A Blog by Jonathan Low


Jul 22, 2012

JCPenney to Embrace Mobile, Self Check-Out, Eliminate Clerks

Ron Johnson, the guy who created the iconic Apple retail stores, continues to try to apply his previous employer's famously ascetic and simplistic design aesthetic to his new company, mass market retailer JCPenney.

Success, thus far, has been elusive.

He simplified the company's chronic discount culture - and chased away many of the customers who had come to rely on it, driving financial results with them.

Now, he is speculating - in the physically and financially rarified air of Aspen, no less - about eliminating check out clerks and replacing them with self check-out computer stations or, even better, mobile check-out. There is no doubt the technology exists and can probably be installed without too much trauma. The challenge will be getting customers to go along. These devices are generally touted as speedy and convenient for shoppers. Assuming they are working the day you choose to shop. But from airlines to drug stores to Walmart, retailers that have installed them still require lots of staff to help people whose situation is not as simple as the technology vendors might like.

The problem is that everyone has an issue: a coupon, a return, an unfamiliarity with technology or with the English language. And the one line designated for those who want human assistance often snake through the store as the one harried clerk attempts to solve the world's problems without assistance or supervision.

Johnson and the other tech mavens like him point to data assuring investors and customers that it's all good. Or will be once the glitches are ironed out. And he even goes so far as to suggest that at least some of the now redundant clerks will be repurposed to customer service. But the economics of the massive investment in new tech require cuts elsewhere to justify the cost. So JCPenney customers are unlikely to see much in the way of hand-holding.

Johnson is a smart, seasoned executive. He has no doubt thought this through. But businesses tend to convince themselves that the strategies to which they are already inclined are the right ones. This might work. But consumers looking for more customer service, not less, may take some convincing. JL

Kim Bhasin reports in Business Insider:
JCPenney CEO and former Apple retail guru Ron Johnson is speaking at Fortune's Brainstorm Tech conference in Aspen, and he revealed a bit of what his strategy is for store checkout.

He wants to eliminate the employees who stand at cash registers and get rid of traditional checkout by the end of 2013.
Instead, he's pushing mobile checkout and self checkout. The stores will be 100 percent RFID (radio frequency identification) and wi-fi enabled.

JCPenney would reinvest those savings in customer service, he says.

If JCPenney can pull this off, customers won't have to wait in lines anymore, making things more convenient and reducing their time in stores.

This also suggests that there will be more job cuts, since those workers won't be needed anymore.


clipb said...

nfc and variations related thereto looks to be a major gamechanger. let me know if you're interested, i've been following it for a while. also interesting technology review (mit) fb article whichs points to the future of marketing as "likes" and smartfone interactions are/will be exploitable. what a world we live in.

Post a Comment