Kiosk retail is starting to really change things. The photos above are of a Sony kiosk in an airport (this one is at LAX). When you buy something, such as the headphones we picked up prior to boarding, a wonderful servo mechanism goes across and down to collect your selection, then drop it into the chute. [It was so cute, I wanted to buy more stuff just to see it whirr and operate!] Sony launched the first of these in 2006.
Interesting that the same headphones were for sale at a traditional retail outlet right across the hall, for about $10 more. That premium may be sustainable now, while the machines are relatively new. You can't pick up and read the box -- although you can see product information on the touch-screen visible on the machine at the right.
Best Buy also has similar machines at airports. [They could have sold me a Flip video, but there weren't any in the machines I saw. Dang!]
RedBox, the DVD movie rental operation, may have started this trend when they launched circa 2003. They are now reporting rentals of more than 200 million DVDs through their 17,000+ kiosks. They have connections with some 300 different retailers, such as Walgreens and Walmart.
Senior vice-president of marketing and customer experience, Gary Cohen, told Marketing News that RedBox "drives traffic to their stores and we also provide [the retailer] a revenue share."
RedBox is using technology to make things simple for the consumer by giving them fast, easy access to what they want. They use the internet to stay connected to some 12 million loyal users who receive weekly e-mails.
Consultant Michael Krauss, author of the Marketing News article, summed up the value proposition nicely: "Simple, powerful business models that yield value to customers will succeed, whether they are online or off".
My take
Meeting people's wants. Leveraging technology to make it faster, cheaper, better. It doesn't get much better than that.
One of the challenges that service businesses have, constantly and never-ending, is that the cost of human services tends to rise every year. Automation is one answer to this challenge. And the kiosk is one very interesting solution. By leveraging really great back-end systems and computer-powered machines, you can provide local storefronts with a tiny footprint.
You may remember the cigarette machine, a ubiquitous installation in the bars of my youth. Soft-drink machines have never left.
What's your take?
Have you used these machines? Are there others that you have seen / liked / disliked?
PS - I thought it was truly brilliant for Sony to have one of their artists - Celine Dion -- singing on the video playing at the top of the machine. Great cross-marketing!
Resources:
How RedBox is changing retail, by Michale Krauss. Marketing News, Nov 15, 2009. (subscription required)
How RedBox is disrupting the movie rental industry, by David Weinfeld, Digital Signage Insights, July 1, 2009.
RedBox expands into video games, by Andre Yoskowitz, afterdawn.com, June 1, 2009.
Airport vending machines dispense bullion at a premium. PSFK June 25, 2009
