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Innovations in Retail: The Impact of In-Store Handheld Scanners

Innovations in Retail: The Impact of In-Store Handheld Scanners

Divya Ramachandran and Mehrnoosh Reshadi

In today’s world, where technology is increasingly ubiquitous, retailers are seeking innovations to aid and engage customers during their shopping journeys, while potentially increasing sales. In this regard, many stores in Europe and the United States have adopted handheld scanners in their stores; for example, Smith’s grocery chain, based in Utah, deployed these scanners in some stores in 2018. Handheld scanners are small remote devices that consumers can use to scan products, tally prices of products in their basket, and even skip checkout lines. Although handheld scanners are becoming prevalent, there is a lack of clarity regarding their impact on consumer sales. While industry experts predict the growth of handheld scanners, research has reported conflicting results. For instance, while handheld scanners promise to reduce checkout times, help consumers stay within their budgets, and introduce fun into shopping, there is also evidence to the contrary. Some retailers report an increase in sales with the adoption of handheld scanners, but some consumers report reduced expenditures while using handheld scanners. These contradictory results highlight an important question in the current retailing context: what is the impact of handheld scanners on retail sales? A recent study by Grewal, Noble, Ahlbom, and Nordfalt (2020) investigates this critical question by bringing together advanced analytical techniques in a series of field and laboratory studies.

In their research, the authors conduct three field studies using eye-tracking technology and two laboratory studies to examine the effect of consumer handheld scanners on sales (planned and unplanned purchases), as well as the underlying mechanisms. In doing so, the authors study cognitive factors (attention to products and prices, and perceptions of control) and affective factors (tactile exploration and shopping enjoyment) and consider potential differences between consumers who follow and do not follow financial budgets. Eye-tracking is an algorithm-based technology that uses sensors built into eyeglasses to detect presence, center of attention, and focus of the person who is wearing the glasses. Eye-tracking technology provides the opportunity to understand consumers’ behaviors in a more realistic way by capturing actual consumer behaviors and alleviating concerns regarding consumer self-reporting and its inherent inaccuracies. In this article, the authors use the number of eye fixations on price tags and products captured by the eye-tracking technology to measure consumers’ attention to shelves, and the number of times consumers touched a product as recorded by the eye-tracking videos, to measure touch. The authors match more than 200 hours of eye-tracking data from two field studies with sales data to reveal the influence of handheld scanners on shopping behaviors. They also conduct a field experiment (matched with sales data) to address concerns regarding self-selection bias and two laboratory studies to collect survey-based measures of the attitudinal process mechanisms and boundary conditions.

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Through these experiments, the authors demonstrate that handheld scanners can increase multiple sales measures such as total sales amount, number of items and categories sold, and total time spent. They suggest that when budget-conscious consumers use handheld scanners they pay attention to (fixation) and touch more items in the store. This increases consumers’ sense of control and shopping enjoyment, subsequently leading to increased sales. The authors also find that the use of handheld scanners increases unplanned purchases but decreases planned purchases, even encouraging healthier and more impulsive purchases. However, there are differences in the behaviors of consumers who shop with a set budget as compared to those who shop without a budget. For consumers with a budget, having a handheld scanner leads to unplanned and impulsive purchases, resulting in increased store sales. However, for consumers without a budget, the use of scanners can decrease sales. Furthermore, this article also addresses retailers’ concerns about consumers using handheld scanners to aggressively pursue deals and promotions by scanning for reduced prices and discounted items and avoid purchasing regular-priced items. Results demonstrate that the use of handheld scanners does not change the average price paid per item or the relative number of deals, indicating that handheld scanners do not encourage bargain hunting tendencies among consumers.

Handheld scanners can increase multiple sales measures such as total sales amount, number of items and categories sold, and total time spent. … When budget-conscious consumers use handheld scanners they pay attention to and touch more items in the store.

