Business Drivers for Creating Do-It-Yourself Customers

In Baseline last April 2005, Gary Kelly (CEO of Southwest Airlines) and Robert Nardelli (CEO of Home Depot) discussed business drivers for do-it-yourself customers.

Some key DIY information for Southwest Airlines:

• 65% of customers book their own tickets at southwest.com
• Ticketing cost through an agent averaged $10; now it averages $0.75
• Functionality is being added to self-service check-in kiosks to handle more transactions
• People per aircraft (a key business metric) has dropped from 95 in 2002 to 74 today

Some key DIY information for Home Depot:

• Self checkout systems enable Home Depot to re-assign employees to revenue-producing roles
• If each of those re-deployed employees sells one home installation, it equates to $1 billion in revenue
• 1,029 stores currently have self checkout systems
• Four self checkout systems take the space of three regular checkout systems
• Kiosks that handle special orders are being tested
• The average customer transaction has increased 7.3%, to $54.89

(Copyright 2005, Honebein Associates, Inc.)