News

Chile: Kiosks For Everyone

Kiosk usage is accelerating in this South American nation. But deployers are still looking for ways to overcome the poverty divide that keeps some people from trying kiosks.

March 20, 2002

In Chile - for many years the fastest-growing economy in Latin America - the use of kiosks in everything from hotel lobbies, retail stores and public buildings is steadily growing in popularity.

More than a decade of robust growth in the Chilean economy has made the country a favored investment target for international investors. And some of them say that the kiosk market's growth potential is enormous as the public, retailers, and the government become accustomed to the new technology.

"There is an explosive growth expected for the next three years," said Mario Bravo, NCR Corp's Chilean division retail director. "Kiosk is the emerging technology as the ATM market is more mature."

Added fellow NCR director Rossana Malevan: "Last year was a year of trying the concept (kiosk) with a lot of pilot projects, and as those projects showed results this is the roll-out year."

Hotels and kiosks

Any businessman taking a trip to Chile's capital, Santiago, and settling in at one of the city's many five-star hotels will probably run into a kiosk that tells them all they need to know about their stay.

Take the Marriott Hotel, which has an elegant kiosk strategically located in its lobby. The kiosk offers guests information on Santiago along with the rest of the country. On an attractive touchscreen guests can check out dining and shopping options, information on touring nearby ski slopes and vineyards, and obtain tourist and medical information.

Local kiosk manufacturer Mataveri, one of the pioneers in the Chilean kiosk industry, designed the Marriott machines and kiosks at the Hyatt. Mataveri developed the FreeTouch Info System application and designed its own kiosks with touchscreen technology. The company began to install them at Santiago hotels in 1985.

"When we began in 1985 there was no hardware available nor software for self-service information, and because of that we were obligated to develop our own product," said Mataveri sales manager Isabel Meriz.

"Today our kiosks with the FreeTouch Info System are deployed in Santiago's 40 principal hotels and it is an important (information) tool for the hotel guests as well as the personnel," Meriz added.

Meriz said the next step is the continued installation of kiosks in hotels, along with a few at companies and public buildings.

At the airport

If the same executive who came down to Chile on business has to travel within the country, kiosks again enter the picture through Chile's largest carrier, LanChile.

NCR and LanChile installed kiosks last year at Santiago International Airport and at four regional airports to speed up boarding times for business executives.

The kiosks at the airport can perform a number of different services for the customer, including printing boarding cards to avoid long lines at ticket counters.

"We have (automated) the problem of the boarding card," said Bravo. The year-long project has been such a success that other carriers are now interested in kiosk technology, he noted.

After trying out the new technology with its customers, LanChile is now considering implementing the same kiosk technology on its international flights.

"(The project has) more value in terms of visibility than in number of kiosks - because everyone sees them at the airport," Bravo said.

At the banks

Even though some of Chile's banks have been kiosk pioneers for several years, the country's only state bank, BancoEstado, has faced an uphill struggle to migrate its four million clients online due to its many low-income clients.

But the bank is seeking help from the kiosks to promote Internet use among its clients, said BancoEstado e-banking manager Hernan Saavedra.

"We will launch a pilot project in April in which the bank will begin to install 10 kiosks at branches in Santiago and in the regions with specially trained employees who will invite the customers to navigate on the kiosk to discover the benefits (of) online banking," said Saavedra.

In promoting online banking to its customers, customer understanding will be the key to success, said BancoEstado chairman Jaime Estevez.

"It seems to me that it's more a problem of knowledge than access," Estevez said.

A lot of people are not high income earners yet still have access to personal computers, either at work or school. But they are not aware of the potential benefits of owning one, Estevez said, explaining why the bank will push for online banking with the help of kiosks.

BancoEstado's kiosks have been purchased from Diebold's Chilean distributor and contemplated an investment of $60,000, said Saavedra.

Most of Chile's banks today have their branches equipped with ATMs and kiosks side by side in 24-hour access areas. Saavedra said BancoEstado will follow suit next year with the installment of kiosks next to its roughly 700 ATMs.

Fernando Irizarri, general manager of Chilean kiosk manufacturer Proyexion, said banks understood early on the potential of kiosks because of their experience with ATMs.

"Banks were the first (users) and the promoters of kiosks in Chile," Irizarri said. "For the banks it has been a cheap investment because a standard kiosk costs around $4,000 while an ATM cost some $8,000."

"One of the main reasons why the banks pushed kiosk deployment was that they understood the great benefits with having a machine answering general information questions instead of a human teller," he added.

Proyexion makes kiosks for many of the local subsidiaries of the international banks that operate in Chile, such as Spanish banks SCH and BBVA, and U.S.-based FleetBoston.

One of Chile's largest banks, SCH subsidiary Banco Santiago, is using its Super Web Matico kiosk alongside ATMs in its 24-hour access area.

The Super Web Matico has a slick and elegant design and permits the bank's clients to perform a wide range of informative services, including checking out account and credit card balances, transfer funds, check stock prices, and buy and sell shares.

Kiosk, Internet or both

Like most Latin American nations, Chile features a significant amount of people with a lot of money - and huge masses that live in poverty. Internet penetration among the population has been slow as a result, but Irizarri said that is where the kiosk can fill an important function.

"Even if the governments in Latin America seek to inform their citizens online it's a fantasy to envision a PC in every home, (not) in a region where buying food and paying the bills is still the main priority for the great majority," he said.

"The PC is like the car; it's for people with money, but the kiosks are like busses - more economical and more available - so most people can use (them)," he added.

Between 5 percent and 10 percent of the Chilean population own and use PCs at home, which is why kiosks have such great potential in all areas of society, said IBM retail store solutions manager, Andean region, Alejandra Venier. But Venier added it was important for the government as well as kiosk makers to have a critical mass of people ready to use the new technology.

"If not, a pilot project will end up as just a pilot," Venier said.

The Chilean government does not have its own network of kiosks yet, but a kiosk project is in the works, said Venier. She noted that Chile's government has been a Latin American pioneer in putting information online, which should make it easier to implement kiosk projects at high-profile locations such as supermarkets, malls, subways, and public buildings.

Bravo agreed with Venier's assessment. He said that approximately 500 "pure" kiosks (not just personal computers turned into kiosks) have already been installed in the country.

"It's a tremendous market and it will be the next market (for major competition)," he said.

"When the government sees that the kiosk technology has a massive penetration in society, it is likely to act," Bravo added. He noted that this could happen soon because of the speed of kiosk penetration in all sectors of the Chilean economy.

Into the crystal ball

Competition from major international firms could be a highlight of the Chilean market's growth in future years.

IBM launched its own standard-made kiosk in Chile in mid-2001 and expects to be a market leader within four to five years, said Diego Matus Torres, IBM retail stores solutions manager, Latin America. The company is also experimenting with voice technology for kiosks in Chile.

NCR is still the clear leader on the Chilean kiosk market according to Bravo and Malevran, who said the company has installed or sold about 400 of the 500 kiosks they say exist in the market.

Chile and the rest of Latin America still lag behind the U.S., Europe, and some parts of Asia in kiosk development. But the region is catching up fast, according to Matus Torres.

"I believe that each country has its characteristics but I've seen some very interesting projects in Chile," Matus Torres said.