Learn the Secrets Top Retailers Use to Maximize Profits
With all of the focus on frictionless retail and popup shops, we have to ask: is there a place in the modern retail strategy for smart vending machines?
The grandfather of the automated retail movement, the vending machine was the first ‘modern’ machine to appear in the early 1880s. Back then, coins went in and goods came out. Except for the increase in payment options, the concept hasn’t changed much. And why would it?
When it comes to convenience, the vending machine as a sales tool is still hard to beat. They provide added revenue streams with minimal overhead costs and extend a retailer’s market reach beyond conventional physical stores. And since today’s smart vending machines can gather valuable insights into consumer behaviour and product effectiveness, retailers can make informed decisions on pricing, marketing and inventory. As for versatility, this is where vending machines come into their own. From snacks, sushi and soda to medical supplies, luxury items and baked goods, it’s hard to think of something that you can’t use them for.
Here are just a few of the ways vending machines are used today:
Carlos Bake Shop ATM
Cake Boss fans can satisfy their sweet cravings at one of the many Cake ATMs strategically located in major shopping centres and airports across Canada.
Carlington Community Health Centre’s Healthbox
The installation of “Our Healthbox,” in an Ottawa suburb made the news before Christmas. Hoping to reduce the barrier that a lot of community members have in accessing different supplies, this vending machine, which sits outside a community health centre, dispenses different sexual health and harm reduction supplies, as well as seasonal items like socks, gloves, and some food items.
Vending machines are not just for soda
While ice cream, cotton candy, and popcorn are becoming popular vending machine items here, in Japan, they’ve found a way to offer pretty much anything. From umbrellas, underwear and T-shirts to hamburgers, fish soup, and flowers, the options are truly endless.
Think twice before you tilt
We would be remiss if we didn’t mention a noted drawback to vending machines. While researching this topic, our millennial team members were surprised to learn that vending machines being rocked or tilted have been known to cause serious injury and death when the heavy machines fall over. A 1995 study found that at least 37 deaths and 113 injuries occurred from 1978 to 1995 due to falling vending machines. Most telling of all, the vast majority of injuries and deaths have happened to men. However, the news isn’t all bad. According to a 2012 report, the odds of someone winning Powerball are 1 in 175 million, compared to a 1 in 112 million chance of getting killed by a vending machine.
Is there a place for smart vending machines in a modern retail strategy?
Of course, things have changed since the mid-90s when that study was completed. Today, smart vending machines have replaced those dusty old machines that spit out old bags of chips and chocolate bars. Manufacturers boast that smart vending is the future of unmanned retail. One where they combine the power of technology with a customer-centric design philosophy, using state-of-the-art software and best-in-class hardware to create a premium, digitalized vending experience.
What Is A Smart Vending Machine?
A smart vending machine uses cutting-edge technology like internet connectivity and specialized software to accept multiple payment methods, offer real-time inventory tracking, and gather insightful data on customer behaviour. The result? An enhanced vending experience for customers and improved management and analysis tools for operators to optimize vending machine performance.
Smart vending machines use a variety of technologies:
Internet connectivity: This allows the vending machine to communicate with a remote server to receive updates, send data, and accept payments.
Sensors: These can include cameras, weight sensors, and RFID readers, which can be used to detect when items are removed from the vending machine and to collect data on customer behaviour.
Software: Smart vending machines may use software to manage inventory, track sales, and perform other tasks. This may include a user interface that allows customers to interact with the vending machine and a back-end system for the operator to manage and analyze the machine’s performance.
Payment systems: Smart vending machines can accept different forms of payments like cash, credit and debit cards, mobile payments, and digital wallet payments.
Data analysis: Smart vending machines may collect and analyze data on customer behaviour and machine performance, which can be used to improve the vending experience and optimize the machine’s inventory and pricing.
Artificial intelligence: Some smart vending machines also use AI to predict demand and restock the product accordingly.
The Benefits Of Smart Vending Machines
Adding smart vending machines to your retail playbook comes with a lot of perks. Not only do they provide an additional revenue stream with minimal overhead costs, but they also expand a retailer’s reach beyond traditional brick-and-mortar locations. And because they’re able to collect valuable data on consumer behaviour and product performance, retailers can make data-driven decisions to optimize inventory, pricing, and marketing strategies.
Here are some key benefits to incorporating smart vending machines in a modern retail strategy:
Interactive Customer Experience: Smart vending machines use touchscreens, digital interfaces, and personalized recommendations to enhance a customer’s shopping experience.
Increased Convenience/Accessibility: Depending on where they are positioned, smart vending machines can operate around the clock, allowing customers to make purchases at any time, even outside of regular store hours.
Reduced Operating Costs: In many cases, smart vending machines allow retailers to streamline operations and reduce the need for staff, cutting down on labour costs. They can also optimize inventory management and reduce the risk of overstocking.
Customer Preferences: Smart vending machines are equipped with sensors and analytics capabilities that collect valuable data on customer preferences, purchasing patterns, and inventory levels. Retailers can use this data to make informed decisions about product offerings, pricing strategies, and marketing campaigns.
