|| The Perspective
Monday, 28 September 2009
It isn’t often that we truly can compare apples to apples when it comes to kiosks. There are many reasons: The applications on the kiosks are different (retail versus financial services, for example). The hardware and software manufacturers are not the same. The placements within the businesses are so different that a real comparison would be unfair.
Recently, however, we did have the rare opportunity to compare two kiosks in two deployments that presented a level playing field. Both kiosks belong to the retail self-checkout vertical market, and both use the same hardware and software from NCR. Furthermore, they are located in the checkout lanes in large big box retailers—Ikea and Lowe’s—and both use the kiosks as an integral part of their customer experience strategy. The difference is that one provides a positive experience while the other leaves the customer frustrated.
Although the exterior appearance of the kiosks is slightly different to allow each retailer to leverage its brand—logos, colors, fonts—the kiosks essentially look the same and operate in the same manner. The usage process is identical: Customers scan the barcode on their items, or key them in, and move the product down to the end for bagging. When all the items have been successfully scanned, customers pay for their purchases, collect their receipt and proceed to the exit.
The kiosk at Ikea was frustrating to use. The built-in scanner did not work, despite repeated attempts, so I tried to use the hand held scanner. That attempt was not initially successful, either, until an employee came by and said I needed to hold the scanner about six inches from the barcode. I asked her "How was I supposed to know that? There is nothing on the screen to indicate that this is how the thing works." She shot me an angry look and walked away. I was serious. The secret to self-service—any kind of self service, including candy vending machines—is don’t make me think. As I looked around at other customers at nearby kiosks, I saw that several were equally thwarted in their attempts to check out. They were looking for another kiosk to use. But once I learned how to use the scanner, I was able to complete the check-out process without incident.
Later that day, I used the kiosk at Lowe’s with no problem. The built-in scanner worked perfectly, and I was able to check myself out quickly and easily. Admittedly, now that I was proficient at using the NCR checkout kiosks from my visit to Ikea, the process was easier to complete.
One problem with the kiosks at both stores was that the numeric keypad was not laid out in the format we all understand, the layout used worldwide on phones. This one is laid out more like the keypad on a computer keyboard. It is not the worst fault one could imagine, but the unusual configuration does slow down a user.
Why was one experience so much better than the other, given that the hardware and user interface were the same? We believe it is because the kiosks at Lowe’s are better maintained and all seemed to work without any difficulty or hiccup. Statistics from our recently published flagship report, the seventh edition of "Kiosks and Interactive Technology," show that the overwhelming majority of kiosk deployers say they maintain their kiosks either directly (using store personnel) or through third-party providers. But having a maintenance contract and actually having preventive or routine maintenance performed on a regular basis are two entirely different things.
What can we conclude? Lowe’s seems to apply more resources to keeping its kiosks fully operational. As far as I could tell, the kiosks all worked flawlessly. The Ikea units were problematic; several customers (in addition to myself) began looking for another kiosk the moment we encountered repeated difficulties. The store, even on a Tuesday morning, was quite busy, and all the other kiosks were in use, so we had to make do. Customers are not given the luxury of finding a human to check them out—it is use the kiosk or leave empty-handed. In a number of cases over the years, we have seen people give up and leave the store, or find a human-assisted checkout line.
Negative experiences can have a significant impact on the likelihood a customer will return to shop another day. But while Lowe’s customers always have the choice of visiting a Home Depot or smaller hardware stores, Ikea customers are less fortunate. The chain simply has no real competition. The choices are too vast, the designs are too appealing and, most importantly, the prices are too low, for their customers to take their business elsewhere. They will return, grumbling about their less-than-happy experience at the checkout counter, but they will be back. It would be nice to know that in the future, they will find kiosks that are as easy to use as those at Lowe’s.
Francie Mendelsohn is president of Summit Research Associates
Monday, 20 July 2009
Deployment agreements define the legal relationship between a supplier of self-service equipment and the owner of the site where the equipment is deployed. Deployment agreements are deceptively simple. After all, most people believe that it cannot be difficult to prepare an agreement to place a machine in a specific location. Furthermore, every equipment supplier uses some version of a deployment agreement and most suppliers have never had a problem with their agreement. However, on those occasions where a problem arises, the terms of the deployment agreement will define the legal responsibilities of the participants and problems arise more frequently than most people would believe.
