Self-Refund Kiosk

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I take it all back.

KIOSK EUROPE: How did the idea for a self-service refund solution originate?

Dave Kuhn: The idea was born out of collaborative discussions with our clients, but it is obviously best understood on the background of the development of self-check out solutions over the last 10 years. Self-Service Refund is basically an inverted self-checkout kiosk, which allows customers to return goods and get their refund. Its development is the logical consequence of a phenomenon that we have been observing for quite a while now –the acceptance and usage of self-service (per device) is disproportionately higher the more devices are being installed in any given environment. By offering even more self-service choice – as with self-service refund – retailers can drive both their efficiencies and the acceptance of already installed systems, so they are effectively winning twice.
 
KE: What do you see as causing the link between the number of devices and acceptance?

DK: It is a very interesting phenomenon, and a number of factors do play a role. By installing a higher number of self-service devices, retailers actually deliver the original promise of self-service, i.e. more choice. Customers acknowledge this. Secondly, an increased percentage – let’s say at least half – of self-checkout devices in a venue does create a very notably different perception among both customers and staff towards their importance. As a result, both will take self-service much more seriously and will engage with it far more deeply. Realising these benefits, acceptance and usage go up above average.

KE: Is it not pushing the envelope to already introduce new self-service applications when ‘classic’ ones, such as self-check out, for instance, are nowhere near their saturation point? Can’t one have too much self-service?

DK: No, one cannot. The best results are achieved with a 100% self-check-out installation, even if you choose to man a good proportion of these with staff as you maximise the number of service points in the store. We see the most advanced retailers choosing this path. Ultimately, it is the customer response which matters. Currently, this largely divides into three sections: about 5% of the users will not engage with self-checkout at all and will need to be assisted through the process, and about 10% use self-checkouts autonomously and are enthusiastic about it. Around 70% of all retail shoppers are agnostic – they want the best possible service, and if self-service delivers this, they accept it right away. If assisted service is offered instead, they are just as happy, although this will be much more expensive for the retailer and mean they miss out on opportunities to redeploy labour to improve on-shelf availability or provide sales consultancy.

KE: How does the self-refund solution work?

DK: In a typical retail environment, the solution allows shoppers to return goods for a refund by first scanning the item and entering relevant product information. Next, the item is inspected by a store associate who can approve the return. A reimbursement is then issued in the manner the item was originally purchased – debit, credit, cash or gift card.
 
KE: Would the solution not make even more sense without the need for an attendant?

DK: Yes and no. One could be thinking about a RFID based solution here, which would ensure that the product is actually still enclosed in the packaging. Clearly, the environment to operate such a solution economically has not yet arrived. However, we believe that the attendant will always be there. The point is not whether the application can be operated unattended by staff, but how much benefit for the retailer can be generated. Every single count of a self-service transaction performed is a significant benefit to retailer, however little the percentage against the overall number of transactions may be. As the percentage gets bigger, the savings multiply.

KE: Many retailers operate a fairly generous refund policy. After all, a dissatisfied customer comes back to the branch with the intention of leaving satisfied – a great opportunity to create long-lasting customer loyalty. So why would I want to leave this opportunity to a kiosk, and not to my staff?

DK: First of all, there is still an attendant, so the customer does receive personal feedback. Moreover, self-service refund solutions enable the retailer to offer more refunding capacity at any time, but primarily at peak times, such as after Christmas, when most refunds happen. Also, don’t underestimate the privacy aspect. There are a number of goods people tend to be embarrassed to return. They will welcome and prefer the convenience of a kiosk to perform these transactions.

KE: Has self-service refund been developed with any particular markets in mind?

DK: Obviously the more returns and refunds a retailer has to handle, the more beneficial the solution will be to him. As a general trend in customer behaviour, we have seen an increase in purchase of more items than are actually required, e.g. a mother that buys the same piece of clothing in different sizes to ensure she has got the right size when it is fitted to the child at home, knowing she will be able to refund the items she doesn’t need. It is the fashion retail industry which by far has the highest returns rate. Food in comparison has a very small returns rate.