Retail kiosk outlook: 2019 expected to surpass 2018
2018 will go down as a banner year for interactive kiosks, but most industry insiders are expecting 2019 to be even better. Kiosk deployers, manufacturers, integrators and consultants believe the economy is still strong, but more importantly, the demand for self-serve technology has reached a record pitch.
Industry leaders interviewed by Kiosk Marketplace in late December were anxious to get back to work following New Year's Day. Interviewees see the market being driven by retailers who are recognizing the need for in-store technology to assist their overburdened sales associates, a client base that better understands the marketing muscle and operating data kiosks can offer, and declining technology costs.
4th quarter activity drives enthusiasm
Much of the enthusiasm was driven by the fourth quarter buying season, which marked the first time mobile payment accounted for a majority of online transactions, according to Adobe Analytics, while shoppers buying online and picking up in-store rose 65 percent from the year-ago period. Many kiosk providers see e-commerce driving the demand for retail kiosks.
"Mobile pay and mobile interaction are making the kiosk more effective, along with the analytics and biometric options," Dave Adams, senior partner program manager at NEC Display Solutions, said in an email interview.
The recently released 11th annual Global Shopper Study study from Zebra Technologies found 52 percent of retail decision makers said they are converting point-of-sale space to self-checkout stations, and 62 percent said they are changing their POS counterspace to clear space for online order pickup. The investment in technologies that streamline processes, reduce stress on workers and give new tools to sales associates satisfies a growing need for efficiency in the segment, the study found.
The study also found that 42 percent of surveyed store associates said they were frustrated with their inability to help customers because they are under pressure to complete other tasks. As such, 83 percent of retail decision makers and 74 percent of store associates concurred that shoppers can have a better experience when sales associates are equipped with technology solutions.
"While retailers are addressing fulfillment challenges, they also need to provide a more trusted, personalized shopping experience that gives customers what they want, when, where, and how they want it," Jeff Schmitz, senior vice president and chief marketing officer at Zebra Technologies, said in a prepared statement.
The survey findings came as no surprise to Stuart Armstrong, group president and chief revenue officer of Comqi Inc., a content management software and solutions provider.
2019 to surpass 2018
"I'm very optimistic on 2019," said Armstrong, who sees 2019 gaining an additional three to five percentage points over the 15 to 17 percent one-year revenue gains that have characterized the last few years. He said his company has purchase orders in hand, and customers are planning large technology expansions in North America, Latin America, Europe and Asia.
Low unemployment, coupled with more engaging technology, will continue to drive retail investment in self-serve kiosks, Armstrong said.
"They (retailers) are looking for ways to optimize and lower operating costs, and at the same time, they're looking at ways to be able to engage and attract shoppers," he said. "Retailers are focusing on pinpointing communication with customers. The whole ability to have content management systems which are delivering pinpointed messages — the watchwords are really 'relevant' and 'recency,'" he said. "How do you create more relevance for those shoppers within the retail environment and other venues?"
Kiosks play an important role because consumers are receptive to brands that can "speak to them" in a retail environment similarly to what they experience an e-commerce environment, Armstrong said.
"They (consumers) want to be able to go to the stores, and they want to be able to interact with the brands to find out about product information, to have curated experiences when they're in the store… so the retailer and the brand knows who they are, just like you do in an e-commerce environment… and then to be able to check out on your own," he said.
While retailers are closing stores, they are investing more technology in their existing stores, he said. "They've got to create more data; data is key," he said. Such investments include shopper tracking and video analytics to better understand customer behavior. "All of that is getting more sophisticated," Armstrong said, noting that content management systems can deliver more targeted content.
"If they're a retailer whose philosophy is 'stack 'em high and sell it cheap,' I don't know if they have much of a future," Armstrong said. But if the shopping experience delivers high quality customer service which includes a tactile experience with the product, he said, "they know that they're going to do well."
Armstrong is especially bullish about digital signage that can pinpoint content to the individual store, including pricing and inventory information. The cost of digital screens has fallen while the screen technology has become more efficient, he said. This includes the cost of "smart" mirrors in apparel stores, he said, and shopper tracking technology that now brings e-commerce capabilities into the in-store environment.
"You're fostering communities within your stores," Armstrong said. Kiosks, in particular, allow for in-store marketing and transactions.
Chris Gilder, CEO of Meridian, agreed with Armstrong.
"Digital self-service solutions have proven themselves as an effective way for retailers to bridge the gap between physical and digital stores by incorporating technology into the shopper experience," said Gilder. "Along those same lines, we anticipate that the demand for automated lockers will continue to grow as well. While the use case for smart lockers in the retail environment is an obvious one, we anticipate that they'll continue finding their way into other verticals as well."
Technology, meanwhile, continues to create new opportunities. Meridian has been doing more voice integration for clients, Gilder said.
"The amount of RFQs we are getting coupled with the new partnerships we have developed in 2018 strongly suggest an outstanding 2019,” said Chuck Lewis, vice president of Palmer Digital Group. “Our quotes in 2018 started out being requests for 10 or 20 kiosks per RFQ. Toward the end of the year, we were getting requests for hundreds and thousands of kiosks per RFQ. We closed the year with an order for 100 indoor touch kiosks, and that trend seems to keep moving forward."