Every deployment agreement should cover four basic areas. They are: (1) the business relationship between the parties; (2) the obligations, if any, of the supplier subsequent to deployment; (3) the presence of electronic transaction processing; and (4) the allocation of risk between the supplier and the owner of the site.
Initially, the deployment agreement should detail the business relationship between the parties. The agreement must spell out whether the equipment is being purchased, leased, or merely deployed at the site and the payment arrangements. Obviously, it is the financial terms that make the arrangement profitable for the parties. Of course, in cash purchase situations, the payment terms are fairly straight forward. However, in installment purchase, lease, and simple deployment situations, the financial terms are not always as carefully spelled out. Furthermore, in the case of small entity site owners, the identity of the entity's principals is determined and if possible, the principals provide suitable guarantees. There is nothing worse than trying to collect monies from an insolvent deployment site owner. If there is to be a division of revenue between the supplier and the site owner, the terms of such division must be carefully spelled out. This is especially true where the deployed equipment is owned by a third party who is paying the site owner to deploy the equipment at the site.
In a non-purchase situation, the term of the agreement must also be clearly thought out. I recently saw an agreement in which the term was "forever." Apparently, millions of years from now, the ATM machine will still be deployed at the site. The type of merchandise being dispensed, the nature of the area in which the machine is to be located, and the ownership of the site should contribute to the determination of the deployment term. There also should be consideration to circumstances under which deployed equipment can be moved before the end of the term. Occasionally, disputes arise when a site is closed for remodeling or the business being run at the site is changed (such as a drug store to a pool hall). This also is important where the neighborhood changes such as when the Lakers stopped playing at the forum in Inglewood.
Furthermore, many deployment agreements do not contain certain "boilerplate" provisions which are contained in most contracts. These include: (1) a choice of law provision which sets forth the state whose law will govern the interpretation of the agreement. The law of every state is not the same and many states have specific provisions applicable to deployment agreements. Also, in certain circumstances, the Uniform Commercial Code may apply and as adopted, the Code varies from state to state; (2) an entirety provision which states that the entire agreement between the parties is contained in the written agreement. This provision is designed to prevent one party from claiming that oral promises were made which are not contained in the agreement. Several years ago, a dispute arose relating to a CAT Scan Machine where the entirety provision was not included in the agreement. Its absence led to six years of litigation over claims that oral commitments had been made relating to the payment of the lease; (3) a choice of venue provision which sets forth the state in which any dispute between the parties under the agreement is to be resolved. An equipment supplier should pick a convenient state and county forum in order to avoid having potentially to defend suits in many different forums, including small forums where the supplier may be home-towned. Several years ago, I served as an expert in a dispute where a large merchant filed suit in his hometown in rural Colorado. At the trial, the judge admittedly ignored Colorado law in order to help the local resident merchant. Likewise, a decision should be made as to whether the prevailing party should be allowed to recover its attorney's fees in any such dispute. This should be determined based upon the relative economic strengths of the parties and who is likely to commence suit; and (4) a provision stating that the waiver of one breach shall not constitute a waiver of subsequent breaches.
Likewise, the agreement should set forth any specific requirements for the deployed equipment such as telephone or electrical requirements, any exclusivity requirement in connection with the deployed equipment, the times and hours that the access to the equipment should be available (in non-purchase situations), and the like.
Second, any post-deployment obligations of the supplier should be carefully spelled out. This relates to maintenance and repair of the equipment, stocking machine with cash or merchandise, and removing cash or merchandise. If such obligations exist, the responsibility of the site owner to cooperate with the supplier should also be spelled out. Finally, if the site owner is to pay for such services, the site owner's payment obligation must also be carefully spelled out.
