|| The Perspective
Monday, 28 August 2006
On our trip to Western and Upstate New York this past week, Bryan Harris and I traveled more than 500 miles by car to tap the knowledge of nine innovative self-service firms:
ShoptoCook, Buffalo – ShoptoCook creates content delivered through a kiosk for grocery stores to help consumers get meal ideas while at the store. Customers can look up a product, find a recipe that contains the product and print a recipe with all the ingredients listed so they can complete their shopping. The content is available to stores on a subscription basis and is uploaded remotely. We met with CEO Frank Beurskens, who pointed out that we would be hard-pressed to find the word “kiosk” on their website. They prefer “interactive technology” or “customer-facing technology,” because “people say ‘we’ve tried kiosks and they didn’t work.’” Beurskens cautioned against focusing too much on technology since it can lead one to think about “what you could do versus what you need to be doing.”
ANS Marketing, Hamburg – ANS is an ATM ISO that is branching into DVD rental kiosks with a brand they call Boxer Video Galleries (the name was inspired by President Joe Harris’ dog, a boxer). Boxer is doing two things that seem new and different: they offer in-wall-mounted units, similar to ATMs, and “video galleries” (they also make a stand-alone unit). The video galleries are 400-500 square foot retail stores, ideally located in a shopping center. With one door which customers can only enter with a credit card or membership card swipe, the lobby can be open 24/7. Renters can use cash or credit cards to rent movies. The kiosk also dispenses stored-value membership cards, which offer savings or “movie bucks” to create loyalty. The kiosks are manufactured by Italian-based Videosystem. ANS is deploying three simultaneous pilots on September 9 in Hamburg, N.Y.; Brooklyn, N.Y. and El Paso, Texas.
A Door Six digital sign waits to ship.
Door Six, Rochester – Door Six is a digital signage company launched in 2004 by Jim Odorczyk (his last name sounds like Door Six). Jim’s experience in the kiosk industry goes back to 1982 with a company called Inter-ad. We had a “It’s a Small World” moment when we learned that Jim and Elo's Greg Swistak both worked at Xerox at the same time (each man’s first job out of college) and that Jim hired Greg’s former company Factura to make the enclosures for Inter-ad. Jim sold Inter-ad in 1992 and started a custom touchscreen business called National Integration Services. Jim sold NIS to Elo in 1999. Door Six is marketing simple digital signage at an affordable price point. The product is called Brightboard, which has a 19-inch screen that can be mounted on a pedestal or hung on a wall or from the ceiling. The stand-alone unit runs off standard memory flash cards with no custom software needed; it can display jpegs, mpegs, PowerPoint slideshows, etc. The networked units can have content uploaded remotely.
Eastman Kodak, Rochester – We had a two-hour meeting with Dave Jones, WW Product Line Manager for Kiosks, and Rowan Lawson, WW Marketing Manager for Kiosks. We were given an overview of Kodak and where kiosks fit into their business. Lawson said that Kodak is very serious about kiosks and that kiosks are very important to the company. They have a strong position (#1 in distribution and share of printing) in virtually every country. As the methods of capturing and using pictures continue to evolve, Kodak’s goal is to give consumers the ability to share pictures anytime, anywhere.
IBM, Rochester – IBM’s world headquarters is in Armonk, NY, but Cort Johnson, manager of the national kiosk/ATM practice, is based in Rochester. Johnson was the SSKA president for the past three years and was reelected in March to serve two more years on the Advisory Board. Johnson took us to visit two deployments of IBM kiosk products. At Martin’s (part of the Ahold and the Giant food stores chain), we checked out the Shop & Scan handheld scanner and the related kiosks loaded with applications including: item locator, recipes, deli ordering and cake ordering. Interestingly, the recipe I printed out indicated it was “powered by ShoptoCook.” Next, we headed to Sam’s Club to see the latest Fuji photo kiosk developed by IBM.
IBM Global's Cort Johnson, manager of national kiosk/ATM practice, relaxes at his Upstate New York home.
Elo TouchSystems, Rochester – Elo’s headquarters are in California, but their custom touch screens are made in Rochester. We met with Greg Swistak, former executive director of the SSKA. Swistak is a great teacher and explained all the different types of touch screens (resistive, surface acoustical wave, capacitive, infrared, etc.) and the pros and cons of each. Elo has come out with a new technology (acoustic pulse recognition), which uses clear glass (no coating) and transducers around the perimeter. As the name implies, it responds to sound, so it can work with the touch of a finger, card or stylus. We also toured their facility and saw touch screens being assembled.
Ultimate Technology, Victor – Nick Daddabbo, a member of the SSKA Advisory Board, recently moved from Hand Held Products to Ultimate Technology. Ultimate is a POS manufacturer that has recently branched into self-service with the KwikUse kiosk, built for ticketing, gift registry, etc. We also met with Dave LaBudde, VP of marketing & business development. LaBudde explained the history of the company and the request from client Kerasotes Theatres that led them into kiosk sales. He also shared with us the news that in the inaugural RIS News Hardware Leaderboard Survey released in July, Ultimate was ranked #1 by North American retailers in the POS Systems category.
