Stop & Shop Finds Self-Checkout Kills The Deadly Roundup

When Stop & Shop was in the middle of a self-service trial, it discovered an unanticipated fringe benefit of the handheld product scanning device: It slightly boosted revenue from customers on a tight budget. Traditionally, budget-constrained shoppers have a specific dollar amount they can't go over. During a routine shopping trip, these shoppers tend to add up prices in their heads and will quit right before they hit their limit, on the rationale that it's better to slightly undershoot than overshoot. To do this easily, the shoppers rounded-up the figures, so that a $4.51 package of soup mentally becomes $5.

But when customers had a screen in front of them with a precise count, they felt more comfortable buying more because they knew they'd still be under budget, even if by only a few pennies. For example, a consumer with a budget of $100 for the trip would often spend $91 or $92, which is the result of a couple of dozen items being rounded up. But if the consumer has a precise readout, they might spend a few more dollars to get closer to $99. "The precise pricing can get them to buy more," said Mike Grimes, an executive VP with Modiv Media, one of the companies involved in the Stop & Shop trial.