selfserve kiosks poised for explosive growth in retail

By 2007, sales could reach nearly $1.3 trillion in kiosk transactions.

Self-service kiosks are a growing trend in retailing that is expected to accelerate five-fold in sales during the next two years. By 2007, sales could reach nearly $1.3 trillion in kiosk transactions, something savvy convenience store, truck stop and travel plaza operators need to consider capitalizing on.

This exploding sales phenomenon has launched a rush by retailers to develop their own kiosk strategy to respond to this growing consumer demand. Self-service kiosks are unique because they benefit both the consumer and the retailer. These benefits are quite substantial, enabling consumers to gain control over their own purchasing by providing them with a myriad of options that allows them to customize their orders to fit their personal needs.

Another big benefit to consumers is that self-service kiosks provide an excellent way for them to shop “in-and-out” fast if their time is limited. For the retailer, benefits are huge, including: cost savings associated with labor; managing order process flow more efficiently; and providing a dynamic, interactive tool to market their variety of products to consumers. Kiosks are beginning to make their way into the consumer mainstream, and a number of markets— especially those in the retail industry—are beginning to convert in droves.

As consumers are introduced to more and more kiosks as part of their shopping experience, they will become less intimidated by this new technology and will soon actively seek it out. Much like the ATM revolution in the mid-80’s, self-service kiosk technology is poised to take the consumer by storm as the bricks-mortar version of the Internet. This rapid consumer mindshift during the next five years will force many retailers to install self-service kiosks if they haven’t already. Industries such as the airline and hotel channels are quickly finding tremendous labor savings for check-in through the use of kiosks.

Quick Growth
Mainstream industries—including convenience and travel centers—are poised to see tremendous growth with kiosks. Implementing a kiosk rollout in one store—or a chain of stores—is fortunately far-less daunting than it may appear. A kiosk can either be a standalone unit or one that is directly linked into a store’s technology platform. Generally, the A-to-Z process from concept to actual rollout can happen in less than two months. In addition, a retailer can generally expect to generate paybacks on capitalemployedin two years or less. The key to accomplishing a successful, moneymaking kiosk rollout is effectively planning and managing the rollout and its costs. Expertise in kiosk implementation is critical to managing not only pilot store tests, but the subsequent rollout.

Failure to implement a well-planned, well-managed rollout will definitely increase your overall costs, not to mention unnecessarily burdening your existing staff, hampering their ability to manage the system once it is up and running. That being said, kiosks can provide the retailer tremendous upside on two key profit and loss fronts: managing expenses associated with labor and increasing top-line revenue by enticing consumers to make more purchases through introductions of new products, up-sells and combo offers.

The ultimate winner will be the retailer who aggressively rolls out selfservice kiosks system-wide in order to capture the total marketing and sales potential that kiosks deliver at the store level and home office. Kiosks essentially provide the infrastructure from which merchandising and marketing programs can seamlessly stream through store operations directly to the consumer. This management system becomes a tremendous ancillary benefit to the retailer, ultimately allowing them to more effectively manage and sell their products to their consumers on a national, regional or store level.

The future is bright in retailing, provided that we continue to deliver what the consumer wants: more options they can choose from in less time, customized to their needs. Internet-age consumers are beginning to want that same speed and customized simplicity in their retail-store buying experience. Retail industries that can deliver on this consumer desire will prosper during the next decade. Those that choose to continue to deliver their products and services in a slow, methodically way will find themselves at a distinct competitive disadvantage.


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