Third, many self-service machines (including ATM machines) provide electronic transaction processing (credit card) services. Unfortunately, the deployment agreements generally do not deal with this issue. Electronic transaction processing is big business which generates substantial revenue in residuals to those involved. Generally, deployment agreements fail to spell out who is entitled to receive residual revenue, responsibility for chargebacks, processing rates, and the like. Processing is done by many different banks and different independent sales organizations. The level of customer service, processing rates, add-on fees, and the like varies from processor to processor. Many sites already have credit card processing relationships and they continue with that relationship for the site. Significant revenue can be earned by specifying an appropriate processing relationship in those situations where the deployed equipment is not owned directly by the merchant. Furthermore, if the obligations of the supplier to the site include maintenance or risk management, it is especially important that the processing relationship contains online monitoring capabilities. Also, the owner of the site must make certain that the processing relationship proceeds smoothly since any significant failure or chargeback history could cause the owner of the site to lose its own ability to process credit cards.
Fourth, risk allocation should be a significant issue in any deployment agreement, as follows:
1. Limitations on liability. Most agreements contain a disclaimer limiting the types of damages that can be collected in the event the equipment malfunctions or the equipment is not properly maintained. Such disclaimers normally limit damages to direct losses incurred and exclude lost profits, indirect damages, consequential damages, and the like. Such clauses also normally state that there are no warranties which are not included in the actual agreement. Such provisions can also operate to prevent litigation by limiting the amount and type of imaginative damages that a lawyer can concoct.
2. Damage to equipment and operating losses. The agreement should spell out who is responsible for damage to the equipment. This is especially relevant where the equipment is damaged by a site customer, by a fire or similar natural disaster, or abuse. Likewise, responsibility for operating losses due to vandals or other causes should be defined. Some years ago, an armored car company lost in excess of $70,000 collected on its rounds, including funds for stocking ATM machines. The agreement did not specify responsibility for the loss between the site which owned the machine and the supplier which performed maintenance services. When the funds could not be recovered from the armored car company, the machine supplier had to absorb the loss.
3. Products liability and injury claims. The ingenuity of the human race knows no bounds. No matter how carefully designed equipment, users will manage to catch their hand in the machine, cut themselves on the machine, have the item dispensed drop on them causing injury, or suffer some other misfortune. The deployment agreement should allocate responsibility for such claimed injuries. (See insurance below.)
Also, depending upon the item being dispensed, such items may cause injury to a purchaser. Such injuries run the gamut of a child cutting himself on a plush toy to a adult eating a bad piece of beef jerky. Under most state laws, both the site owner and the equipment supplier are deemed to be in the chain of distribution except in an outright purchase agreement. This means that both may be held responsible under the theory of strict liability. Depending on the products being dispensed, the agreement should specify who has primary responsibility for any such injury and make arrangements for appropriate insurance coverage.
4. Insurance. Relatively inexpensive insurance can be obtained to cover personal injury and products liability. Generally, personal injury claims are covered by existing insurance carried by the site owner. Adding the supplier to the insurance as an additional insured should be relatively simple. Likewise, where the equipment supplier provides post-deployment services, the supplier should have insurance covering same. Obviously, it is in the suppliers interest to makes its own coverage secondary to that of the site owner. As to products claims, the costs of such insurance will vary depending upon the product being dispensed. As with the insurance for personal injury, existing insurance may cover any such claims. This should be explored and resolved as part of the deployment agreement.
Finally, many of the issues involving the structure of deployment agreements can be resolved through the use of common sense. In any instance where a key term appears to be missing, the parties should attempt to reach an agreement as to that term. Likewise, although the use of form agreements is common, not all form agreements apply to every situation. The item being dispensed should make sense for the location where the equipment is to be deployed and the financial terms of the agreement should make economic sense. Unfortunately, common sense is not that common.
Lawrence Washor is an attorney at Washor and Associates, a firm that specializes in the self-service, ATM and credit card-processing industries.
Tuesday, 30 September 2008
Picture this: You are at the airport. You have arrived the obligatory hour to two hours early. The lines are long. An important business meeting awaits 3,000 miles away. You finally make your way to the check-in kiosk, only to find that it won't read your identification card.
You try to get the attention of the airline attendant. You are frustrated. The airline attendant is frustrated. The guy in line behind you is frustrated. The clock is ticking and that security line is not getting any shorter. How could this happen?