Hand Held Products, Skaneateles Falls – At Hand Held, we met with Don Thompson, marketing manager; Lisa Danese, marketing coordinator; and Lisa Chalupnicki, supervisor, OMC. Hand Held, a division of medical products company Welch Allyn, has approximately 900 employees with offices around the world. While the majority of Hand Held’s product line is mobile computers, handheld imagers and transaction terminals, they have a product specifically for the self-service industry: the Image Kiosk 8560, a mini kiosk that can be used for price checking, product information and loyalty programs.
Hand Held products marketing manager Don Thompson demonstrates the Image Kiosk 8560, a combination price checker/mini kiosk that can also function as a miniature digital sign.
Optical Products Development (OPD), Elmira - OPD President and CEO Ken Westort has several patents and several pending for his 3-D optical technology. The company got its start 10 years ago developing optics for flight simulators. Now the company is turning its focus on its Promo Driver coupon dispensing kiosk, which uses a 3-D “floating image” or holograph to attract attention. The kiosk has a 23-inch digital sign above and a 19-inch touchscreen below the 3-D image. OPD does not plan to sell the kiosk, but to place them in grocery stores, using a revenue-sharing model from manufacturer advertising.
Tuesday, 22 August 2006
"Baby boomers are all about being in control. This generation wants to control everything, from the food to the words to the order of the service. And this is one area where consumers feel out of control."
Those of us in the self-service industry have heard and read quotes like this several times: consumers want more control over transactions. It's the key principle that drives our industry. So here's a shock, this quote isn't about retail service — it's a quote in a recent New York Times from funeral concierge Mark Duffey, describing consumers' choices to plan their own funerals.
It reads exactly like the case for deploying an ordering kiosk: The consumer wants more control. So where are all the casket kiosks?
Funerals are a $14 billion annual industry, with a guaranteed two million customers per year. Funerals cost $6,000 on average, and often more than $10,000. It's a healthy industry, with nothing but growth on the horizon.
Before accusing me of cold-hearted casket kiosk peddling, this is far from unprecedented. Costco deployed casket kiosks two years ago. According to author John Dicker in "The United States of Wal-Mart," the discount giant also is kicking around the idea of casket sales. Web sites are selling caskets — and suggesting upsells and cross-sells. When users order an Irish Tribute casket from CasketXpress.com, the site entices them to pick up a Claddagh Candle, Irish flag and "Dreams of Ireland" framed poem for the casket top. These kind of automatic cross-sells and upsells are what good transactional kiosks do.
And this alleviates another problem: the inherent non-compete atmosphere of a funeral home. Instead of taking one funeral director's (read: one salesman's) advice at a very emotional time, kiosks simplify comparison shopping and can help a family find a better opportunity when money will likely be an enormous concern.
If all this is too impersonal, add on a "have the planner contact me" button and the consumers get the human touch, while the vendors get sales leads.
The one big problem I see is where to put them.
Funeral homes might like kiosks for the same reasons most retailers do. It would allow them to offer more inventory with less showroom space. But such traditional, high-touch businesses are unlikely to want such non-traditional devices. Besides, the casket companies with which morticians have long-standing relationships might get testy about sharing the kiosk with competitors that couldn't fit in the room before.
Then there's the Costco model, but I'm not sure how effective it has been and Costco wouldn't tell me. I imagine they might keep their casket sales a little under the radar, given the business's unsettling nature. And it's hard for me to imagine picking up caskets, coffee and copy paper in one trip.
So that leads me to this: Progressive middle- and high-end consumers like buying all kinds of things in posh little boutiques these days. So why not set up comfortable lounge-style shops with overstuffed chairs and free lattes in the same strip malls where the Mac stores and Paneras go?
Smartly-clad greeters can hand customers (we'll call this demographic the 'to-be-deceased') tablet PCs with kiosk software on which they can browse while they curl up in the cushions. If they have a question, they can ask the greeters. If they want to be left alone, they can retreat to more private areas of the store, or draw curtains at tables.
Call me crazy, but the same desire for control that drives all transactional kiosks exists in the funeral industry. And the demand will never falter. Critics laugh at all great ideas, and all of those critics eventually need caskets.
Monday, 14 August 2006
Today’s leading companies are looking to technology to help engage customers and enhance the customer experience. The problem is too many companies start with the technology first.
If you’re thinking you can deploy kiosks, digital signage, or any other customer experience technology by choosing a kiosk enclosure, a plasma screen, or a web site to leverage, stop! Technologies are important - extremely important - but they are only a part of the solution.
