Considerations before Choosing Kiosk Terminals

For several years running there have been an average of more than 125 new self-service kiosks installed every day in North America, according to some estimates. Retailers who for years wondered if kiosks were right for their operations are increasingly answering yes. Why is a new kiosk coming online approximately every 11 minutes? Because kiosks have proven to be highly effective tools for making customers happy and improving operations— 88 percent of best-in-class operators improved customer satisfaction with kiosk systems, 63 percent improved customer conversion, and 100 percent reduced labor costs1. Overall, retailers who implemented kiosks improved customer satisfaction by an average of 58 percent.

Although overall adoption is growing fast, the process for developing and rolling out kiosk systems for individual retailers is not. It typically takes at least a year for a kiosk project to go from planning to implementation. To maximize value, most kiosk applications should integrate with existing in-store systems. This takes time, because kiosk applications and development environments are often very different from legacy retail applications, and require different skill sets to develop.

There are also different requirements for the kiosk equipment itself. Employees who run POS systems and handheld computers receive much more training than the customers who will use kiosks. When a POS problem develops, a store associate is right there to perform troubleshooting or at least alert a manager. In contrast, unless intelligent alert and management functions are built into the kiosk, equipment hiccups at kiosks may go undetected for hours, keeping kiosks out of service and frustrating customers the whole time—the opposite of the intended effect. Reliability and the user interface are crucial to kiosk success.

Therefore, there are some leading issues that retailers must consider when deciding whether to deploy kiosk systems. This article will provide an overview of what to expect during the planning and development process, covers the pros and cons of developing kiosk applications in-house or using independent software vendors (ISVs), highlights important design considerations, explains how component features relate to reliability, and identifies the resources and skill sets needed to develop, integrate and maintain kiosk systems.

Kiosk solutions are increasingly common, but they are almost always custom. Retailers rarely have the luxury of buying an off-the-shelf kiosk application. A major reason is because the kiosk design, user interface and application must all be carefully developed to support specific business goals. Kiosks can be used to improve customer convenience, drive incremental sales increases or reduce labor requirements, but a single system is seldom called upon to do all these things.

When determining development needs and capabilities, it is helpful to break the project into three categories:

• Software development and integration

• Hardware design, including component selection

• Daily operational requirements plus regular maintenance and support

In practice, retailers usually customize the software for their kiosk application. Off-the-shelf software is only used in about one out of five kiosk projects, and even then it is often customized, according to 2008 research. Large companies are more likely to handle development in-house, but even large firms frequently use independent software vendors (ISVs) because of the time and expertise required. Integration necessarily involves in-house personnel, but outside firms can do much of the work. Kiosk design and construction is almost always contracted to an outside provider. There is more variation in how maintenance and application support responsibilities are handled. Software and hardware support can each be contracted separately. As with the initial development, companies are more likely to contract for hardware maintenance. Software maintenance and additional application is also often contracted to the ISV, but it is not uncommon for retailers to bring these activities in-house after the initial application development and deployment.

The built-in thermal printer mechanisms provide perhaps the most features, options and performance capabilities to choose from. The built-in thermal printer mechanisms design and features contribute directly to reliability and support requirements. For example, the larger the media capacity, the less often paper has to be replaced, which reduces the chances that a customer will be inconvenienced because the kiosk is out of paper. Larger media capacities also promote better labor efficiency because less staff time is required to load media. Thermal Kiosk printers that are designed to provide easy access for media loading enable more labor efficiency than models that take longer to service.

Decisions made during the design process will impact the time and effort required for successful ongoing operation. Media capacity is just one of many easily overlooked design considerations that contribute to reliability and efficiency. These factors are explored in more depth in the following section.

Direct thermal printing is the dominant print technology used in kiosks and other unattended printing operations because it is extremely reliable. Direct thermal printers require no moving parts to create an image. They do not use toner or ribbons, and thus do not experience the ink spills or ribbon jams and tears that cause downtime. Direct thermal printers print by applying heat to coated paper, which turns dark where the heat is applied. Paper is the only consumable, so thermal printers are restocked much less often than printers that also require ink cartridges to be replenished.

Kiosks are used to improve customer satisfaction or to improve staff productivity and reduce operating costs, so during the development process retailers must do all they can to optimize the user friendliness, reliability and total cost of ownership of their kiosks. Doing so requires careful consideration of myriad details and decisions, and frequently involves working with specialized solution providers. Therefore, retailers should consider carefully what requirement of the Kiosk they need before they make the decision.