AS PART of its “back to basics” strategy, Morrisons – the UK’s fourth largest supermarket – has announced the return of staffed express checkouts. As the first major retailer to make the U-turn, what now is the future strategy for self-service?
Is Morrisons responding to a change in customer shopping behaviour or did they, along with the rest of the retail market, get their strategy wrong in the first place?
The figures show that only one in three supermarket customers had used self-service; what makes this figure even bleaker is that queues at staffed checkouts have actually lengthened where self-service has been introduced.
For supermarkets, self-service checkouts have played a contributory factor in the loss of customers to smaller rivals who are seen to offer a better experience with personalised service at a lower cost.
Lowering staff head count to reduce operating costs is the headline benefit for most organisations who have introduced self-service checkouts. Unfortunately when cost reduction is at the heart of your customer service strategy, the outcome is fairly predictable. Customer behaviour shouldn’t have been unexpected – the impact on satisfaction levels when you introduce cost saving measures are, with the odd exception, going to be negative.
It is unlikely, though, that self-service will be removed from any retailer. And nor should it be. As someone who has implemented self-service into the retail sector, I believe that it has an even greater role to play in future strategy.
Yet those organisations who implement it correctly will be the ones whose focus in on improving the customer experience through the use of technology. A by-product of this will be the cost saving through head count reduction.
One of the best examples of self-service is travel ticketing used on the London public transport network. In order to migrate customers to self-service they introduced the Oyster travel card. Within 10 years of its introduction in 2003, Oyster was used in over 80 per cent of all journeys. So successful is it that self-service ticketing will allow London Underground to close all of its ticket offices by the end of 2015 – down from over 250 when Oyster was first introduced. Supermarkets can only dream of such figures.
The reason why self-service for London public transport has been so successful is that they used the introduction of Oyster to make self-service ticketing more convenient for their customers. The strategy for implementation was built upon a simplified pricing policy, highly reliable infrastructure and incremental migration of more complex products as customer advocacy grew.
For retailers, this lesson of simplifying the underlying customer experience, making self-service the convenient choice, ensuring the platform is reliable and only growing as reliability is proven and adoption grows, is one they can still use.
Simple measures that can overcome the failings of current technology or operating constraints need to be considered. The complexity of the transaction needs to be reduced. If you need to train your staff to do a task, don’t expect your customers to be able to do the same task without training.
For customers, the use of self-service check-outs needs to be a preference – a choice that they make rather than something that is enforced on them by the retailer. This preference may be subject to the context – a basket of shopping can drive significantly different behaviour than an over-flowing trolley of goods. Putting the customer at the heart of the retailer’s self-service strategy will enable context to be considered, behaviours to be modelled and solutions to be designed to meet customer needs.
In an increasingly digitally enabled world, self-service will also be omni-channel; a richer experience in store and online that delivers convenience and benefit to customers that encourages the adoption of self-service and a migration away from staffed checkouts.
So, while Bradford-based Morrisons does appear to have made a U-turn under its new leadership team, in reality they should just be revisiting their customer service strategy to make sure that when it comes to self-service, customer behaviour is not an unexpected item.
Bryn Robinson-Morgan is an independent business consultant.