We reached out to the authors to understand the underlying motivation of this article and the role of prior research and methodological expertise in combining various methodologies such as eye-tracking, field experiments, surveys, and sales data. We learned that all the authors were interested in research on in-store technologies and two of the authors (based in Sweden) already had experienced the use of handheld scanners in grocery stores for several years. In light of this, they were curious to understand whether handheld scanners can enhance or decrease sales. The lack of a clear answer in popular press and academic articles led the authors to explore this question in this study. The authors’ previous experience with a retail chain in conducting field experiments, as well as their partnership with a retail consulting company that collected the eye-tracking data led them to combine various methodologies to study the impact of handheld scanners in the field.

Although the consumers participating in this study use handheld scanners while shopping in-store, we wondered if there could be challenges with regard to consumers using the handheld scanners in a non-experimental setting. For instance, could there be potential challenges to consumers’ use of handheld scanners such as unfamiliarity or uneasiness with technology, perceived inconvenience, demographics such as age, etc. or even privacy and data concerns? Could there be potential cost-related challenges on the retailers’ end? Is it possible that consumers participating in eye-tracking studies alter their purchasing behavior due to the perception of being watched? The authors clarified the multiple benefits and challenges associated with in-store handheld scanners. Handheld scanners offer retailers and consumers opportunities such as price checking, tallying purchases, finding promotions, and saving time by avoiding the traditional checkout process. Especially in the current COVID-19 environment, the authors believe that handheld scanners and other contactless checkout systems (e.g., mobile apps with barcode scanning functionalities) are more important than ever before, since “any technology that allows consumers to checkout more efficiently without touching as much in the store would be considered beneficial.” Traditional grocery stores can use handheld scanners to do away with traditional checkout processes and offer contactless checkout.

However, the authors noted that some demographics such as those less comfortable with technology or older consumers might be averse to opting into using this technology. Overall, although consumers are concerned about data privacy, they are increasingly comfortable with the cost-benefit calculus of sharing data. Importantly, from a methodological perspective, the authors recognize that consumers may change their behavior and purchase decisions when they perceive that they are being watched via eye-tracking technology and alleviate this concern by replicating the in-store results in an online context.

While the article showed that the use of handheld scanners can enhance shopping enjoyment, it did not explore the impact on overall customer experience and customer engagement throughout the shopping process. The authors noted that although their results did not seem to show any influence of handheld scanners on overall store satisfaction, there is scope for future research into the effect of handheld scanners on customer engagement with specific aspects of the store, such as differences in consumers’ engagement with merchandise.

The authors conducted their field experiments in a grocery store context in developed markets among individual customers making purchasing decisions for themselves and their household – highlighting possible limitations and potential areas for future research. According to the authors, the effects outlined in this study might be pronounced or attenuated in other store formats and markets, due to various factors including technology adoption rates, type of merchandise in the store (hedonic/utilitarian), crowdedness of the store, frequency at which consumers shop at the store, whether consumers shop alone or with others. As a particular example, the authors suggest that the experience of using handheld scanners could be more pronounced in frequently visited stores (e.g., grocery or pharmacies), but could be different in less frequently visited stores (e.g., department stores).

This article brings together various technologies and analytical techniques and emphasizes the importance of advanced analytics in retailing research. According to the authors, analytical methods in future retailing research will involve more detailed abilities to analyze data from different sources in order to offer consumers valuable coupons, offers, and solutions that are relevant to them on that particular shopping trip. For instance, if a shopper was using a mobile device or an app to shop future analytical methods can integrate the specific shopper’s in-store journey, their current purchases, and past purchase history (based on a loyalty card); compare it to other shoppers’ purchase histories with similar profiles; and include insights from the shopper’s  current environment. This would allow retailers to provide enhanced solutions tailored to consumers—for instance, suggest items that are usually purchased and recommend additional items to be purchased for a specified meal recipe, based on current items in the shopping cart. This article and the authors’ insights underscore the future role of advanced technologies and analytics in retailing research.

Read the full article:

Dhruv Grewal, , Stephanie M. Noble, Carl-Philip Ahlbom, and Jens Nordfalt (2020), “The Sales Impact of Using Handheld Scanners: Evidence from the Field,” Journal of Marketing Research, 57 (3), 527–47.

Divya Ramachandran, Chair-Elect of the American Marketing Association Doctoral Special Interest Group (DocSIG), is a marketing doctoral candidate at Georgia State University, USA

Mehrnoosh Reshadi is a doctoral student at Texas Tech University