Dec 10, 2005

A preferred checkout experience, part 2

I encountered these 3 things over a two day period, which all triggered cross-fertilization ideas for a preferred checkout experience.

- The picture on the right shows an Esso petrol station in Reykjavik, Iceland which lets you choose either a self-service lane where you do everything yourself (the two red lanes on the right), or the slightly more expensive full-service lane (the blue lane on the left) where employees pump the petrol for you, wash your windows and maybe check the oil if you ask them to.

- A pop-up ad from a ski resort in Colorado offers a special VIP pass that gives skiers access to shorter ski-lift queues, for a $20 surcharge on the normal lift ticket price.

- A rental car agency invites customers to join an elite club with special privileges, like getting to your car faster without waiting in line or filling out forms. These privileges used to be reserved for best customers, but rental car agencies began charging an annual fee for the service years ago, so any customer could benefit.

I keep coming back to the supermarket checkout experience, maybe the most unpleasant part of grocery shopping. A great deal of innovation over the past 20 years in the checkout and payment area has focussed on speed, making the process as fast as possible so customers get over the bad moment quickly. This has already produced substantial improvements. Much of the ongoing work in this direction will continue to yield improvements, but probably in smaller, incremental steps. Sometimes it feels like the unspoken objective is to make the checkout process so fast that it approaches the point where it simply no longer exists, making the whole unpleasant experience go away. Contactless cards, for example, try to make the payment function disappear by letting customers pay without even having to choose a card, simply tapping a wallet or purse against a reader will do.

Since nobody has found a way yet to make the checkout process disappear completely, innovation has also happened in parallel in another direction: making the checkout experience less unpleasant, and more attractive and stimulating. This has produced things like checkout TV’s playing ads and round the clock news. Or self-checkout units that keep customers busy by letting them scan their groceries, put them in bags and swipe their own credit card.

If customers are willing to pay for premium service at ski resorts in Colorado, petrol stations in Reykjavik and rental car agencies around the world, why wouldn’t they pay for similar services in grocery stores? What type of premium checkout experience would customers be willing to pay for? Premium checkout lanes could feel more like an airline lounge for business and first class passengers than typical grocery checkout lanes. The service would offer shorter queues, additional help with groceries, a coffee or cold drink, and a more quiet and relaxing environment. Plus, the additional fee added to the bill at each visit could be waived for cardholders that spent over $500 in the last calendar month.

Going back to the Esso petrol station in Reykjavik, it would be easy to imagine Esso telling customers that if they fill up twice in a fifteen day period, they get to use the full service lanes for the same price as self service. The lanes are already set up for full service and self service, banks are already migrating to EMV cards that can store the fact that a customer has filled up at Esso twice in the last fifteen days, and, at the same time, terminals are already being upgraded for EMV, with the ability to automatically adjust the price based on prior purchase information in the EMV chip. So offering this type of benefit to VIP customers is becoming relatively straightforward.

Related posts:
A preferred checkout experience
Try this: increase profits by pampering best customers ... and firing undesirable customers
Study: Best customers expect VIP treatment

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