SCO in Non Grocery – How’s it going?

Rise of Self-Checkout Beyond Groceries

In the ever-evolving landscape of retail, self-checkout systems (SCOs) have now moved beyond their grocery roots, marking a new era in non-grocery sectors. In our annual review of these developments, the working group focused on uncovering trends, challenges, and innovative strategies shaping the future of SCOs in non-grocery retail.

Adapting SCOs to Diverse Retail Environments

The adaptation of self-checkout systems in non-grocery settings presents unique challenges. Retailers experimenting with SCO have encountered various hurdles, particularly when removing hard security tags, which sometimes can also lead to increased losses. These new challenges underscores the need for a tailored approach in different retail contexts.

Learning from Grocery Retail’s SCO Experience

The non-grocery sector can glean valuable lessons from grocery stores, pioneers in SCO implementation. These insights range from managing customer flow to sophisticated loss prevention techniques. However, a significant challenge remains in addressing the savvy customers adept at manipulating these systems.

Data-Driven Strategies and Customer Engagement

A striking difference in the non-grocery sector is the proactive use of SCO data to identify patterns and guide interventions. This approach, less prevalent in grocery retail, paves the way for more sophisticated and responsive SCO systems.

Enhancing Customer Engagement with Loyalty Integration

The integration of loyalty programs with SCOs offers a dual benefit: enhanced personalisation and reduced anonymity. This strategy not only provides valuable customer insights but also potentially deters dishonest behaviour, making it a promising direction for future implementations.

You can watch the full discussion between Colin Peacock and Prof Adrian Beck or read a transcript of that discussion below.

SCO Full transcript summary (edited for clarity)

Colin Peacock: Anyway, last week, we had a really good meeting around self checkouts in non-grocery. Because we normally talk about grocery, don’t we? We’ve been doing this for about three years or four years or so.

We’ve got a bit of a cadence, we’ve got case studies now that we update every year.

Just over 60 people turned up and many more will watch the recording, no doubt.

It was a really good session, really good feedback, and feels like everyone got something out of it in terms of a sort of nugget of information.

But what were your takeaways and what do you think the learning should be for the industry on this one?

Beck, Adrian (Prof.): We really got sort of a kaleidoscope of experiences. Lots of different ways in which non-grocery were trying out self checkout. In different formats?

On one extreme we had, you know, a retailer that had tried it, didn’t like it, felt it didn’t give a good customer experience, really ran into the challenge of dealing with the hard tagging problem.

The compromise with that they found was: If we’re going to use self-checkout, we’ve got to take all the hard tags off. And that didn’t go well in their trial stores.

I think they reported well over 60% increase in their losses once they took their hard tags off, which really undermined their business case for bringing in SCO into that environment so you know they concluded you know for now it’s not for us.

So that was one experience, but we had others and there’s two that I particularly like because they really sort of highlighted the different approaches you can take to introducing it into a non grocery environment.

One of them was: Let’s just turn around some previously staffed tills and see what happens. Without any sense of planning or structure or thinking through the consequences.

And the other one was a much more planned intervention in terms of thinking through what technology they want to use, how they want to design the space, how they’re going to control the losses before they bring it in.

So it’s a really interesting contrast in two different approaches and perhaps not surprisingly, the former approach didn’t go well. They had very high levels of loss and they’re now having to play catch up to try and think through the design of their SCO and how they’re going to control it.

Whereas in the second one they really had a handle on what was happening in their environment. They recognised that loss was going to be an issue, but they’re really trying to think it through.

So they were very interesting and contrasting case studies in how SCO can go in a non grocery environment.

But there are two other things I think worth mentioning.

I think one is that clearly all these companies have the opportunity that they can now see what’s happened in grocery.

Grocery has been there and got the T shirt and and is now really showing how they have to control those spaces, how they can think about loss in those environments.

But also of course, they’re inheriting customers who not only have now been exposed to SCO. So it’s not such a shock to those who are going into the world of apparel and having to use the SCO machine to check out.

But the downside, of course, is that these are also customers who’ve also worked out how they can use and abuse these systems.

So it can work both ways in terms of that customer training piece.

And so the main takeaways are I took away from this was there were certainly some differences in terms of what some of these companies in non grocery were doing that perhaps we haven’t seen as much of or been aware of within grocery.

And certainly they were using things like not being afraid to do random checks that fixed self checkout which we’ve seen in some grocery stores but not very many.

It’s quite an intervention to bring in the idea of random checks/

Secondly, the use of exit controls which again again some grocery stores are doing, more on mainland Europe perhaps than in the UK and in the US, but they are trying out this idea of getting the person to somehow have a form of control as they leave, using their receipt or using video technologies.

And then another I liked was that one of them really focused in on the importance of staff training and how they spent quite a bit of time really trying to get their staff prepared for not only helping customers through, but also training them in terms of what to look out for in terms of keeping customers accurate and honest in those environments. So that was really refreshing to hear as well.

Colin Peacock: Yeah, I thought the other piece that I saw was around data. A few of them were starting to look at the self-checkout data and look for patterns and exceptions to start to identify some of the things that might be going wrong with a view making some sort of real-time intervention.

And I don’t see the grocers doing as much as of that as I saw with these non-grocers.

So perhaps getting in the beginning and start thinking about how you can use the data to guide your interventions to guide your thinking I think was really good.

We also saw an example of one retailer where they’re asking the customers to put in their loyalty card at the start of the transaction, which I thought was also very interesting. It increases personalisation and reduces anonymity.

Beck, Adrian (Prof.): Yeah, that was nice to see. And it’s certainly an interesting idea because if we want to learn some things from scan and go, for instance, which is that scan and go is really premised upon the idea that your customer has to register before they can start using scan again.

OK, there are ways around that, but there’s a sense of reducing anonymity, which we know can reduce the likelihood of people offending, getting people to put in their loyalty card before they start the transaction potentially gives you data about their history of scanning the history of that shopper.

And also whether you can give them better customer service. If you know that nine times out of 10, this customer always buys alcohol. Then you can let a member of staff know that there’s probably, you know, there’s going to be an alert at that till they they so can be more proactive and give a better customer service.

So having that loyalty card data and getting it in before the transaction begins offers a number of great opportunities around self-checkout.

Colin Peacock: Well, to your point as well, it also speeds up the transaction. So you know that’s a good thing.

So look, we’ve got loads of self-checkout meetings coming up for the self-checkout fans, not least on January the 30th where we’ll be launching and sharing with you 5 design ideas from our competition we ran with the University of Arts.

Five new ways of reimagining the self-checkout experience with reducing loss in mind.

So that’s on January the 30th. But thank you so much, Adrian, very helpful notes and a great session and we’ll do it all again next year on this non-grocery SCO.

Beck, Adrian (Prof.): Thanks Colin, bye bye.