The major grocery chains Coles and Woolworths over the major apparent success of self-serve checkouts in supermarket and retail stores have flaunted it. From a marketing distribution perspective, it is a reliable self-sufficient service that benefits all parties involved. Having a self-serve checkout system saves time and cost, as well as convenience for customers whom are seeking to get in and get out In a hurry. According to (Orel & Kara 2014)some of the main motivations of the supermarkets for offering SCSs are cost cutting, speed, and convenience, supermarkets are also assuming that these services would enhance customer experience, satisfaction, and ultimately loyalty.
However, and article by Wynne (2015) argues that the Self-service system is damaging customer loyalty, and that using machinery to replace human contact is a hindrance on society. According to Wynne, ‘five out of six people would rather be served by a person than a machine, and when compared to the fact that forty to sixty percent of retail outlets are now self serve outlets’ does not bode well for the supermarket chains. It is interesting how depending on which concept of customer service you occupy, will gratify each distribution system differently. If one views good customer service as fast and efficient, then the self serve system is favorable, where as If one views personal human contact as good customer service, then traditional service outlets become favorable. Wynne (2015) also attributes the customer demographic as a cause to which system is preferred. It would seem that men who are purchasing a few items will favor the self service checkout system, where as women who are buying lots of items would rather not do the “supermarkets work for them” (Wynne, 2015).
A study conducted by (Li et al. 2013) highlights the managerial issues that arise In relation to inter-customer interactions when using self service checkout. It was demonstrated that a lack of inter-customer interactions created by the introduction of self service check outs had an effect on the customers perception of quality and repeat purchase intentions towards the retail store (Li et al. 2013). Furthermore, it was concluded that customer relations had to be successfully integrated as part of the self service experience to generate the same perception and return intention. This can be done via having an employee present at the check out service area, or alternatively making the self service more customer friendly (Li et al. 2013).
This issue has presented itself before in the banking industry. Banks decided to move from a personable customer service to automatic teller machines, to online banking, Wynne (2015) highlights that one issue presented in this was customer loyalty. Today the average adult runs 3.8 accounts across 3.1 bank institutions, there is no loyalty there.
Another large issue that is circling self-serve checkout is thievery. A British study found that $3 billion worth of items are stolen from supermarkets every year (Carter, 2014) with one shopper in five taking advantage of the opportunities for theft offered by do-it-yourself checkouts. Retail experts In Australia estimate that one to three percent of revenue is taken by thievery every year, but according to Coles the amount saved in employee costs every year far outweighs the amounts stolen (Carter, 2014)
As we are evolving to new technological heights, it would seem the value of industries is ever increasing in power and efficiency In distribution channels. However one must not forget the core values underlined and risk sacrificing customer perception and loyalty at the prospect of cheaper labor and faster sales.