It appears as if retailers, such as Walmart, are rethinking the self-checkout offering at stores and some retailers are either pulling them out or not launching them as theft related to a cashier-less experience continues to grow.
Melinda Deines, Strategist: Brand & Marketing with design consultancy SLD, said even a consumer who has little intention of stealing is more likely to do so at self-checkout. Consumers who are inclined to steal can now do so more easily.
“By continuing to use self-checkouts in their current format, retailers are creating an environment where theft will continue and become normalized, threatening even greater losses in the future,” she said.
“Walmart’s not the only brand that’s rethinking self-checkouts. Wegman’s in the U.S. is removing them. Hy-Vee which is a gas convenience, they’re pulling them out. Albertson’s has been back and forth. Trader Joes has said we’re never having them and still don’t have them. We’ll see if that remains true forever.
“There’s definitely a range of responses. I think the amount of shrink caused by self-checkout probably was a big surprise to a lot of retailers and dealing with that is probably sort of mission number one from their perspective – controlling that because it’s gotten out of control. The interventions that they’ve been using are not really working. So that’s why we’re seeing some of this backtracking and now having staff members coming and supporting with standing. This could help them while they rethink what does the ideal experience look like. In the meantime, we’ve got to control that shrink.”
She said self-checkout has created a new type of shoplifter.
In a blog on the company website, Deines outlined the four factors making self-checkout really conducive to shoplifting:
- Self-checkouts increase consumer frustration. Despite improvements in technology, self-checkouts are still far from simple. Most lack an effective workflow and there are no standard practices, creating confusion. A customer hasn’t been trained on how to find codes or enter promos correctly. Such frustrations may cause consumers to steal out of sheer exasperation.
- Stealing, simplified. At traditional checkouts, a staff member takes responsibility for accurately scanning items and obtaining payment. Without that oversight, brands rely on an honor system. When no one is watching, it’s a piece of cake to switch a lower-cost item for an expensive one, switch barcodes, and not scan all items.
- The risk of enforcement is low. If a consumer is caught with an unscanned item, they have the perfect explanation: it was an honest error. Proving otherwise may be impossible, making enforcement very difficult.
- Consumers rationalize their behavior. The removal of human interaction may amplify the sense that stealing from a big corporation doesn’t hurt anyone. In today’s inflationary economy, financial stress adds another reason to rationalize theft. In addition, consumers may feel that retailers are saving money by reducing labor costs so they are entitled to share those savings. Or, they may feel this is their way of forcing the retailer to “pay them” for doing a job that was previously done by staff.
Deines said some common deterrents used by retailers today involve friction which could create negative experiences for consumers and staff.
The first is staff monitoring, the second is the use of smart security, the third is shutting down self-checkouts at busy times, the fourth is implementing receipt checks or rescans as consumers exit, and the fifth is using messages that caution consumers about theft.
“The first thing to think about is that first of all customers want self-checkout,” she said. “They do. There are a lot of customers that don’t want to use them but want to have a person but there’s a lot of customers that do want them. Eliminating them altogether is not a long-term solution and I don’t think that’s the way that retailers should go.
“However, I think if you’re in a situation where the loss is so extreme that you’re considering raising prices, I would say a temporary shutdown and rethink quickly would be better than raising prices. Retailers need to think that yes people want this type of technology but it has to work for the consumer. It has to be easier for them. A lot of that frustration that consumers are having when things aren’t working, it’s not a seamless experience for them, they are trying to get support from a staff member and the staff member is not there or is with someone else, if we can deal with that then we can deal with a lot of the accidental loss because a lot of this loss is not coming from intent. It’s coming from someone just making an honest mistake.
“The amount of loss that’s happened due to accidents is very high. So if we can deal with some of that frustration and make it more seamless then we’re going to shrink the shrink by doing that. That would be the most important thing that retailers can do.”
She said the other most important thing they can do is think of technology as working in concert with human beings.
“Removing human beings completely from the equation is not what customers want. They want to have access to a person in case something doesn’t work,” she said.
“And the other aspect of having a human being there is that it reinforces the sense that this is an organization where it’s humanistic. If we completely remove people from the equation then we reinforce the sense that this is just a big corporation. It’s just the big, evil bad you know multi-national corporation that’s here to stick it to the little guy. So we don’t want to have that happen. We want to reinforce that positive relationship with our staff and empower them to really make a human connection with people even if it’s just greeting someone and saying hi my name is Melinda if you need any help I’m right over here, just click this little button and I’ll be right there. Even something like that can go a long way to making people feel like oh there’s a person here which really changes the dynamics at self-checkout.”