November 21, 2022
Despite the frequent complaints from consumers and media reports about self-checkout lanes, grocers are continuing to push forward with the technology as labor challenges persist and consumer shopping habits evolve. Catalina, a company that transforms data into consumer insights, notes that more retailers are pivoting from manual to self-checkout lanes, reports Retail Dive.
Self-checkout lanes are becoming more popular, due to social distancing measures sparked by the pandemic and the availability of automation technology, the firm said. A few retailers, such as Walmart, Kroger and Dollar General, have even started testing self-checkout-only stores, per CNN reporting cited by the firm.
Offering a mix of both manual and self-checkout lanes can appeal to a wider variety of shoppers and serve different types of shopping trips, Catalina says, based on a new study. The findings are based on an analysis of 4.5 billion transactions made by 245 million consumers in the United States in 2021.
In fact, consumers who use both self-checkout stations and staffed checkout lanes consistently have the highest retention rates and best customer value, bolstering the case for retailers to take a hybrid approach to their front ends, according to Catalina.
Catalina found that the group of shoppers who used both methods includes a mix of demographics, with consumers tending to have a higher annual household income compared to shoppers who used one checkout type exclusively.
In 2021, 39% of shoppers identified as using both checkout types depending on what they were buying, with usage evenly divided between self-checkout and manned lanes. People who used a mix of both methods had the highest customer value ($1,720) and completed the most shopping trips (36) per year in 2021, compared to people who used only one of the methods.
“In our view, retailers should evolve to create a balance of self-checkout and manned lanes to accommodate more multi-dimensional shopper profiles, improve customer experience, enable cost efficiencies and maximize sales for the long term,” Wesley Bean, U.S. chief retail officer for Catalina, said in a statement.
The firm also found through a pilot with an unidentified regional grocer that self-checkout users who received coupons drove four times more sales growth than the self-checkout lanes with suppressed incentives.
Of the 12% of surveyed shoppers who said they only use self-checkout, Catalina found they tended to fill smaller baskets, which the firm said suggests they are likely buying household and pantry items in other channels, like at mass retailers or online. Catalina also pointed out that some retailers cap the number of items shoppers can buy using self-checkout.
Self-checkout-only tends to draw 19- to 24-year-olds and also people born between 1928 and 1945, known as the Silent Generation, the firm said.
Meanwhile, 49% of consumers still prefer only using manned lanes. That group mainly consists of Baby Boomers and Silent Generation consumers with household incomes under $100,000 and a high school education, Catalina’s research found.
“Until recently, shopper profiles generally grouped consumers by demographics and where they are on the purchase funnel,” Bean said. “Now, retailers can layer in check-out preferences and shopper affinities to create a more personalized shopping experience and reach individual shoppers with messages that matter.”
While manual checkout remains popular, the study’s findings underscore that grocers can reach more consumers and meet more shopping needs by mixing in self-checkout. Grocers who only offer one method over another may discourage certain customer demographics or purchasing behaviors, such as consumers using self-checkout for quick trips or Baby Boomers preferring traditional lanes.
Research contact: @RetailDive