Kiosks Deliver the Goods

This article was originally published in Retailspeak Magazine

Today, retailers are serving a new breed of customers who are technology savvy, time constrained and less willing to wait in line than ever before.

The new service demands of these consumers center on the kind of quick, easy transactions that in-store kiosks can provide. In addition, kiosks offer customers full control over the buying process—and this has proved extremely compelling with other next-generation in-store solutions, such as self-checkout.

This assumption is backed up by a recent survey conducted by a Radiant Systems customer. The study found that 76 percent of consumers preferred using kiosks to being served by a store associate.

But in spite of their ability to increase efficiency and service, kiosks have experienced mixed fortunes to date. Gill Mander, retail analyst at Gartner G2, says, "Kiosks have not always been successful because many require a high level of customer interaction while delivering relatively low utility. Our research shows that customers will use kiosks for certain tasks, such as finding the price of an item in store or checking promotions, but the information must be quick and easy to access."

The bottom line is that kiosks must deliver fast, efficient, reliable service, without taking too much of the customer's valuable time. Mander says, "If kiosks require customers to navigate their way through 16 sub-menus, they are never likely to finish a transaction. It is critical for kiosks to give users access to an application within a couple of keystrokes."

Alex Camara, managing director of Coinstar UK, says, "We spend a disproportionate amount of time working with customers to test our Graphical User Interfaces (GUIs). From the initial concept, we use quantitative and qualitative research to develop solutions that meet customers' real-world needs."

Meeting customer needs through POS kiosks

One factor that is critical to success is the ability to offer services that customers truly want. Many successful kiosks help customers make so called 'distress' purchases, according to Camara. "Just as the ATM enables customers to acquire cash without visiting a bank, kiosks are enabling users to add minutes to their pre-paid mobile phones and access information on products and services quickly and easily, without the intervention of in-store staff."

As well as providing an enhanced customer experience, Camara says kiosks enable retailers that traditionally operate online to extend their products and services to the high street. He says, "Online retailers can now offer kiosk-based access to their products and services. Where these services are presented correctly, these retailers can increase visibility and reach a wider audience than ever before."

Lorie O'Neil, Radiant Systems' Director of Marketing, Self-Service Kiosks, says, "We have been enjoying significant success in a number of markets, including hospitality, convenience stores and cinema operators. The build-to-order sandwich market, for example, is extremely well suited to delivery via kiosks because they eliminate the 'interrogation' process associated with taking orders and free up staff to build sandwiches."

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Improving fortunes

The introduction of touch-screen GUIs has been a significant breakthrough for kiosks. Camara says, "People have taken to touch screens very well. The customer experience is so much better than it is with push button machines. Installed in high-traffic areas of the store, kiosks that offer the right services are now growing rapidly in popularity."

Camara also places great importance on the physical appearance and location of kiosks. "In the past, it was not unusual to see a kiosk from 15 feet away and have no idea about what it did. We make sure customers know what a machine is offering them from at least 18 feet away. Machines are positioned according to their function; with our coin counting kiosks positioned at the store entrance so the customer has the chance to convert small-denomination currency and spend it in the store."

O'Neil is also aware of the importance of location. The company has developed more rugged kiosks that can operate outdoors. This has been particularly useful in the cinema ticketing business and in the fuel/convenience market where customers can order food from the gas pump and collect it in the store.

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Reaping the rewards

As a result of recent technology developments, kiosks have the power to change the retail business model for the better. While the cost of kiosks and integration projects has an inevitable impact on retail margins, retailers can make significant savings by taking labor out of their POS transactions.

Camara says, "As well as saving on labor, kiosks can ensure trade from customers who would simply leave the shop if they had to wait in a line. This can reduce the number of lost sales for retailers."

O'Neil adds, "Instead of waiting in line, customers using kiosks are engaged. This gives retailers the opportunity to advertise their latest products and promotions. Cinema operators using our kiosks, for example, are offering concessions (popcorn, drinks and so on) along with tickets. This is increasing sales significantly. Convenience store customers are also increasing the size of their average purchase through up-selling."

So are retailers reacting to the new opportunities kiosks offer? O'Neil says, "We are currently seeing evidence of increased uptake among our customers. This not only applies to new builds, but also 'retro-fitting' of existing outlets. Everyone in the industry is saying that kiosks represent a huge and relatively untapped market. There is no way it is not going to take off."

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