Where has all the help gone?

Sit; roll over; goooood customer

Even today, most people don't like grocery self-checkouts, and only 5% have deigned to try a hotel check-in, Forrester Research reported. "Given the choice, consumers prefer not to use kiosks."

Still, 91% of shoppers surveyed said they'd use the self-checkouts anyway, IHL found. And after six uses they gave the machines a near-unanimous positive review. That's where incentives -- or disincentives -- come in, to get customers "past this hump."

It's common behavioral training, the same method used to train dogs.

"Shaping a behavior means rewarding one baby step after another baby step until you have achieved the final behavior you want." Oops, that's from the pet-training manual "The Dog Whisperer." But it's the same idea. Some strategies include:

• Rewards. Southwest Airlines began selling tickets online in 1996. Less than a year later, with online sales at just 5%, it offered double miles. When online sales hit 53% in 2003, Southwest dropped the incentive to 50% more miles. When sales hit 65% in early 2005, Southwest dropped all bonus miles. Online sales continued to rise and are now at 74%. "We did that to establish the booking habit," said Chris Mainz, a Southwest spokesman. "It worked."

• Punishments. Some airlines charge fees for tickets not booked online.

• Specials. Airlines offer some low fares available only online.

• Speed. Though two-thirds of Americans now use airline check-in kiosks, Forrester found, 63% do so just to save time; only 12% don't want to talk to a person. Overall, the kiosks got a low positive response, under 25%, yet were still heavily used to avoid waiting in line.

• The illusion of speed. Shoppers say they use stores' self-checkouts for the speed and convenience. Actually, cashiers do the job faster, said Lee Holman, the lead retail analyst for IHL. But shoppers are under the illusion of speed because they are busy working, not waiting. And there's often a shorter line.

• Discounts. In Boston, transit riders were charged $1.70 instead of $2 if they bought a magnetic card from a kiosk. Transit officials saw the number of complaints about the new system drop by half within six months as riders adjusted.

How companies profit

"The best place you can save money is by cutting jobs," said Mark Damron, the general secretary/treasurer of the Industrial Workers of the World.

Retail stores typically use one cashier for four self-serve checkout lanes and say they "redeploy the labor" to other areas. "But I've seen one for six lanes," Damron said. "Soon it will be one for eight.

"Maybe they don't fire people, but what they don't do is hire replacements," he said. "So, through attrition they cut down on jobs."

This isn't new ground. Self-service has decimated employment in many industries for decades.

In 1988, 308,000 gas-station attendants worked in this country. By 2000 there were just 140,000 (New Jersey and Oregon require them), said Peter Honebein, a co-author of "Creating Do-It-Yourself Customers." Travel agents have dropped, too, from 124,000 agents in 2000 to 87,600 in 2006.

When United Airlines adopted automated check-in, the airline reduced its front staff by 36% and saved $35 million, Honebein said. On average, it costs major airlines $3.02 to check you in with an agent and just 14 to 32 cents if you do it yourself at a kiosk, Forrester Research found. Online check-in costs even less.

And consider this: When you resolve an issue yourself online, you save that company $7 to $12 for a simple call or $45 to $90 for complicated one, said Zachary McGeary of JupiterResearch.

"If they can get you to work for free, they'll do it, and in this case they're getting you to do the work for them as the customer," Damron said.

But wait, there's more. Companies not only save with self-service, they also earn more. Wrap your overworked mind around that one. Here's how:

• People buy more. Customers spend 39% more per order at fast-food kiosks and are twice as likely to upsize than if a person takes their orders. (Machines are programmed to ask every time, and no one can overhear.) Customers also buy more at deli kiosks in supermarkets.

• More people buy. Good Web self-service allows for far more customers to be adequately served.

• People remain loyal. "You mean I'm going to have to upload all my data into a new bank? And learn a new system? No way."

• People give the company high marks for customer service. Yes, funny but true. It's hard to complain about a food order that you placed yourself, a transaction that you scripted or the way you pumped your own gas. When customer service is self-service, you have only yourself to blame.

Published April 4, 2008

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