Retailers Reconsider Empowering Customers With Self-Service

Major Grocer Getting Rid of Self-Checkout Lanes (MSNBC)

Self Service CheckoutGiving customers what they want is the mantra of nearly all marketers, and for the last 50-plus years has been arguably the most fundamental concept in marketing.  Marketers have been schooled to believe that success rests on giving customers what they “think” they want.  Many marketers have translated this to mean customers want to be empowered in deciding what products and services are best for them.  That is, they believe most customers want to know they are in control when dealing with the marketer.

Customer empowerment can be seen across all consumer and business markets, and in many forms.  But the most prominent form of empowerment is the move to offering self-service purchasing where previously the option was not available.  Some examples include the growth of such customer purchase options as home improvement retail stores, at home movie purchases, and online vacation booking.  For businesses, empowerment is evident with in-house publication design, online advertising and management of product shipment.

There are several arguments to support the idea of empowering customers.  First, as noted, marketers believe this is what customers want, and marketers are trained to offer products and services that satisfy customers’ needs.  Second, letting customers do the work reduces marketers’ costs.  Essentially, this happens because labor-intensive work is shifted away from the company and to the customer.  Third, with technology tied to many empowering situations, the ability to track and gather customer research far exceeds what can be obtained when the marketer performs the work.  For instance, by monitoring what customers do when performing their own work marketers may learn about new needs that customers have, which can then be translated into new products and product features.

But empowering customers may have a downside as some companies are finding.  As discussed in this story, by enabling customers to do work marketers often lose personal contact.  Whether it is placing orders online instead of through a customer service phone call or, as discussed in this story, allowing customers to handle their own checkout of groceries, marketers may be distancing themselves from customers.  The implications of loss of personal contact include the inability to up-sell customers on more expensive products, less opportunity to get inside the customer’s head to see what they really want, and, possibly the biggest concern, the reduction of customer loyalty as customers feel less connection to a particular company.

The move marks a surprising step back from a trend that began about a decade ago, when supermarkets began installing self-checkout lanes, touting them as a solution to long lines. Now some grocery chains are questioning whether they are really good for business.

Is the removal of self-checkout lanes a trend that is likely to spread to other retailers?

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