To create powerful customer experiences, you need to start by understanding your customers - the ones actually interacting with your business in your aisles, your lobbies, your physical environment. If you understand their drives and expectations, you’ll be able to create the customer experiences that keep them coming back again and again.
Customers are great at asking the question “What’s in it for me?” The more you can build your experiences to answer this question, the more success you will create. To do this, you have to understand what drives them, how to talk to them, and what’s important to them while they’re in your presence.
This means not only identifying the basic demographics, psychographics, and other various marketing insights, but asking: why would your customers benefit from using the desired technology?
Believe it or not, too many companies look to deploy digital signage and kiosks without doing an analysis of the business objectives and benefits from deploying these technologies.
Putting up plasma screens to simply run 30-second TV spots is unlikely to deliver additional value to the customer interaction. While showcasing an existing website on a kiosk generally causes more problems than solves in an in-store environment.
Worse than not carefully defining the business objectives is focusing solely on the business goals to the detriment of the customer objectives and ultimately the project. Look around the market and you’ll see evidence of too many projects that cut too many corners, had too small of a budget, or failed to accurately measure the intended results. In the end these projects either cost the company more money to rework or died a slow death while antagonizing customers and hurting the business.
To avoid these pitfalls, it’s important to understand how these technologies can fit into your existing business infrastructure and deliver compelling results to the business and the customer. Asking the right questions up front can help a business understand the various benefits and tradeoffs as they build out a technology solution.
The key is to match up your customers’ requirements and expectations to a solution that meets your business objectives. Once you’ve analyzed the business objectives and matched them with the customer objectives, it’s time to identify the unique environmental and location issues related to deploying public-space technologies.
How many times have you seen a kiosk buried in the back corner of a store generating no traffic, or digital signage screens placed 15-feet over the head of customers blaring audio out of tiny speakers. These environment choices can have lasting negative impressions on your brand and business.
To create an engaging customer experience the technology has to play well within the environment. From material choice of an enclosure (wood, metal, plastic) to traffic flow to lighting, ambient noise, and customer access, each location should be analyzed to ensure that the device matches customers’ expectations, the brand experience, and the operational and logistical issues of the store itself.
Once you’ve analyzed the customer, business, and environment issues, then you need to select the technologies that can best address these issues and provide an adaptable and scalable solution.
Customer experience technologies consist of a variety of technologies from hardware to software to networking and systems integration. Each chosen technology, from the PC that drives the experience to the screen that displays it, can impact the customer experience.
Brian Ardinger is Nanonation’s vice president of business development.
Monday, 07 August 2006
Another columnist kindly responded to my last question: Why don’t we convert price checkers into self-checkout terminals in store aisles? Read his answer in a moment. First, read this month’s question.
For years we’ve been told that RFID, also known as radio frequency identification, is about to permeate the market. But is RFID ready for widespread deployment? While a lot of optimism surrounds the technology, there are some concerns.
At a recent security conference in Las Vegas, a graduate student demonstrated the ability to steal data from RFID tags that companies have said could only be cracked by their proprietary readers. The researcher, Melanie Rieback of Vrije University in The Netherlands, and her helpers promised to make public the schematic and computer code for building a portable device that reads RFID codes and tags.
She calls it the RFID Guardian, on the premise that a person can use it to monitor the RFID chips carried on his or her person – in passports and the like. Another way to consider it might be as the RFID Assailant, if one uses it to snag data from other people’s RFID chips.
Rieback is far from the first scholar to crack a code. When a team of researchers cracked the DES code used to encrypt ATM data, they spent almost $250,000 and three days computing 88 billion different code combinations needed to crack the single encryption standard– a much grander undertaking than the handheld box Rieback’s team can use to scan RFID chips without the owners’ consent. (Triple DES is the remedy.)
Rieback also takes credit for writing the first RFID virus: a code that when written onto an RFID tag can make its way through middleware and infect a database. Since the same database is accessed when making and reading tags, all new tags would contain the infected code, if the database is breached.
A vice president for one of the world’s biggest RFID innovators told me that item-by-item RFID tracking is not likely to be adopted by retailers because it’s too expensive.
Retailers frequently talk about the 5-cent RFID tag: Once RFID tags cost a nickel each, it could be feasible to put them on everything, just like price tags. For now, however, retailers still quibble over the price.
So, I ask you to tell me – is RFID ready for widespread deployment? E-mail me your answer: email@example.com.
The answer to last month’s question.
Wirespring columnist Bill Gerba kindly used his column to respond to mine last month:
“…for any kind of in-the-aisle checkout system. Small specialty retailers wouldn't seem to need the extra checkout locations, and department stores already use scattered checkout stations (or sales reps) as a means to scan and de-badge purchased merchandise. So, limiting the argument to just grocers and the big-box guys, there would appear to be (at least) three critical factors that must be addressed before in-the-aisle checkout could ever take off...”