Walmart continues to take a proactive stance in mobile and is reportedly testing a mobile service enabling shoppers to scan items in store aisles with an iPhone before heading to a self-checkout kiosk to pay.

The new Scan and Go service is being tested at a single store in Arkansas, according to published reports. While customers will be able to scan items with their iPhone,  they will not be able to pay via mobile at this point.

“The chain is looking at how to reduce the footprint of the cash wrap and push it onto the floor,” said Stephen Burke, vice president of the mobile practice at Resource Interactive, Columbus, OH.

“I see this as an important step from an industry leader in terms of scale,” he said. “When someone the intergalactic size of Walmart does something like this, it is more interesting.”

A Walmart spokesman said the retailer continues to test new and innovative ways to serve customers and enhance the shopping experience but declined to say anything specific about Scan and Go.

Reducing costs
The mobile checkout service is currently being tested by employees at the Arkansas store and has not been rolled out to shoppers yet. Users will be able to transfer a list of items they have scanned to a self-checkout kiosk and then pay in one step.

The idea is to reduce the amount of time shoppers have to wait online to pay for their purchases.

Using mobile to enhance the checkout process has been gaining steam with retailers.

Walmart’s iPhone app.

Last year, Shop & Shop rolled out an app that enables shoppers to use their mobile phones to scan, tally and bag their groceries (see story). At the same time, retailers such as Sephora, Lowe’s and others are equipping sales associates with mobile devices to enable them to assist customers and in some cases to check them out. And, JCPenney has said it will replace its cash registers with mobile checkout devices by 2013.

Mobile checkout systems are ostensibly being offered by retailers as a way to cut down shoppers’ wait times for checking out. Such a service could appeal to shoppers who are buying smaller items and do not want to have to wait on a long check-out line.

However, many supermarkets installed self-checkout aisles a few years ago, touting them as a time-saving convenience for consumers. Last year, these same retailers began removing the self-checkout aisles because the wait times often were not any shorter and they still required someone to man them in case shoppers had any problems.

The real reason retailers may be so interested in mobile checkout is because it could help them reduce the costs related to checkout.

“The cash wrap [the checkout counter] is the highest cost location in the store – it occupies a lot of space and doesn’t display merchandise,” Mr. Burke said. “Clearly there is a cost benefit to Walmart if this were to roll out to scale but what does it do for the consumer?”

Valuable data
Walmart could face several challenges in making the strategy work.

First, the retail chain will need to deal with the issue of validating that a self-scanned item has been paid  for, which could be a challenge on a chain wide basis.

The retailer will also need to educate  consumers on how to use mobile checkout and give them a reason to do adopt this new behavior.

One of the ways that Walmart could make the service more attractive to consumers would be to present users with a related offer from a manufacturer when they scan an item. Additionally, Walmart could provide access to product ratings and reviews.

Walmart is also working with other mass market retailers to develop a mobile payments platform. It is possibly the company is looking at how to roll Scan and Go into such a mobile payments service, giving shoppers  a way to scan items via their smartphones as well as pay for them.

A mobile checkout service is valuable to a retailer such as Walmart because it enables them to accumulate data related to what shoppers are interested, data that it can sell to manufacturers.

“If retailers are clear and assert the right amount of control over the in-store experience, they should be able to tie up consumer packaged goods manufacturers for delivering offers to phones the same way that manufacturers are paying to sell from the end cap,” Mr. Burke said.

“Mobile is ultimately a new revenue stream for them – the question is how large and how soon,” he said.

Final Take
Chantal Tode is associate editor on Mobile Commerce Daily, New York