that a majority of people still prefer a person over a machine when they are spending money in stores today. Here’s a look at 3 ways retailers can move toward a better, frictionless checkout future.

It’s a Fact: Older Americans Are Not Using Self-Checkouts in Their Shopping, Even as Retailers Rush to Implement a Self-Service Environment
Photo by Simon Kadula on Unsplash

Overview

If you want to “stir the pot” at any social gathering today, one topic that will ALWAYS get people talking is to mention using a self-checkout when you go shopping. Just bringing up the topic will lead family, friends, and coworkers to almost always vent about a bad experience (or 2 or 3) that they had while simply trying to checkout at their local grocery store, big box store, or home improvement store. Rare is the time that someone - particularly those “of a certain age” - will say that they had a “good” or even “satisfactory” experience trying to scan and bag what they were buying and then trying to pay for it.

Now certainly, self-checkouts are becoming more and more common with each passing month in the retail environment. The technology is becoming not just more omnipresent, it is, in fact, being made more “user friendly” as point-of-sale and payments companies seek to make the self-service experience better for consumers. Indeed, one of the top trends shaping the retail world today is the race to make the checkout experience as “frictionless” as possible. But even as Amazon expands its Amazon Go

… and Amazon Fresh stores,...

… where customers can pick out what they want and simply walk through a checkpoint for payment to be electronically collected from their phones, this kind of technology, even as it is being piloted by chains line Aldi and Giant Eagle domestically and Tesco in Europe, is years, perhaps even a decade or more, away from becoming commonplace. And even then, with challenges in electronically tagging all items for sale and concerns over inventory control and payments, some major parts of the retail world, including mass merchants like grocery and drug stores and high-end retailers like jewelry and electronics stores, may never really see such contactless checkouts ever be practical for use in their environments.

And let there be no doubt that today’s labor shortages impacting the retail industry - and the resulting rise in staffing costs to attract and retain frontline store workers - only exacerbate the need for retailers to try and shift more and more of their checkout processes in store to having customers serve themselves, rather than staffing checkouts with a real live human being.

However, there is one huge factor that is working against the retail industry’s collective march towards a self-checkout future. What is that you ask? Simply put, this is the fact that a majority of people today do not want to use the self-service checkout option, preferring - actively preferring - to have a store employee check them out. In this article, we look at the most recent research on consumer attitudes towards self-checkouts and explore potential ways that retailers can convince skeptical, even hostile consumers - particularly older Americans - to make use of self-checkouts.

How Americans Feel About Self-Checkouts

The data analysts at CivicScience recently published their latest research (“Checking Out in 2022, From Self-Checkout to Amazon’s ‘Just Walk Out’ Tech”) on Americans’ views about using self-checkouts (they have been annually publishing a report in self-checkout technologies in retail since 2018), and their findings should be of concern - real concern - to retailers everywhere - and to those companies whose businesses it is to make, install, and integrate this technology into the retail environment.

What they found was that even in 2022, the majority of American consumers are not sold - yet - on using self-service when it comes to the final act of their in-store shopping experiences. As can be seen in Figure 1 (U.S. Shoppers Preferences on Using Self-Checkout vs. a Cashier, 2022), a majority of shoppers (55%) would, given the choice, checkout with a cashier versus using a self-serve checkout or kiosk. Given the fact that even

Figure 1: U.S. Shoppers Preferences on Using Self-Checkout vs. a Cashier, 2022

Source: CivicScience, "Checking Out in 2022, From Self-Checkout to Amazon’s ‘Just Walk Out’ Tech," June 2022 (Used with permission)

if those who expressed no preference between checking themselves out of checking out with the aid of a cashier (14%) (i.e. depending on perceived waiting times based on the length of lines or the baskets of those in front of them), there is still a strong preference among American shoppers to opt to have a real live human being, a store employee, conduct the checkout!

Another key factor in the self-checkout calculus of shoppers today is the perceived likelihood that they will encounter a problem during their checkout (either scanning items and/or making payment for their purchase) that would require the intervention of a store employee. As can be seen in Figure 2 (U.S. Shoppers Reporting Problems Requiring a Store Employee’s Assistance to Resolve, 2022 vs. 2021), over two-thirds of American shoppers report encountering a problem serious enough to require worker assistance either very often (24%) or somewhat often (34%). Overall, this represents a 5 point increase year-over-year increase in consumers reporting that such issues arise often in their self-checkout experiences (68% in 2022 vs. 63% in 2021). The high frequency at which shoppers experience such problems using self-service checkout options not only defeats the purpose of enabling consumers to have a “frictionless” checkout experience - with less personnel needed by stores at the point of sale. Moreover, as the CivicScience researchers astutely pointed out: All of this “could be having a negative impact on growth of self-checkout preference, possibly deterring customers from opting for what is intended to be a quicker, more convenient user checkout experience.”

