What’s in store for 2017? Part 1: Kiosks build on a strong foundation
Most kiosk industry observers believe 2016 was a strong year, and the healthy stock market leads many to feel 2017 will also be a good one. Kiosks continue to expand, thanks to technology that enhances user friendliness and consumer acceptance.
"It’s going to continue to grow, no doubt about it," said Doug Obal, director of sales and marketing at Technik Manufacturing, a custom kiosk manufacturer.
The change in presidential leadership has not brought the spending slowdown that typically occurs after an election, said David McCracken, president and CEO at Livewire, a kiosk software provider. "The general population has a lot of confidence in the economy," he said. "People are adopting technology more."
The election of Donald Trump has been welcomed by most observers interviewed.
"I see that President-Elect Trump is pro-business and not only has kiosks in Trump Towers, but also has slated the labor secretary position on his cabinet to Andrew Pudzer, who is a known self-service advocate," said kiosk consultant Ben Wheeler, known as The Kiosk Guy.
Not everyone agrees with this assessment of Trump. "The biggest challenge facing us in 2017 is uncertainty around business regulation," said Mike Masone, vice president of sales at SlabbKiosks, a manufacturer and distributor of interactive kiosks and signage. "In an uncertain environment, the 'wait and see' approach is universally favored by customers."
Nevertheless, Masone sees the kiosk industry continuing to expand. "Even with uncertainty, there has never been such a nexus of factors driving self-service technology," he said.
Kiosk manufacturers and software developers continue to create new capabilities, such as Wi-Fi networks and virtual reality, which enable retailers and other types of locations to merchandise more effectively and efficiently.
Retailers continue to embrace kiosks
"Retailers are re-inventing the way they present products at retail," said David Anzia, senior vice president at Frank Mayer and Associates, Inc., a provider of in-store merchandising solutions. "Dynamic displays and messaging are a key component to the retailer’s success. As technological advancements continue to make an impact at retail, consumers are expecting more personalized experiences through technology. Displays, particularly interactive kiosks, offer retailers the medium to deliver on these expectations and provide that enhanced customer experience that you can only get in-store".
"We are very confident about 2017 and believe our biggest challenge will be to manage growth across the various verticals we serve," said Frank Olea, president of Olea Kiosks Inc. "We were excited to see so much renewed interest in the United States as a manufacturing giant of great skill and power. Everyone loves the amazing, historical companies that have sprung from Silicon Valley and the luster they've given our country around the world. But at its heart, America is still very much about building great things, not just inventing them. You can have brains and brawn at the same time. America can lead the world in innovation and still continue to lead the world in making things."
"Our new Verona and next-generation Boston kiosks are poised to do great things in healthcare," Olea said. "We’ve just launched a new drive-thru kiosk with more features, more efficiency and at a lower cost. Our new Monte Carlo kiosk will help a lot of casinos build loyalty and drive growth. Last year, we innovated like hell. This year, we're excited to go to market full-throttle."
While technology brings new opportunities, successful deployments require proper execution. Michael Ionescu, president of Ionescu Technologies, a kiosk software provider and operator, said results have been mixed. He is excited about the Internet of Things, but he is unsure how successful it will be.
Internet of Things to be crucial
"The success or failure of that (IoT) will be a driving force," Ionescu said. Much of this depends on the execution.
"In my experience with kiosk companies, you see a lot of people who drive what the most affordable route is; they tend to drive towards affordability versus quality, and quality kind of suffers," he said. He pointed to the recent example of the outdoor Wi-Fi kiosks in New York City.
The city planned to roll out 200 kiosks but only installed eight, Ionescu said. The machines were poorly built, and homeless people would urinate on them and short circuit them, as well as hold pornography parties.
"You see a lot of companies fall short because they don’t feel like thinking through and solving the typical problems," he said.
"That’s the exact opposite of the kind of publicity you want."
The proliferation of retail technology products is another issue the industry has to address, Ionescu said. A company looking to install a kiosk has to have enough reliable information resources.
While he has some concerns, Ionescu said the kiosk market will continue to grow.
Regulations challenge kiosks
Government regulations also bring new challenges to kiosk manufacturers and operators.
"Unfortunately, the new solutions requiring EMV, ADA (Americans with Disabilities Act), banking services and HIPAA (Health Insurance Portability and Accountability Act) compliance are more complex than the cyber-cafés of the early 2000s, so aggregation of new technology into a solution is always the challenge of any new kiosk project," said consultant Wheeler. "The challenge to me is the volume of calls I am taking from people looking for someone to help them navigate through the pitfalls of identifying a manufacturer that can meet their needs."
The PR challenge for kiosks
Reports indicating that McDonald’s will introduce self-serve kiosks to its U.S. restaurants raised a lot of awareness about kiosks in late 2016, for better and for worse. On the positive side, the news reinforced the consumer benefits that kiosks bring in saving ordering time. On the negative side, the reports drew reactions from those who think kiosks are threatening jobs, creating a public relations challenge for the kiosk industry.
"Collectively as an industry, we have a PR mandate," said Asa Moran, sales executive at Meridian Kiosks Inc., a manufacturer of kiosks and digital signage, self-
Livewire’s McCracken was among those who said automation usually removes the more monotonous jobs. Hence, he doesn’t see the threat to jobs as a big concern for the kiosk industry. "Twenty years ago, you saw the same thing with manufacturing and automation," he said.
"Retailers with a strong workforce combine the use of kiosks with their personnel to provide the optimal shopping experiences with added content, information and value services," said Anzia at Frank Mayer and Associates, Inc. "By providing these efficiencies, kiosks afford growth opportunities for retailers to increase traffic and sales. As business grows, so does the potential for additional employment opportunities."
"We are quite positive that self-service frees up people to more productive things than be order takers and cash handlers," said Terri McClelland, CEO at DynaTouch, a technology integrator and developer for self service solutions. "Our insight is that the more college kids that see the trend towards self-service will get into the coding side of the solution and go from minimum wage to highly skilled coders who will never have to work for minimum wage."
ATMs’ experience is instructive
Suzi McNicholas, vice president of marketing at Source Technologies, thinks the banking industry’s experience with ATMs has been instructive on this topic. "Moving the most mundane transactions away from the teller line onto self-service kiosks actually help employees play a bigger and better role in servicing the customer, improving job satisfaction,” she said. “And when that staff can be cross-trained and re-deployed, they are prepped for better roles that include better pay."
Part two in this three-part series will address the expected impact of mobile payments on the kiosk industry in 2017.
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