Customer Reactions to Self-Checkout Discontinuance

Analysing the impact of reverting from technology to human-delivered service

Rinta-Kahila, Penttinen, Kumar, & Janakiraman — Journal of Retailing and Consumer Services (2021)

Introduction & Research Question

The Phenomenon

  • Retailers are rapidly adopting Self-Service Technologies (SSTs) like Self-Checkouts (SCO)
  • The Twist: Some retailers choose to discontinue or revert these technologies
  • The Gap: Little is known about how this “technological step backward” affects customer perceptions and behavior

Research Objective

“Examine how SCO discontinuance signals a regression in store quality and how this affects technology perceptions and purchase volume.”

  • Does removal damage the technology’s “brand equity”?
  • What happens to customer satisfaction and basket size?

Theoretical Framework: Signaling Theory

Core Theory

  • Signaling Theory (Spence, 1973): Firms send signals about quality to customers
  • Negative Signaling: Discontinuance is an unintended signal that the technology was ineffective or that the retailer is de-prioritizing convenience
  • Hindsight Bias: Removal leads customers to retroactively re-evaluate the technology as having been predictably “problematic”

Hypothesized Effects (-)

Dimension Impact
Satisfaction Negative
Intention to Use Negative
Perceived Simplicity Negative
Basket Size Negative

H1–H4: The act of discontinuing SCO acts as a negative anchor, degrading the psychological value of the technology.

Methodology

Natural Field Experiment: Pre- and Post-Discontinuance Survey

Experimental Setup

  • Treatment Group: Customers who experienced SCO removal at their local store
  • Control Group: Customers whose store maintained SCO service
  • Design: Difference-in-Differences (DiD) analysis

Measures

  • Perceptions: Satisfaction, Intent to Use, Efficiency, Simplicity, Enjoyment
  • Behavioral: Basket size (actual survey-reported purchase volume)
  • Qualitative: Managerial and customer interviews to capture “post-rationalizations” for the removal

Key Findings

Technology Perceptions

The data confirms a significant negative signaling effect on:

  • Satisfaction (Supported)
  • Intention to Use (Supported)
  • Perceived Simplicity (Supported)

No significant effect was found for perceived efficiency or enjoyment.

Purchase Behavior

The Sales Hit: SCO discontinuance resulted in a statistically significant decrease in basket size.

Qualitative Insight: Customers and managers viewed the removal as a “bad approach to customer service,” which exacerbated negative re-evaluations of the retailer’s innovativeness.

Managerial Implications

Theoretical Contributions

  • Extends signaling theory to the context of technology regression
  • Demonstrates that SST benefits (like speed/convenience) are “sticky” — their removal causes active dissatisfaction rather than a neutral return to baseline

Strategic Takeaways

  • Beware the “Step Back”: Discontinuing SST is not just an operational shift; it damages the store’s “innovative signal”
  • Operational Transition: If removal is necessary, managers must actively communicate the reasons (e.g., service enhancement) to counter negative signaling
  • Sales Impact: Reverting to human service can inadvertently reduce transaction volume (basket size)