Figure 2: U.S. Shoppers Reporting Problems Requiring a Store Employee’s Assistance to Resolve, 2022 vs. 2021

Source: CivicScience, "Checking Out in 2022, From Self-Checkout to Amazon’s ‘Just Walk Out’ Tech," June 2022 (Used with permission)

Lastly, age appears to be the determining factor in terms of which consumers are the most - and least - likely to make use of self-checkout options. As can be seen in Figure 3 (U.S. Shoppers Checkout Preferences by Age, 2022), older Americans are far more likely to desire to be checked out by a cashier than their younger counterparts. In fact, shoppers between 18-34 are roughly evenly split between those who are likely to use a self-checkout option and those who prefer to be checked out by a cashier. However, the majority of those 35 and older prefer to be checked out by a store employee versus employing a self-serve option. And the strength of the preference grows with age, as 55% of U.S. consumers between the ages of 35 and 54 say that they prefer making use of a cashier, and the percentage grows to just over two-thirds (67%) of American shoppers who are 55 and older!

Figure 3: U.S. Shoppers Checkout Preferences by Age, 2022

Source: CivicScience, "Checking Out in 2022, From Self-Checkout to Amazon’s ‘Just Walk Out’ Tech," June 2022 (Used with permission)

Analysis

To me, as a strategic management consultant and professor, the big takeaway from all of this is that age is the major stumbling block that must be seriously taken into consideration as retailers push for greater use of self-checkout technologies in their stores. As the CivicScience research shows, ascending age makes a consumer far less likely to opt for self-service checkout options. And this is a reality that retailers - and the companies that are involved in designing and providing self-checkout technologies - must seriously consider as they develop both strategies for increasing not just the utilization of self-service at the final stage of the in-store shopping experience, but as they strive to make the experience a more satisfying and smooth one (and yes, working to decrease the error rates and need for human intervention will be a big part of this equation!).

Now there’s no doubt that major retailers see the proverbial “writing on the wall” that self-checkout is the future, especially in light of a labor situation that might not get better for them, at least for the next few years, if ever. And so what should be discussed in the C-suites of every major - and even minor - retail chain today is how do we “bridge the gap” - likely to me to be over the next decade or even more for most retail settings - between today’s self-checkout technology and the widespread use of “walk through” checkouts found today only in highly-select retail environments.

To me, retailers really only have 3 viable options that they can use singularly or in combination to shift more of their shoppers, particularly those 35 and up - who, oh by the way, have the most purchasing power, to not only make greater use of self-checkout options, but to be more satisfied with that experience. Checkout is the “last mile” of the retail service equation, and each checkout is a chance for the retailer to make a good, or even great, “last impression.” And remember, satisfied consumers are a very valuable asset for any retailer, as they spread positive “word of mouth” - both in the “real world” and online - about the companies they like! To create more satisfying - or at least less dissatisfying - self-checkout experiences, I would urge retailers to adopt one or a combination of the following strategies.

1. Reward customers who use self-checkouts with savings and/or prizes

Nothing motivates like money (despite what Frederick Hertzberg might have said)! And so perhaps the best way to motivate shoppers to make use of self-checkouts is to reward them for doing so. Now, some may ask why reward shoppers for something many would do anyway. Well, recall that a majority of consumers do prefer not using self-checkout options and checking out with a real, live person. To convert them, and particularly the older, more reluctant customers who are hesitant to use self-service options, it may be a cost-effective strategy - at least looking at it from a long-term perspective - to actually provide customers who use self-checkouts with a small reward. Depending on the nature of the retailer and the price points of the goods they sell, even offering say 1% off their total bill might motivate a considerable number of shoppers to shift to using self-checkouts. From a consulting perspective, I think it would be far more wise to provide an incentive (in the form of a discount) to shoppers making use of self-service checkouts rather than charging them with a surcharge (a dollar amount or a percentage of their total bill) for the privilege of being checked-out by a store employee. Think of it as the same kind of question as to whether a grocery store is wiser to charge a customer 5 or 10 cents for each plastic bag they use or to reward them with the same 5 or 10 cents off for each reusable grocery bag they bring to take away their purchases.