Our daily transactions with kiosks are automatic. We rarely think twice when we insert our debit card into an ATM. However, when we encounter a malfunctioning or out-of-service kiosk, we take notice. This disruption to what should be a smooth transaction can cause a costly frustration that tarnishes not only our experience, but also the brand impression.
As a customer-facing technology, kiosks represent a brand experience. Customers immediately form an opinion based on this experience. Kiosk deployers simply can't afford downtime, but to maintain a kiosk involves more than the basic repair to the equipment and that is a cost that many deployers can't afford.
A recent report from Summit Research Associates found that 31 percent of third-party providers assume the repair role for kiosk deployers. That is a trend that has continued to grow over the past few years. A smart trend.
As chief executive of ExpressPoint Technology Services for a number of years, I have witnessed the difficulties that companies face when challenged with repair issues. They need a service provider that is dependable and reliable. They expect the highest quality and quick turnaround. They rely on flexibility and customized programs to meet their unique needs. For kiosk deployers, the pressure for the equipment to be available creates additional challenges including the need for the most current hardware, accurate repair to minimize the domino failure effect, faster high tech peripherals and proper installation immediately. Maintaining an in-house service and repair staff can be time consuming and costly. Simply put, outsourcing your kiosk repair to an OEM or a third- party service provider is smart because it saves you money.
A good kiosk service provider will have a variety of capabilities in place including:
- A full-time planning and forecasting team to guarantee parts are available and warehoused onsite or at stocking locations near your field service teams, reducing freight and keeping your fuel costs down.
- Cost saving programs such as Advance Exchange allow for parts to be sent within 24 hours, eliminating downtime.
- An innovative engineering staff that researches the kiosk industry and equipment is essential in order for your kiosk to receive the most current updates and maintenance technology, ensuring the right peripherals are integrated.
- Warranty management services to make sure that you never have to pay for a part that is covered.
As I watch the kiosk industry continue to grow and develop new technologies I feel very strongly that now, more than ever, it is important to find an experienced and innovative kiosk service provider before the equipment fails. Whether you outsource your repair service to an OEM or third-party service provider you are reducing downtime, saving money and securing customer loyalty and confidence.
Always a smart choice.
David Anderson is the chief executive of ExpressPoint Technology Services Inc., and an association member.
Tuesday, 18 March 2008
You've probably seen a kiosk that has an error message on its screen or even a kiosk that has a blank screen. A non-functioning kiosk is worse than no kiosk at all. It undermines the consumer's trust in a reliable source of content or their trust in the capabilities of the provider.
Sure, we all pretty much understand that computers are not perfect and will need some maintenance from time to time, and that not every company has world-class IT support teams. But you can implement systems that will alert your team when something goes awry, or reboots itself in an attempt to clear the problem. Sadly, many companies that implement kiosks don't want to consider these possibilities, or they are the first thing in the budget that gets axed when trying to make the numbers work. Ongoing maintenance and support are important considerations. On-site warranty from hardware manufacturers, combined with good software infrastructure and a plan, are the basics of maximizing uptime.
But one thing that is perhaps even worse than a non-functioning kiosk is a kiosk that is well designed, has good signage, has a good purpose and then fails to deliver on its promise. I recently saw an example of this at Cincinnati's airport. As you enter the baggage claim area there are two large stations of three kiosks each that promise the visitor hotel information and courtesy phones. When you approach the screen, you see three links: Hotel Courtesy Phone, Visitor Information and Kiosk/Airport advertising information. Obviously, this was put together by whoever has a lock on airport advertising, otherwise why would you give that last topic such importance for a visitor kiosk? When you click on “Hotel Courtesy Phone” you get a page with a bunch of logos of local hotels and basic information on them. This is helpful content for the traveler. If you click a button, it promises to call that hotel for you so you can book a room.
But the phone dialing did not work.
So I tried the Visitor Information in hopes of finding out what to do around town, where to eat, shop and perhaps some quick local history. Nope. The page loaded with a simple but terrible message: "Content coming soon."
I can tell you that these kiosks had already been deployed for months, and still there was no content.
I was disappointed. I was let down by the content provider, not the hardware or operating system. It was simply a lazy provider of content that did not live up to their promise to the consumer.
