Self-service retail: the good, the bad and the ugly
The term ‘self-service’ has made retail headlines recently – but what does it actually mean? Why has it become so popular? What are the positives (and negatives) of providing self-service options for shoppers? In this blog we’ll cover the good, the bad and even the ugly of self-service, and provide insights into the tech tools that will enable you to deliver a true omnichannel experience for your customers.
What is self-service retail?
In a nutshell, self-service retail (sometimes referred to as ‘self-serve retail’) means providing alternative ways for your customers to check out – usually without the need for human interaction. Examples of self-service solutions are:
- Self-scan point-of-sale (POS) terminals
- Mobile POS
- Scan & Go
- Click & Collect
Self-service gained a lot of popularity during Covid-19, when the need to social distance was paramount. Nowadays, customers choose self-service for its convenience – in fact, a PYMNTS report found that 60% of shoppers preferred self-checkouts to interacting with a cashier in-store.
Self-service checkouts: The Good
When executed well and working harmoniously with solutions such as CCTV cameras, inventory management systems and loss prevention technologies, self-service can be a game changer for your retail store.
- Retailers in Europe that offer the latest self-service solutions are realizing fantastic results such as:
- A boost in customer satisfaction due to shorter wait times at tills and a more personalized user experience.
- Reduction in labor costs as well as increase in employee engagement as staff are liberated from manning traditional checkouts.
- Optimization of floor space, meaning you can display more products or merchandise, as well as reduce queues and congestion in-store.
- A competitive edge in a saturated marketplace – where customers become loyal brand advocates due to the seamless shopping experience.
Self-service checkouts: The Bad
Although self-service solutions are supposed to make processes smoother, there are many inferior solutions on the market that can actually damage your brand and jeopardize the customer experience.
After 40+ years in the retail industry working on hundreds of system replacements, we’ve seen it all. Retailers that select the wrong self-service partner often:
- Struggle to integrate their self-service solution with other IT systems which results in slow running times and disjointed customer journeys.
- Find it impossible to synchronize pricing and promotion across on and offline channels.
- Confuse customers with inconsistent brand experiences.
Self-service shrinkage: The Ugly
There’s an ugly topic on every retailer’s agenda this year – and that’s shrinkage. Many business leaders have honed in on self-service as a hotspot for shrink and theft, but studies have shown that customers value choice above all when it comes to shopping journeys – so, the question is, how can retailers provide self-serve options to customers without them being a shrinkage risk?
Self-service loss prevention (SSLP) is a software-as-a-service tool that utilizes Machine Learning to safeguard against theft, mis-scans and fraud. Retailers with an active SSLP strategy in place are experiencing:
- Up to 4x more theft being caught, with SSLP accurately identifying and combating shoplifting.
- Unnecessary checks and basket audits reduced by 50%.
- Seamless integration with existing POS infrastructure, no matter which hardware is in place.
- Staff can make data-driven decisions, both in-store and in the back office.
Weighing up self-service solutions
There’s one thing that’s clear when looking at self-service shopping in 2024: the good far outweighs the bad. The key is selecting cutting-edge software that integrates with your existing IT architecture and safeguards against shrink.
Hii Checkout is Extenda Retail’s cloud-native POS platform – a one-stop solution that breaks down the boundaries between physical and digital shopping. Working alongside our AI-driven SSLP solution, Hii Retail enables true unified commerce – meaning you can always deliver secure, elevated shopping experiences whilst combating theft and shrink at the same time.
