Russian big box retailer Okey is testing Scan&Go checkout solutions in one of its Moscow hypermarkets. As retail.ru reports, customers holding the retailer’s loyalty card can scan their products as they shop, avoiding handling purchases multiple times and speeding up the checkout process.
In the recent past, other Russian hypermarket operators have introduced new solutions for their large format checkout operations. This is mainly due to a shortage of floor staff in the capital, while simultaneously trying to make the one-stop shopping experience more attractive for convenience-driven customers who are short of time. German Globus has been experimenting with Scan&Go technology in the capital since the end of 2016, and Auchan, in its newest Moscow mega store in the AviaPark shopping centre, has separated checkout scanning from the payment process to decrease waiting time.
There has been little noise from Okey’s hypermarket business during the first half of 2017. Official information released by the retailer has mainly revolved around its DA! hard discount banner and big box technological innovations. The latter has on the one hand concerned improvements in the company’s loyalty programme such as the introduction of a co-branded credit card as well as a mobile application; whilst on the other hand has been regarding the enhancement of its grocery delivery service scope.
Now Okey tests Scan&Go. Is this part of a larger plan or just one measure aimed at decreasing operational staff costs? While conducting store checks and interviews with key Russian retailers during the last few weeks, we observed that most hypermarket operators have been expanding their customer value proposition – with Okey lagging behind.
At one extreme, French Auchan is developing its Eastern European no-frills discount model, abandoning meat service counters in its latest concept, in favour of pre-packed meat elements. Hot corners and delicatessen counters – a traffic-building range strongly developed by other competitors – still look the same as in stores built five years ago. Clearly no investment went into this cost-intensive production area. The checkout area features more self-checkout desks and we were intrigued to see separate payment terminals, located behind the cashier’s desk.
At the other end of the spectrum, quality-driven German Globus has added to its remarkable fresh range, featuring a culinary and delicatessen island including a large selection of sushi, as well as an increased assortment of own production smoked fish, sausages and sheet cakes. With its adjacent restaurant, pizza corner and bistro area, Globus sets a standard unparalleled anywhere in Moscow, even in the premium Azbuka Vkusa stores we visited.
So where does Okey position itself? The former flagship Rostokino store in the north of Moscow hasn’t changed much in terms of its layout. Yes, the retailer’s price entry brand ‘To, Shto Nado’ (То, Что Надо) is now more visible across all categories; but this can also be said of Lenta’s ‘365 days’ (365 дней) and Auchan’s ‘Kazhdy Den’ (Каждый День). The bakery and chilled section feature a couple of shelf units presenting food-to-go items, but without visual support this novelty gets lost among the standard assortment.
In our opinion, with its coffers almost empty, Okey is biding its time, avoiding pricey refurbishments or costly promotional campaigns until new CEO Miodrag Borojevic presents the details of his turnaround strategy. With Lenta, Auchan and Globus picking up speed, we will be curious to see in which direction Okey is heading. Scan&Go might be innovative, but in terms of strategy we consider it nothing more than a publicity stunt. With dacha season starting, the coming months will mean slow traffic for all large formats. Plenty of time to test.
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