I wanted to voice my dissatisfaction so I clicked the third link to learn about airport advertising and find the company responsible for the content. But guess what, I found the same "Content coming soon" message on this screen. So even if I wanted to add my hotel to the list, or find out how to help this content provider, I could not. I had to shake my head and let out a slight chuckle that can only come from someone in the business. I should have sat nearby to see how many other visitors would come away from the kiosks with a positive experience. I'm sure I'd have been sitting for many hours.
I was able to find the name of the company responsible for the kiosks and I attempted to look up its Web site on my Blackberry browser. The site was empty too.
However, I just checked it again from my PC at work and it forwards to another site which is also light in actual content, and overly complex in design. They will show rate cards for some items, but not the kiosks. They do digital signage and promotions within the airport. It appears that this is their first airport market.
The kiosk hardware is nice enough, these use a good brand of kiosk enclosures, with touchscreens and phone handsets. I even liked how the power cords were nicely covered where they run into the wall and plugged into a power source in a room behind the wall. Nicely done! So I can find no fault in the hardware installation, no fault in the operating system and the screen design was even decent. But the most basic element, the content, was limited or missing. The opportunity was there, and they missed it. How many people tried to get some value from these kiosks during their first months of deployment and were also disappointed? Those visitors will likely never walk up to those kiosks again. You get one chance to make a first impression and you had better not mess it up. A returning guest at your kiosk will cut you a break when you have a temporary hardware/software failure, but that's because they already like the product you deliver, which is the content. A first-time guest will not give you any slack and will not likely return.
Editor's note: This essay was originally published on Tim Burke's blog in an entry dated Monday, Nov. 5, 2007. Since then, Burke says he was contacted by the content provider, who gave him the following statement:
"We are not offended at all. In fact, we appreciated the input.
The kiosks are intended to be a fun and simple communication device for passengers to reach hotels, and not as much an informative device. But you make some valid points. We shouldn't have advertised the fact that we have visitor information and not have any. Buttons that don't work are worse than no buttons at all. This is something we would have never known without your input."
Burke praised the content provider's response and noted that these are common issues that deployers are frequently plagued with. Issues notwithstanding, he added that it's important for deployers to make sure that content is prepared before launching the deployment.
Tim Burke is on the owner of Electronic Art. His blog can be viewed here.
Tuesday, 24 April 2007
When deployers plan for a new kiosk deployment, it is easy to get caught up in aesthetics such as the size of the screen, design and color, overlooking some essential money-saving aspects. For vendors and end-users alike, here are several behind-the-scenes details that are often overlooked, but can make or break your next kiosk rollout.
Does your kiosk have a power filter?
Anyone who builds or owns a kiosk knows its CPU isn’t unlike the ones found in our home or office PCs. Having a kiosk freeze up can be much more costly, however.
A power filter is like a premium insurance package for your kiosks. Power filters protect the kiosk from power surges and spikes that can come through the electrical outlet, but also through phone and internet jacks. They also clean up “dirty power” and suppress electric noise.
“Electric noise is caused by things near the customer’s facility that they have no control over,” said Mike Honkomp, director of new market development for Electronic Systems Protection. "Maybe it’s in the convenience store next to the ATM machine, or next to a refrigerator where a compressor kicks on.”
A commercial-grade power filter provides much more protection than a common surge protector. Power filters eliminate more electric noise and have a much higher threshold in case of lightning strikes and large power spikes.
“A $180 investment for a power filter seems like a worthwhile investment to protect a $10,000 kiosk,” Honkomp said.
The best service for self-service
When you buy an appliance, a service plan is often included. If and when the appliance breaks down, a service person comes to your house and fixes it (between the hours of eight and four…thank you for your patience).
So what about your kiosk? Having a plan for service and maintenance can lower your kiosk’s downtime from days to hours. More and more companies are supporting their own service teams of certified technicians working for the company, but placed throughout the country for quick service.
MTI is a retail fixture company that has used RFID and targeted marketing as part of its self-service initiative. They have 100 contracted service employees around the country for system repairs, bridging the labor gap between expensive IT contractors and what Vice President Jason Goldberg calls “dusters and fluffers” – store merchandisers who don’t do repairs. MTI’s maintenance crew also performs monthly check-ups on MTI stations in their region.
