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Self-serve tech cuts two ways

News, 13 March 2015

CAMBRIDGE, MA: Self-service technologies have the potential to boost a company's bottom line but there are pitfalls for unwary brands as their worth may fall in the eyes of consumers being asked to do the work.

The Harvard Business Review noted that the use of in-store touchscreen ordering capabilities in quick-service restaurants had led to an increase in spending as people tended to order more.

In some cases this was simply because, as Ryan Buell, an assistant professor at the Harvard Business School, observed: "Kiosks never forget to upsell."

But he also drew attention to research which had found customers ordering online were avoiding any negative judgment of their eating habits by store staff.

And a related finding, from a liquor store where sales of hard to pronounce items rose when self-serve was introduced, suggested removing the possibility of social friction – consumers feared being misunderstood or appearing unsophisticated – could help increase sales.

Buell also highlighted "a bunch of downsides", partly based on his own research into self-service technologies in banks, where overall satisfaction with one bank fell as the proportion of their total interactions shifted away from face-to-face channels and toward using ATMs.

"When we're interacting with a person, we can see what's being done to create value for us," he explained, but automation typically removed that. "When customers aren't able to see that effort, they appreciate the service that's being delivered less, and they value the service less as a consequence."

And if a company is asking the customer to take on a greater share of the work, design is crucial, he added, something that supermarkets have yet to crack with self-service checkouts.

Brands often talk of surprising and delighting the consumer but it's hard for technology to achieve this, said Buell, "because it's standardised and is built on a set of rules. But it is possible for technologies to disappoint us."

For the future, he expected that automation would play an important role in "interactions that can afford to be transactional rather than relational".

The places consumers are most loyal to, he suggested, are those where they have been able to develop a relationship, like a local coffee shop where they're known by name and feel special, so making transactions more meaningful.

Data sourced from Harvard Business Review; additional content by Warc staff