Are stores missing impulse sales opportunities at the self-checkout?
Through a special arrangement, presented here for discussion is a summary of a current article from the monthly e-zine, CPGmatters.
Several years after soft drink giants managed to get small coolers installed right next to checkout lanes at most American supermarkets and many other types of stores, Coca-Cola is trying to get many of these outlets to take the next logical step: merchandising impulse-buy beverages in the increasingly popular self-checkout area.
Beverages, confections and magazines are the three "power categories" that represent 79 percent of sales at the front-end of supermarkets, according to a Dechert-Hampe study from several years ago called "Front-End Focus," which was sponsored by Time Warner Retail Sales & Marketing, Mars Chocolate North America and Coca-Cola.
"Front-end impulse-category solutions are more important today compared to years ago when self-checkout was launched because both the shopper and traditional checkout have evolved," Ron Hughes, Coca-Cola’s director of shopper experience innovation, told CPGmatters. "Now self-checkout has become more pervasive."
And yet, he noted, "As more self-checkout systems came on board, retailers did not really consider systems to merchandise key impulse categories. Merchandising became an afterthought," as noted in the Front-End Focus study which stipulated that 50 percent of self-checkouts were not merchandised.
Source: Coke Solutions
Coca-Cola’s small coolers allowed shoppers to cap off their in-store experience with cold-liquid refreshment. Now, Mr. Hughes said, Coke is attempting to enhance this experience by folding in the self-checkout area and by incorporating new and emerging technology, sensory experiences and compelling call-to-action messaging into its solutions.
Specifically, for example, Coke and other power category CPGs are helping retailers understand how to manage the front end as one department, allocate merchandising space-to-sales ratios, make sure that solutions connect with shoppers’ motivations, and inspire shoppers to buy impulsively. They are also "helping retailers understand the importance of merchandising 100 percent of self-checkouts," Mr. Hughes said.
He explained that the front end is difficult for some retailers to manage in part because of "the coming together of numerous and varying categories in a relatively small area of the store," and the lack of "a strategic exercise designed to maximize overall front-end performance based on the goals of the organization."
Coca-Cola recommends to retailers that they have a single front-end department manager. Alternative methods of checkout such as paying by phone and "smart shelves" are also causing Coca-Cola to explore "understanding the impact of new technology on buying behavior and how smartphones are influencing shopping along the path to purchase," Mr. Hughes said.
Why aren’t front-end impulse items more prevalently displayed at self-check lanes? Do newer technologies present opportunities for impulse purchases around self-checkout?