For those deployers who do not have their own in-house maintenance service, there are companies such as Rhombus Services. Rhombus maintains a nation-wide network of qualified subcontractors specialized in kiosk repair and service.
Rhombus’s president, Jeff Metzger, says it is also very important to synchronize your service plan with the recommended service times for kiosk components such as printers and bill acceptors.
Whether contracted or in-house, you want to make sure your kiosk vendor can provide you with quick maintenance service, whether in-house or sub-contracted. You can’t afford to have a kiosk down for days particularly if you are located in a remote area, while you wait for a technician to come cross-country for a service call. Not to mention, you will most likely be paying the cost of his plane ticket.
Keep an eye on it with remote monitoring
Whether your kiosk is a revenue generator or a customer information tool, downtime is going to end up costing your business. A remote monitoring package is a very cheap and worthwhile feature often overlooked, especially during small kiosk rollouts or pilots.
Through programs such as Provisio’s SiteKiosk, kiosk manufacturers and deployers can monitor amounts of money accepted, printer paper levels and even gather user demographic information. Most importantly, you can be notified if your kiosk goes down through email, SMS or cell phone calls.
Like the service plan, remote monitoring services can be done independently or through a kiosk vendor.
“It’s insanity that more people don’t spend a few bucks for the service,” said Peter Snyder, managing director, International Kiosk Group, Kiosk Information Systems.
Monday, 18 September 2006
After attending The Self Service & Kiosk Show in Orlando, I can’t just walk past a kiosk anymore. I look at them. And I look behind them. And I wonder what is used to ensure it’s working when needed.
When the ATM didn’t work at my bank after a thunderstorm, I wondered: what had they done to ensure customers could use the ATM? It was Sunday and the storm was on Saturday evening. Had it been down that long?
Last weekend, after enjoying a brunch at a local resort, I had to stop at the kiosk in the lobby that was deigned to provide information on local destinations. The screen was black, but did flicker when I touched it or moved the mouse. I wondered what might have caused it to not work or if measures were taken to ensure it would work when someone who really needed it came by.
It’s hard to imagine a device any more out on an island than a kiosk. Maximum uptime is critical in order to fulfill its designed purpose of self-service, and yet they are usually unsupervised.
Quality power is the lifeblood of any electronic system and is vital to achieve the desired performance and uptime. Still, power issues remain a mystery in many industries, even – in many cases – with seasoned technical personnel. The impact on microprocessor-based products have come more to the forefront as technology is designed to deliver more functionality at higher speeds.
To begin understanding and evaluating power issues, it is important to understand the three basic levels of impact on a system: disruptive, degrading and destructive. It is important to know that these levels can occur on any conductor, whether it’s a power source, network cables or phone line when connected to your system.
Disruptive power disturbances cause over 80% of the issues you will encounter, according to numerous power studies. According to Florida Power & Light, over 60% of the various power issues are created inside of a facility from a variety of sources. The sources can include elevators, heating and cooling systems, all the way down to the most fundamental equipment plugged into the internal power grid. Usually disruptive events manifest themselves in unexplained system lockups and result in service calls without the owner finding the cause.
Degrading power disturbances contain enough energy to microscopically erode an integrated circuit and its components. One description of degradation is weakening components, much like rust attacks metal. Degradation will lead to premature component failure if not taken seriously. It may be headed off by paying close attention to disruptive events.
Destructive power disturbances occur when an electronic device is overwhelmed by a large-amplitude, high-energy power event. Typically, lightning and thunderstorms are the culprits. Additionally, over voltage can occur from storms that cause power line damage and construction accidents. In one case a freight carrier backed into lines attached to a building and the over voltage passed to everything inside.
I encourage all companies deploying microprocessor-based products to take the time to understand power issues, recognize symptoms and know what technology will protect and condition. Your uptime may depend on power conditioning, which addresses multiple issues. You may not know which power problem you need to address or when, but using proactive solutions to prevent power problems will make keeping your kiosk on an island less of a frustration and more of a vacation.
Dana L. Davis is the National Sales Manager at Smart Power Systems.