Even more effective (and cost-effective) might be for a retailer to make use of their reward programs to incentivize shoppers to use self-checkouts vs. manned checkouts. Offering customers a small, fixed incentive (i.e. 50 or 500 bonus loyalty points, depending on point values) on their rewards program account each time they make use of a self-checkout might incentivize many customers to bypass cashier options. Making use of customer data from their loyalty program, a retailer could really incentivize a shopper who had never used self-checkout to do so for the first time (i.e. say 5000 or 50,000 points). Likewise, a merchant could offer contests through their loyalty program for customers who use self-checkout to either be randomly awarded with prizes for doing so for a single transaction or to be rewarded if they use self-checkout a certain number of times in a set time period (i.e. say 5000 bonus loyalty points if they make x number of transactions in a month or a quarter).

2. Make more personnel available to help - and perhaps even create “hybrid checkouts”

With the growing concerns of shoppers over having problems arise when they make use of self-checkout options, this worry certainly makes consumers wary - and sometimes even avoid making use of self-service options, at least with certain kinds of items and/or in certain situations (i.e. being in a hurry). One way to alleviate these concerns is to have more trained personnel available at the point of sale who are specifically tasked to help customers with any issues that arise in the self-checkout process. While it has become almost standard practice for stores to have workers available to be able to help shoppers who encounter problems during the self-checkout process, retailers would be wise to not only increase the numbers of employees available to consumers, but to have them specifically focused - and yes, trained - for that task.

Even better would be to have a worker or workers who would be available to assist customers in what would be “hybrid checkouts,” where yes, a customer would be guided through the self-checkout process with the assistance of a trained employee. This would be a way of helping train customers on how to use self-checkouts and “convert” from being a cashier-user to a self-checkout user. And again, this would be a way specifically to reach out to older customers, who are the most hesitant to make use of self-checkouts. This would make investing in the effort to offer such hybrid checkouts a winning proposition for retailers.

3. Remove cashier options entirely

This may be the most radical approach for many retailers, but it might be the one that makes the most sense - at least in the long-term. Today, customers at stores like Walmart, Target and grocery stores routinely see half or more - often much more - of the cashier checkout lanes closed, forcing shoppers to have to choose between often waiting in a line for the 1-2 checkers who are available or to make use of the self-checkout options. Yes, a retailer might risk alienating - or even losing - a customer (perhaps even a number of them), especially if there customer base skews older (think drug stores). However, there may be some real value to this “tough love” approach. First, customers will migrate to the self-serve checkout. They may grumble, and some may even switch from one retailer to another over the availability of physical cashiers. However, with each passing year, cashiers are disappearing across the retail landscape, And so by eliminating cashiers entirely (but certainly, not eliminating those who assist customers with self-checkout “issues”), there may be a significant personnel cost savings to the retailer. Even if they do not eliminate such workers, they can redirect these human resources to more productive and meaningful (and yes, often more interesting for them) tasks, all of which helps in terms of worker productivity and retention. Finally, by eliminating cashier checkout options, retailers can take those former checkout lanes and convert that space into new sales space. In doing so, they can maximize their effective use of their stores and likely, boost same store sales in the process.

By Isaac Smith on Unsplash

Conclusion

In the end, this is a very tough strategic and tactical call for all retailers to make. However, management of these companies, from Walmart on down, must take a realistic, not idealistic, view of how their customers view self-checkout options as they stand today and proactively work to make their present processes better if they want to win over shoppers to the idea that "frictionless" checkouts can work for their benefit, not just the retailer’s!

++++++++++++++++++++++++++++++++++++++++++++++++++++

About David Wyld

David Wyld is a Professor of Strategic Management at Southeastern Louisiana University in Hammond, Louisiana. He is a management consultant, researcher/writer, publisher, executive educator, and experienced expert witness. You can view all of his work at https://authory.com/DavidWyld.

Social Media Links to David Wyld:

  • on Facebook
  • on LinkedIn
  • on Twitter

industry

About the author

David Wyld

Professor, Consultant, Doer. Founder/Publisher of The IDEA Publishing (http://www.theideapublishing.com/) & Modern Business Press (http://www.modernbusinesspress.com)

Reader insights

Be the first to share your insights about this piece.

How does it work?

Add your insights

Comments

There are no comments for this story

Be the first to respond and start the conversation.

Sign in to comment

    Find us on social media

    Miscellaneous links

    • Explore
    • Contact
    • Privacy Policy
    • Terms of Use
    • Support

    © 2022 Creatd, Inc. All Rights Reserved.