There are a lot of great ideas for automated retail kiosks circulating in the industry right now. And why not? Consumers love the convenience and instant gratification that a retail kiosk solution provides. Retailers that have embraced kiosks as cost-efficient points-of-presence love how quickly they can deploy these solutions that extend their market reach and provide high ROI. For many reasons, the automated retail kiosk development and deployment is booming. The Global Interactive Kiosk Market Research Report Forecast 2018-2025 predicts the market will exceed $34 billion by 2025, a conservative estimate in our view.
There is currently a lot of momentum toward kiosks as a retail solution, particularly by retailers that recognize kiosks as either a potential disruption to their business if ignored, or an opportunity to expand it if embraced. Ideas for new kiosk concepts are evolving at a rapid pace, such as pharmaceutical dispensary or even automated pizza kitchen kiosks. But some retailers are making mistakes in the development process, some of which are fatal flaws. Many concepts have great potential. For a retail kiosk solution to succeed, however, prototypes must do more than work in the test lab. They must scale to meet the demands of productive use in the marketplace, and withstand the rigors of use.
Sometimes the simple considerations that impact retail kiosk scalability are overlooked. For example, consider a kiosk concept for boutique retail. Consumer demand will drive development, but for a kiosk to reach the audience it was designed for, its creation must consider factors outside the kiosk itself. For example, can a kiosk solution plug in to a standard, 110-volt electrical socket, or will it require 220 volts with special plugs and power supply? A kiosk’s power requirements aren’t deal-breakers, but they will delay projects and add expense. Even considerations of size, such as ensuring that a kiosk can physically fit through a standard-sized doorway, can create major deployment complications. The design of a kiosk concept should always consider ways to reduce complexity and enable aggressive rollouts.
Taking a retail kiosk concept from idea stage to market requires considering technical and non-technical factors alike. Here are some of the problem areas – mistakes – that too often become barriers to successfully developing a kiosk concept.
1.Failing to Size the Market
When developing a kiosk concept, is the potential customer base large enough to support a rollout? Commercial Automation developed an automatic pizza kiosk for a $45 billion industry that had not experienced any significant disruption in years. Markets that have this economic mass and are ripe for disruption are excellent market opportunities for a kiosk solution. Ideally, evaluate and size markets globally, developing a kiosk solution that can reach all audiences in all markets to maximize uses. Disruption is a positive force when it comes to kiosks, as being a disruptive solution encourages and invites a majority of the population into a kiosk solution. While kiosk rollout may focus on specific market segments, design scalable kiosks with a value proposition that allows everyone to participate.
A great example of a kiosk solution concept is for dispensing cannabis. The legal cannabis market is new and growing, and it’s a hot button topic. Where it is legal, there is much discussion about controlling how cannabis is dispensed. A kiosk is an ideal dispensing solution, one that can both make product available, while closely monitoring and tightly controlling how it is dispensed.
2. Overlooking the Importance of Customer Experience
Whether bricks and mortar retail or self-service technology, providing an excellent customer experience is a major differentiator for many consumer businesses. The same care that an organization puts into training frontline staff to deliver excellent service should go into designing the user interface (UI) for a kiosk solution. It’s not enough for a kiosk solution to provide 24 X 7 convenience; that is assumed by today’s savvy consumer. The UI must engage the consumer and provide an exceptional experience that humanizes the transaction.
For example, kiosks can use facial recognition software to identify a consumer that comes to engage. Imagine a consumer who regularly purchases from a kiosk approaching it and having the kiosk initiate a transaction based on recognition. “Welcome back, Sally. The usual order today?” is not a kiosk-initiated exchange based in science fiction, but a current reality. Kiosks can use technology to create seamless, personalized interactions that present superior products through highly convenient, memorable experiences. It’s a mistake not to utilize this capability.
3. Not Exploiting the Consistency Advantage
Marketing research has consistently shown that the dimension of service quality that consumers value the most is reliability: the ability for a provider or vendor to accurately deliver the promised good or service consistently.
Consumers evaluate reliability and consistency across two dimensions:
- Product or service: did the product, good, or service purchase meet consumer expectations every time a purchase occurred?
- Experience: was the experience of the purchase consistently good?
Kiosks excel across both of these dimensions. They are not subject to the variance of human performance. They are never in a bad mood; they never get angry and lose their patience with a customer. Furthermore, a kiosk design can provide consistent presentation of the product it dispenses, and precisely control environmental factors like temperature or humidity for the inventory stored within a kiosk before it is sold. These capabilities are particularly advantageous for food industry kiosks. It is a major mistake to not fully exploit a kiosk’s ability to provide consistent and repeatable experiences for customers.
4. Forgetting the Importance of the Supply Chain
Our earlier post, “Developing Advanced Kiosk Solutions: 5 Critical Success Factors” discusses how the supply chain is an enabler of kiosk development success. The fact that it comes up again here reflects its importance. The simple truth is that an inefficient supply chain will ensure the failure of even the most elegantly designed kiosk.
There are two aspects of supply chain that kiosk developers must consider:
- The product that the kiosk sells
- The components that go into the kiosk
The first of these aspects – the downstream supply chain – is the more obvious of the two. No one deploys a kiosk solution that hasn’t given some thought to the supply chain necessary to supply a network of kiosks with product inventory. Still, those who have no expertise in building and managing supply chains can stumble in the early going, and pay a price for it in consumer acceptance, when supply chains are inefficient.
The upstream supply chain that deals with all of the components that go into kiosk design is as or more critical than the downstream counterpart. What good is stocking kiosks with product if they don’t function reliably? It’s a foregone conclusion that kiosk component failure will occur, and when that happens, the design considerations have everything to do with how quickly a kiosk comes back online. There are types of automation, motors, and circuitry that dictate what the supply chain has to do. The best practice is to balance using forward-edge technology against reliable, proven components so as not impact operational uptime.
Commercial Automation focuses heavily on designing and building units in modular fashion to reduce complexity in the field, allowing for module replacement by personnel who are not kiosk engineers. The effect is to reduce outages and downtime. The modular design also simplifies customization of kiosk solutions for different environments and specific types of customers. It is easier to add features and fine-tune kiosks through modular design. For example, an automated pizza kiosk can have a warming oven, so that the unit senses customer proximity, starts cooking pizza, and then dispenses it when customer arrives.
For all of these reasons, considering kiosk supply chains during the design phase has a lot to do with the ultimate success of a deployment. The strength and efficiency of the supply chain will ensure the viability of a kiosk solution.
5. Forfeiting Speed of Deployment
Lethargy in developing and deploying advanced kiosk solutions isn’t so much a mistake, but a consequence of making the mistakes shared above. Speed of deployment is therefore a decision and value that should drive a kiosk development project from inception. As engineers weigh design alternatives, their impact on agility and speed-to-market should remain a primary decision criterion. The reason is simple: in many markets, speed of entry, of being first, ensures success.
There is a balance to strike between being too nimble and risking creating a solution that doesn’t perform consistently. What’s also true is that many manufacturers are risk averse, but the market rewards those who are first. Developers must find the middle ground for developing kiosk solutions that are robust, while favoring speed to market heavily. How can kiosk developers accomplish hitting this “sweet spot” that balances both? Having a deep, experienced team that understands the technology, supply chain, and even regulatory issues enables success.
Commercial Automation has such a team that can help create innovative kiosk solutions that allow for rapid deployment, with the right supply chains, while providing an exceptional customer experience. Contact us for help building a roadmap to success with your kiosk project.
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