Article

Are checkout impulse buys a mobile casualty?

Sales of items typically stocked near grocery checkout counters have fallen sharply over the last year and a half.

May 6, 2013

The following is an excerpt from a recent conversation on RetailWire, reproduced here with kind permission.

According to a recent Bloomberg article, sales of magazines, gum and other items typically stocked near grocery checkout counters have fallen sharply over the last year and a half. The possible culprit: smartphones occupying shoppers' attention during wait times.

The problem of "mobile blinders is a huge factor," Marshal Cohen, an analyst at NPD Group, told Bloomberg. "Companies have to rethink the in-store experience."

The article stated that stores are already seeking alternatives to impulse buying at the checkout counter. For instance, Coke is adding single-serve drink coolers away from the front of the store. Hearst, the parent of Cosmopolitan, Good Housekeeping and Elle, is planning 20 in-store campaigns this year with Coke and L'Oreal SA, up from four in 2012.

But with much of the evidence anecdotal, some aren't sure of mobile's impact on impulse checkout purchases. Higher taxes, commodity prices and gasoline costs could be responsible for the recent downward trend in single-copy magazine sales, according to Mark Peterson, vice president of newsstand sales at Meredith Corp., publisher of Better Homes and Gardens and Family Circle.

Moreover, many believe e-coupons sent to mobile phones in aisles and other digital approaches will only expand impulse opportunities at checkout and across the store.

"By using location and behavior-based cues, savvy brands can reach consumers when and where it matters most," wrote Bonin Bough, VP of global media and consumer engagement at Mondelez International, in a recent article on Harvard Business Review's blog. "This could take the form of a mobile-based deal on gum mapped to a consumer's daily commute (a time when people are most likely to be chewing gum), or delivering a coupon for chocolate to a consumer's phone while they're in a long checkout line, engrossed in their phone instead of looking up at product displays."

RetailWire BrainTrust comments:

I'm skeptical about whether the use of smartphones has really killed demand for gum and candy in the past year, but I have a few other theories for the decline in register endcap sales:

1. How many registers are open on a consistent basis in discounters or grocery stores? Any staffing cutbacks (such as the well-publicized ones at Walmart) are going to translate into fewer open lines, and self-checkout is only speeding that process in drug and food stores.

2. Print media are in rapid decline because of the rise of online versions of magazines and newspapers. Why pay for a copy of People when you can read it online? It's no coincidence that Time Warner is working to spin off its print division.

3. Finally, most stores depending on checkout endcaps to drive impulse sales do it in an unimaginative way. This prime real estate has been occupied by the same types of merchandise (see point #2) for as long as I can remember. — Dick Seesel, Principal, Retailing In Focus LLC

Checkout has never been fun in any shopping environment. This is particularly true in food retailing, which for the most part does not use systematic checkout queues. Customers waiting in line are forced to deal with the boredom factor and respond accordingly; text, surf, etc.

Some of the noted technology options will bring impulse back to top of mind. However, the larger issue of store checkout remains. If one solves the store checkout issue, it will go a long way to solving the boredom and the need for multi-tasking. — Richard J. George, Ph.D., Professor of Food Marketing, Haub School of Business, Saint Joseph's University

Smartphone as scapegoat, that's a new one. Could it also be that people don't want to buy what's "merchandised" there anymore? Seems like it's time for some new thinking at checkout vs. new scapegoats.

Check out Hy-Vee, the innovative grocer from Iowa (!) that successfully tested 'healthier' options at their checkouts and is now rolling those out to all stores. That's in Iowa, center of the belle curve, where we all can live. — Lee Peterson, EVP Creative Services, WD Partners

While correlation is not causality, it does seem like the checkout lanes would be an ideal place to go into the "digital zone" for many shoppers. However, it is also the place where many shoppers reflect on the shopping trip to make sure they didn't forget anything. Having the items there that might have been forgotten still makes sense. And having a "digital option" for coupons on certain items also could have appeal. — Brian Numainville, Principal, The Retail Feedback Group

(Photo by slgckgc.)