Article

Kiosks, convenience, and the UK

British convenience store chains are finding kiosks a valuable tool for offering retail goods and online functionality. The main question is how far the momentum can be carried.

March 18, 2002

Convenience stores throughout the United Kingdom follow a similar pattern to the United States - the ATM is well established and long ago reached a level of ubiquity, but the kiosk is not as common a sight.

But several UK projects may point the way for kiosks achieving a high profile at the country's convenience stores.

At the upper end of the scale, BP eyes kiosks as a central part of expansion plans involving its convenience store chain, BP Connect. The first BP Connect store opened in London in December, 2000, and kiosks became part of the package fairly early on. There are now 120 kiosks in use at 75 BP Connect stores.

"The customer reaction was so good that e-kiosks were immediately established as an integral part of the Connect offer," said Gillian Meek, BP UK E-Services manager.

Meanwhile, ATM deployer Moneybox Corp. is interested in managing convenience store kiosks offering retail capabilities. The company envisions a system that works for large chains and community convenience stores, while allowing companies to offer services online without developing the technology themselves.

"We have already invested a lot money in the infrastructure for our ATM system," said Andy McDonald, Moneybox managing director. "Shopping is an obvious extension of what we do, because many of our ATMs are located in convenience stores."

Connecting with kiosks

BP Connect's e-kiosks provide a range of services, from free route-planner and entertainment information to pay-per-use Internet and video e-mail access. The Web-based e-mail is the service's most popular function, Meek said.

"People have less time, work longer and are on the move, spending more time in their cars," Meek said. "BP Connect aims to be a one-stop means of satisfying all their convenience needs. Providing mobile, time-starved people with Internet access and a range of information services is a key element."

BP has kiosks in other countries, from the U.S. to Germany, but the kiosk is key to BP's aspiration of becoming the UK's leading convenience retailer. A crucial element to the puzzle is extending the popularity of the kiosks to people who are not familiar with the Internet and do not have home access, but might be willing to try to go online anyway.

Meek said BP is always looking to refine the kiosks; one recent addition is a black-and-white printer for printing out such items as maps. The kiosk screen is also being modified with the stated aim of making the service clearer, simpler, and quicker. BP is also seeking marketing alliances with large retailers.

A feel for the community

For a large multinational company such as BP it is relatively easy to implement a kiosk strategy. The service was developed specifically for its needs and can expand fairly rapidly.

But for SPAR, which has more than 2,500 stores in the UK, but likes to focus on communities, kiosks can also play an important role. In early 2001, SPAR and Moneybox teamed up to trial a touchscreen shopping kiosk at nine locations.

"The pilot interested me because it was basically an electronic shelf, allowing us to offer non-competing brands and products," said Barry Wallis, SPAR retail development controller.

The kiosk offered closed Internet access to four shopping sites, rather than allowing users to surf the net. The areas covered were sports, flowers, holidays, and tickets. None of the companies involved were major UK brand names, but Wallis said that needed to change if the companies decide to do a full-fledged deployment. The importance of working with major brands was particularly underlined by the collapse of the online flower delivery service taking part in the pilot.

"What is needed is a major brand to attract customers the first time and get them hooked on the service," Wallis said.

Although the trial was essentially a technical pilot, Wallis said, it was also a chance to look at usability. Early trials of the kiosk used a normal PC and mouse setup. This was something that was replaced fairly quickly with a touchscreen monitor and menu-driven kiosk to try and make it as easy to use as possible. This brought up the issue of making the menu simple to navigate.

"It was important to have a common experience across categories as we didn't want to put off people who weren't used to the Internet," McDonald said.

To ensure that customers were aware of the trial SPAR did some marketing and had a member of staff introducing people to the kiosk and explaining the process.

Over the course of the four-month trial over 15,000 people browsed the system, with 2,500 following through and making purchases. The flower service, which was targeted to particular events such as Mother's Day, was particularly successful despite the company's demise, with 30 percent of browsers making purchases.

The right mix

The convergence of convenience stores and kiosks is logical, according to Meek, because the stores fulfill a need.

"By definition, it's a convenient place for a customer to do everything from filling up their car, buying their lunch to logging on," Meek said.

But having reached a point where kiosks and convenience stores are now considered logical partners, deployers have to be aware of what the customers want. While ATMs have quickly become a given for convenience stores, whether the same happens to kiosks is down to the retailers, McDonald said.

"The key things to consider when undertaking a project are local promotion, reliability and household brand names," he said. "We are working on linking up with key brand names and then we will use the research gained from the pilot to engineer the right offer."