During CES in Las Vegas in January, Maeve McKenna-Duska, VP and Marketing of Strategic Development of USA Technologies, offered her insights on unattended retail during a one-on-one fireside chat. Below are a few takeaways.
Why is unattended retail important?
Unattended retail, as an industry, has been around for many generations. Vending machines sitting in a corner at a business location, in the hopes that people walking by would buy something with the cash in their pocket, was the basis of the business strategy. There was little need to innovate, and even less reason to invest. Now, consumers demand more. They want all retail experiences to be more personal, more contextual, and more targeted. They expect all the benefits of their online experiences to carry over to their in-person ones and brick and mortar stores are running to figure out how to adapt and change to meet these new consumer demands. The good news is, we now have the technology to support those changes, and the market poised to benefit most is unattended retail.
The once old, antiquated unattended business is now incredibly relevant. Connected machines which now accept digital payments are offering personalization through AI, loyalty and rewards in a way that is harnessing both the convenience play – putting product where people need or want it – as well as leveraging new technology that provides personalized experiences without requiring a personal exchange. The reality of consumers thinking: “I want you to know me, and what I want, but I don’t want have to talk to anyone to get it” creates a perfect storm for the unattended retail company that chooses to invest in technology, and is a great example of the old and new retail models coming together and learning from each other.
How do you look at the market now with competition in digital payments platforms?
The rising tide lifts all boats. The more digital payments platforms are offered, the more consumers get comfortable with digital payments applications, creating more demand in our customer base. Those unattended retail companies not willing to invest are being bought by companies in our space who are more innovative.
When a company goes from cash to cashless, what happens?
Consumers who visit their machine are no longer limited to the two dollars in their pockets. Customers buy more expensive items, and have a better experience through faster card or digital wallet purchases like through Apple Pay. The business owner gets about a 30 percent increase in revenue. And the purchase isn’t anonymous anymore. The owner can get smarter about who’s buying their products, how often, profile demographics and be more selective about their goods and services.
What about Amazon Go and their cashless, automated checkout?
Amazon Go is real, and validates our business model and that of our customers. A version of Amazon Go, referred to as micro markets, has been around a long time and is also accelerating with our customer base. Micro markets are taking the place of attended convenient stores where labor is expensive, or when a machine might give the appearance that items are less fresh. Amazon Go saw an opportunity and took it up five notches. Now customers in our micro markets are leveraging innovative technologies to make the consumer experience better.
What application have we not seen in unattended retail?
We envision in the next three to five years that big box retailers and brands that consumers have high affinity toward will show up as pop-up kiosks in locations where consumers live work and play, such as schools, workplaces, airports or railway stations. No more driving to a store to buy the product they want. But it’s not just larger retailers and brands that will benefit. Small entrepreneurial companies will benefit from pop up kiosks because they won’t have to invest in real estate, or labor. Consumers will know what to do, and shopping for their favorite items in a pop-up kiosk will become a standard experience.