Wednesday, October 3, 2012

Walmart Tests Scan and Go System

Daily Finance recently published an article detailing Walmart’s test run of a “new Scan and Go System” in one of their stores in Bentonville, Arkansas. The way it works is that customers download the “Scan & Go” application on a smartphone. Once at Walmart, they scan each product they want to buy as they move throughout the store. When the customers are ready to check out, they simply have to pay at a designated station.
Walmart is testing out this service in an attempt to focus on customer intimacy. By allowing shoppers to by-pass long lines, Walmart can improve the customer’s overall shopping experience. After observing complaints from Twitter users about long lines at their stores, the app seeks to speed up the check-out process.
I believe that the “Scan and Go System” can be beneficial for the company. It will allow Walmart to learn more about its customers’ shopping habits. Walmart can know what the customer will buy before even paying for it or leaving the store, making it easier to read customer behavior. The app can also increase sales by offering instant coupons for products that are related to the ones the customer already scanned. For example, if someone scans ice cream cones, Walmart can offer a “Breyers coupon.” Another added benefit is that Walmart can cut operation costs. They can reduce or even eliminate cashiers. But eliminating cashiers brings about negative effects of the application.
Although there are many benefits that arise from the “Scan and Go System,” there are also adverse outcomes. One downfall is the inevitable loss of jobs. By eliminating the need for check-out counters, many people will lose their job. Another negative aspect is the possibility of an increase in theft. Customers scan and bag their items as they shop around the store, making it easier to avoid paying for the products by simply hiding them.
Walmart has not yet implemented the “Scan and Go System,” but Apple has introduced a similar approach. They created an app called “EasyPay” that allows Apple customers to make purchases straight from their smartphone without an employee. It sends the receipt directly to the person’s phone. The video below shows the ease and speed of using the application. It took the user only sixty seconds to buy an item.

Overall, I believe that the “Scan and Go System” speeds up the check-out process and provides Walmart with added benefits, but it is still missing key elements. Since the app does not allow customers to pay directly from their smartphone, it is too similar to the self-checkout lane. They still have to go to a kiosk, which is an added step. Also, not all people have smartphones, so investing in this technology will not benefit all customers. Eliminating cashiers eliminates one on one customer service, which personally makes my shopping experience positive. Mobile check-out seems to be the future of retail stores, but it will bring about a major adjustment for all customers.



  1. I really like how you present detailed support for both aspects of Walmart’s “Scan and Go System.” The electronic checkout system may be beneficial to the company because it will provide them with faster and more detailed information on each customer and their preferences, and it could potentially eliminate the need for people to wait in long lines for checkout. However, I cannot help but think about the immense loss in jobs that this technology will create. Like you said, many, if not all cashiers will lose their job, and in this economy this is one thing we definitely do not need. In one article I read, I found that “for ever one second in average transaction time at the Walmart US chain, the company has said that it spends about $12 million in cashier wages” (Chicago Tribune). Sure, this might save a lot of money for the company, but this is one of those instances where the rich will only get richer (meaning the CEO’s of Walmart) and the poor will only get poorer (the cashiers). I also agree with you in that without cashiers, the one-on-one customer service is eliminated and instead customers will have to shop entirely for themselves. Finally, I, too, thought of theft becoming an issue once this technology is implemented. Without complete surveillance of customers, it would be very easy for people to just slip items into their bags and not scan them.

    Although the “Scan and Go System” may benefit customer satisfaction and advertising for Walmart, I feel as though the cons outweigh the pros. A lot of money would have to be spent by Walmart to just get rid of the current checkout stations and replace them with the scanning kiosks. Also, workers would have to be trained to help customers with this new technology, as it does not come easy for everyone. That makes me wonder how the older generation will accept this technology; especially those people who have trouble working any technology to begin with. Then there are malfunction issues to consider; what if the application crashes? What if there are glitches in the program? It would have to take a lot for Walmart customers to become fully satisfied and adapted with this new “Scan and Go System.” I hope that Walmart will be able to work out these issues because this scanning technology could change the way people shop forever.

  2. Christina and Anna, I really like all the pros and cons you guys touched on with regard to Walmart’s “Scan and Go System”. I had not even thought about some of the glitches related to the Smartphone app and what might happen if your phone dies halfway through shopping. I also agree that at this moment the negatives outweigh the benefits of this technology and that, if Walmart uses this system, the rich will get richer. I too have thought of the risks of stealing and the loss of customer intimacy if this technology is implemented. For a company like Walmart, that I would not necessary call a customer intimate company, I could see “Scan and Go” being used sooner than later, however, I fear that this technology could spread to stores not suited for such a system. Also, there are many costs that Walmart will have to pay before they can see the benefits of their system.

    Not only does Walmart need to install the kiosks necessary for their “Scan and Go System” they also need to make sure all their products have RFID tags on them. This is where things can get even more complicated, because Walmart has so many different suppliers from all around the world. My dad works for a company who suppliers their products to Walmart, and he said that Walmart was going to force every one of their suppliers to put RFID tags in the products they sell to Walmart. He told me that, while the cost to install these tags would be about one or two cents her product, this would definitely add up, most likely forcing prices to rise. This could be another problem for Walmart because they are a company that advertises “Everyday Low Prices” but prices might have to rise as a result of added costs to suppliers.

    Not only could these raise prices of Walmart products, it might also turn suppliers away from selling their products through Walmart. If a company is forced to put RFID tags in their products, but does not have the means to do so, they might have to consider breaking away from Walmart. This could definitely limit Walmart’s inventory because there is such a strain put on suppliers to continue using Walmart to sell their products.

    I am excited about the way technology this technology can be used at Walmart, but I fear that many generations are not ready for the change, so it may take awhile before “Scan and Go” will be executed by Walmart.

  3. Christina, I really enjoyed the analysis you have on Walmart’s proposal of the Scan and Go system here. After reading this article, the first thing that came to my mind was a similar concept that Stop and Shop has instituted at store locations near my home in Massachusetts. Easy Shop is Stop and Shop’s version of Scan and Go, except it is a hand held device instead of an application on your phone. View the video link below to see how it works:

    Now, one might ask, “how are these two ‘scan-and-go’ systems any different from each other?” Well, in my opinion, they really aren’t much different, and in fact, I am willing to make an argument that Stop and Shop’s system is better. In a world that seems to be coming up with and revolving around new technology each and every day, one might think that this new scan and go system would be more successful. But, in my opinion, I think that using something more similar to Stop and Shop’s Easy Shop would prove to be more beneficial for Walmart. The reason I say this is because people today are all about convenience, and that is what I believe the Easy Shop provides. On one hand, you have an application that needs to be downloaded, and with it being new, runs a high risk of being slow or experiencing problems, which would result in frustrated customers. On the other hand, Easy Shop can be in the hands and ready to go the second the customer walks through the door—nothing to download or worry about. It just worrisome to me that our world is so willing to be reliant on a smartphone that still gives me trouble when I simply try to use the Facebook app let alone anything else.

    My other concern that arose from this article, which you mentioned, is the effect that this technology has on the job market. Whether it is Stop and Shop’s Easy Shop or Walmart’s Scan and Go system, they are both eliminating cashier positions, a very popular job in today’s economy. With unemployment being a major concern these days, technology such as this will certainly not help that problem.

    So, the question I would like to conclude with is the following: is this scan-and-go technology worth the potential damage it provides to an already struggling economy? It will be interesting to see what Walmart decides to do.