Self-checkout System Spending Soars to $475 Billion In 2006, On Track To Hit $1.2 Trillion In 2009

Written by Evan Schuman
June 27th, 2006

Language difficulties one of several factors behind a 47 percent increase from last year.

American consumers?especially frequent fliers?are becoming quite comfortable with self-checkout systems, to the tune of a projected $475 billion in self-checkout purchases this year, according to a new study from the IHL Consulting Group.

That’s a 47 percent increase compared with what IHL recorded last year and IHL is predicting the sharp increases will continue, with a projected $1.2 trillion in self-checkout sales projected by 2009.

What makes the $1.2 trillion projected sales even more impressive, according to IHL President Greg Buzek, is that IHL’s survey excludes gasoline sales.

Pay-at-the-pump would have otherwise dramatically increased the reported numbers, especially given the skyrocketing gasoline prices. Those soaring numbers would have skewed the results, which would have then showed self-checkout purchase dollars increases which would have been entirely a result of increasing prices.

As it happened, Buzek said, IHL’s survey has never included pay-at-the-pump self-checkout figures because industry officials felt those numbers were well-documented and not needed.

But even without gasoline being included, a related factor did impact the numbers. Self-checkout has gotten to be very popular at non-grocery-chains?including Home Depot, Lowe’s, Wal-Mart and BJ’s Wholesale Club.

Those chains tend to have much higher dollar purchases and that helped pushed the average transaction size from $25 in 2004 to $35 this year, Buzek said.

IHL examined the increasing use of four types of self-service kiosks where payment is accepted: self-checkout systems, ticketing kiosks, check-in kiosks, food ordering, and postal kiosks.

“Kiosks are fundamentally changing the way consumers do business,” Buzek said. “Among retailers, we are seeing anywhere from 15 percent to 40 percent of all purchases are made at self-checkout machines. Usage is even more impressive at airports, where some airlines estimate that near 80 percent of passengers are avoiding the traditional check-in process and instead using self-check-in machines.”

The IHL study pointed to several factors influencing the increases, but perhaps the least expected factor is an increase in the number of customers who speak little or no English.

“In areas that are predominantly multi-lingual, the kiosk is the thing that can help get the order right,” Buzek said, referencing French-speakers in some Canadian provinces and Spanish customers in many urban areas, especially those near the Mexican border.

Post-office kiosks proved “extremely popular” and one reason there is that it provides an alternative to long lines with civil service employees on the receiving end, Buzek said.

But the overwhelming factor in the increase is simply that customers are getting more comfortable with the technology and are therefore much more willing to use it. That comfort is especially true among frequent-fliers who have gotten used to the technology because of airport self-checkout ticket kiosks.

IHL specifically found that non-intuitive gender differences. “Women are 250 percent more likely to use (retail) self-checkout kiosks if they have already used one at the airport,” Buzek said. “Men are only about 150 percent more likely.” He said that was likely because men were generally more inclined to experiment with self-checkout.

“Consumers have become much more savvy. Their time has also become more valuable and limited, and self-service is one way they can speed along their buying experience,” Buzek said. “Retailers and other businesses are finding that self-service kiosks can significantly increase customer loyalty, as well as customer satisfaction.”


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