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Gift registry kiosk, gift card kiosk: made for each other or not?

They're both valuable retail tools, but do they belong together? Experts debate the merits of integrating or separating gift card kiosks and gift registries.

March 20, 2006

A gift registry kiosk keeps on giving revenues, and gift cards keep customers coming back. So the connection, and the reasons to combine them into one kiosk, seem obvious. But there are plusses and minuses to consider when deciding to integrate the two.

The National Retail Federation, in 2004, tallied Christmas gift card purchases at $17 billion - 15.6 percent of America's total Christmas spending. The reality of gift card profitability is why Ben Wheeler, product marketing director for I-Engage Kiosk Solutions, thinks selling them through a kiosk that also fields a gift registry is a bad idea.

He compared it to integrating bill payment or other financial services on an ATM, saying that it is better to leave the machine unfettered to generate the more profitable ATM transactions, rather than keeping customers waiting with less profitable financial services.

"I think a gift registry on a gift card machine would be a mistake," Wheeler said. "You don't want people who would put money into your machine slowed down by people browsing products."

A gift card dispensing kiosk, designed by KIOSK Information Systems.

In Wheeler's logic, and personal holiday experience, customers often buy gift cards on the fly - they run in, and run out, not wanting to deal with long lines and holiday fuss. But National Retail Federation spokesman Scott Krugman said lines at the kiosk shouldn't be a problem.

"I don't see what the down-side (in combining gift card and gift registry kiosks) would be," Krugman said. "I think the stigma is gone of gift cards being a lazy person's gift. I think seeing it move to gift registries would make sense. The whole idea of a gift registry is so you're not getting the same items, so you're not making returns and I think gift cards play into that kind of ideal."

Krugman said as self-service areas become more popular, it's inevitable that customers must wait in line, but the benefits of waiting for kiosk convenience still outweigh the time cost.

"I don't want to wait in line for an ATM but I do, because ultimately it's faster to wait in line at the ATM than at the teller," Krugman said. "Though you might have to wait in line at the kiosk, it's going to be better than the line at the point of purchase. It also doesn't seem like that would be the only point of purchase for the gift card anyway. There are other places in the store to buy the card. It doesn't surprise me they're being integrated into registry kiosks. It just shows the popularity of this product."

What's Important Opinions are divided as to whether it makes sense to integrate gift card sales with gift registries. Off-site kiosks are the best candidates for integrating the two products, particularly high-traffic areas where cash is the predominant payment method. The oldest advice is still the best: Customer happiness and usability trump all other notions about design.

Wheeler's idea, that the two kiosks should be separate, is not all-encompassing. For example, in an off-site, out-of-store venue, he said combining the two is a good idea.

"Most of the retailers in the world are looking to add to their footprint. If you put a Target kiosk at Churchill Downs (a high-foot-traffic destination), who's to say that's a bad idea? They have money in their hands."

Wheeler said the key to moving the kiosks off-site is to locate them in popular destinations, like Boston's TransAmerica Center, or The John Hancock Building in Chicago. He said placing the units in a shopping mall is harder to do because, if the deployer doesn't have a store located there, the existing retailers on the site will fight to keep the machines out.

"In the store, they need to break (gift registry and gift card kiosks) up, because it's a line buster," Wheeler said. "Outside the store, they need to add functionality."

More research on these key terms: Retail Gift registry Prepaid cards

Forrester Research analyst Tamara Mendelsohn said either strategy can be correct, depending upon deployers' situations. She said gift registries and gift cards are very different in terms of the consumers' goals, but they can be integrated depending upon the deployment. For example, she said, some Giant Foods stores use an integrated kiosk system that presents a different front-end depending on where in the store it's deployed, but allows customers to access all other self-service systems if they click deeper.

In the end, she said, it's about the customer's needs.

"I would always shift the conversation back to consumer goals," she said.