Remote Management: Retailers enjoy the convenience of remotely monitoring and managing smart vending machines. They can tweak product selections, change prices, and fix problems from afar with no need for someone to be on-site.
Marketing Opportunities: Smart vending machines can be used as a platform for targeted advertising and promotions. Retailers can display ads, offer coupons, and cross-sell related products to customers to increase sales and revenue.
Space Efficiency: Ideal for locations where traditional retail space is limited or expensive, smart vending machines can be placed in high-traffic areas like airports, office buildings, and college campuses to reach customers without investing in a physical storefront.
Touch-free Transactions: A good fit in today’s health-conscious environment, smart vending machines reduce the risk of spreading germs and viruses, promoting a safer and more hygienic shopping experience.
Refrigeration with Food Safety Shut-off: A crucial feature in smart vending machines, this feature not only safeguards the integrity of the products but also upholds food safety standards, reducing the risk of foodborne illnesses caused by bacteria or pathogens thriving in improperly stored food.
Smart Vending Machine Options
While many smart vending machine features are product-dependent, there are many options retailers may want to consider including in their smart vending machines:
Interactive Touchscreen Interface: A user-friendly touchscreen interface allows customers to easily browse products, view product information, and make selections.
Cashless Payment Options: Offer various payment methods such as credit/debit cards, mobile wallets, or contactless payment options to cater to different customer preferences.
Product Customization: Allow customers to customize their orders by selecting different flavours, sizes, or variations of products.
Product Recommendations: Implement algorithms to provide personalized product recommendations based on customer preferences, purchase history, and trending items.
Inventory Management: Incorporate sensors and software to track inventory levels in real time, ensuring that the vending machine is always stocked with popular products.
Remote Monitoring: Enable remote monitoring of the vending machine’s performance, inventory levels, and sales data to allow for a quick response to issues and make data-driven decisions.
Advertising and Promotional Displays: Use digital screens or banners to display advertisements, promotions, and special offers to attract customers and increase sales.
Temperature Control: If vending perishable goods like beverages, meals or snacks, ensure the vending machine has temperature control features to maintain product freshness.
Security Features: Prevent theft and vandalism with security measures such as tamper-proof locks, surveillance cameras, and alarm systems.
Indoor/Outdoor Placement: Customers benefit from the convenience of purchasing items whenever and wherever they need them, while retailers can maximize their reach and revenue potential by tapping into diverse locations.
Accessibility: Ensure that the vending machine is accessible to all customers, including those with disabilities, by incorporating features such as Braille labels, audio instructions, and adjustable height options.
Data Analytics Integration: Integrate analytics tools to collect and analyze data on customer behaviour, sales trends, and inventory turnover.
What Makes a Smart Vending Machine Great?
A great smart vending machine combines several key elements to deliver an exceptional experience for both customers and retailers. Here are some factors that contribute to making a vending machine great:
User Experience: A user-friendly interface with intuitive navigation and clear instructions is key to winning over customers. The interface should be visually appealing, easy to understand, and responsive to touch or input.
Product Selection: Offering a wide range of high-quality products that cater to different tastes and preferences will increase customer satisfaction and ideally, encourage repeat visits. The smart vending machine should feature popular and trending items, as well as options for customization or personalization.
Reliability and Performance: A great vending machine should be robust, reliable, and capable of handling high volumes of transactions without frequent breakdowns or malfunctions. It should dispense products quickly and accurately to minimize customer wait times. This includes regular maintenance, troubleshooting assistance, and proactive communication with customers.
Convenience and Accessibility: The vending machine should be conveniently located in high-traffic areas and easily accessible to customers at all times. It should offer multiple payment options, including cashless payments, to accommodate different preferences and needs.
Innovative Features: Incorporating cutting-edge technology such as artificial intelligence, machine learning, and IoT (Internet of Things) sensors enhances the vending machine’s functionality with personalized recommendations, dynamic pricing, and real-time inventory tracking.
Security and Safety: Implementing robust security measures to protect against theft, vandalism, and tampering ensures the safety and security of both customers and the vending machine’s contents. This may include features such as secure locks, surveillance cameras, and remote monitoring capabilities.
Additional resources:
Everything You Need to Know About the Smart Vending Machine
The 2 Euro T-Shirt – A Social Experiment
Unlock Your Retail Potential With Guidance From The Experts
Whether you’re starting something new or making changes to your current stores, our team is here to help. Within the CBSF design studio, our team conceptualizes every aspect of your retail environment, creating a shopping experience that your customers will love and helping your brand to grow and succeed.
We’ve had our fair share of ATM, vending and built-in projects. Our design process is rooted in balancing your brand’s strengths, your customers’ experience, your merchandise, and your business growth plans. Everything is explored and considered to develop a thoughtful, yet progressive design plan for your business.
Discover how our team of creative and experienced retail designers can collaboratively bring your vision to life. Get in touch with us to talk about your next project. We can help you make your stores match your vision and bring you closer to success.
