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Network photo kiosks to increase profit

September 2, 2004

Spurred by the use of digital photography, retail store photo kiosks are continuing their dominance. A report by Summit Research Associates Inc., shows shutterbugs are well aware of the ease of combining digital cameras with self-service photo kiosks, and C-stores are preparing to service these customers.

To keep up with market demand and ensure profitability, many shops are looking to take the deployment of photo kiosks to a new level. But industry experts agree that there is more to operating a successful photo kiosk than deploying it and collecting the cash. According to Francie Mendelsohn, president of Summit Research Associates, photo kiosks have reached critical mass. "There is a lot at stake, so you have to do it right."

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An example of a new trend in photo kiosk deployment is to implement multiple photo kiosks on networks that support remotely connected, unmanned units.

"Customers will use these units if they're fast and easy," Mendelsohn said. "There's a lot of money to be made by photo shop owners if they can provide some value-added service."

Deploying multiple networked photo kiosks throughout a chain of convenience stores means the independent operator can increase the number of customers served, enhance revenue and reduce customer acquisition costs.

"Photo kiosks are at the stage ATMs were in the `80s," said Steve Giordano, president and CTO of Lucidiom Inc. "ATMs started off on a one-to-one basis: For every bank you had one ATM. Then some smart people built ATM networks and cash was available everywhere."

The ability to track orders and usage statistics, run reports, view sales figures and get necessary maintenance information - such as which kiosk is down, has a malfunctioning part or is low on receipt paper - can mean the difference in profit or loss to a multi-unit deployer.

According to Giordano, in the C-store environment the photo kiosk would operate as a remote application. Most C-stores would have a partner that does the actual printing.

"The key here is the kiosk flexibility allows C-store operators to figure out what is the best model for them," Giordano said. "The customer can print to a local photo finishing shop or to a wholesale lab, or they could choose to print the photo right in the C-store."

Driving store sales through increased footsteps is not the only motivation to install a C-store-based photo kiosk network. The profit from the pictures themselves can be quite nice.

"In most cases the operator could charge a little more than the local drug store, because it's more convenient," Giordano said.