Last month I wrote about the structural challenges that the vending and coin-operated amusement industries are striving to address, and how if we are to succeed, we must all learn to reinvent ourselves and to communicate with customers in a way that’s meaningful to them. Operators cannot forget that we now are in a new relationship with the location and the consumer; we have become, in effect, social directors and are in the business of entertainment.
If consumers are attracted by state-of-the-art equipment and crave opportunities to express themselves interactively, then this is the type of experience we must provide for them. One way to stay connected with the consumer is through the use of social media, loyalty-rewards applications and electronic promotions. The good news is that we now have affordable platforms to make this connectivity a reality. Even more promising is that new payment systems are broadening the interface between vending machines and customers, allowing consumers to pay with whatever they have in their pockets. Vendors now have access to the same technology as other retailers do, which (as we have heard, over and over again) has leveled the playing-field and given us a whole new ball game.
For the past several years, we seem to have been pushing a rock up a steep slope. At the NAMA OneShow, it became evident that we have passed a tipping-point; the rock has started to roll down the far side, and we are trying to keep up with it.
This made the convention more upbeat and exciting than it has been in a decade and a half. It was very enjoyable to watch the latest technology in action, and more importantly, to observe operators eager to implement these enhancements. This change in attitude was apparent by the positive energy on the show floor. Everyone appeared to be excited, and it has been a long time coming.
Technology is clearly working in vending’s favor. Mobile payment options, interactive touchscreen displays, enhanced remote monitoring technology and the latest generations of route management software are the technological advancements that enable the operator to compete with other convenience outlets by providing a more attractive, engaging and personalized experience to the consumer. Another important change is that today’s vending machines impose fewer limits on the customer’s options. This, of course, is more of a continuing development than a revolution; machines have become steadily more flexible in accommodating diverse package sizes and shapes. And that flexibility is available to accept whatever variety of snack and drink selections customers want and operators are prepared to offer. These include organic and “healthy” food choices that address the growing nutritional awareness on the part of consumers.
Packaging and pricing obstacles also are being overcome by the emergence of micromarkets. I spoke with several enthusiastic candy suppliers at NAMA who have observed a trend toward operators selling bigger bags of candy through self-checkout systems, which they believe are opening doors to many more opportunities.
If today’s Generation Y consumers demand convenience, variety and value and are looking for a different experience, then the vending industry has answered their call. We are limited only by our imagination. As NAMA chairman Brad Ellis, Crane Merchandising Systems, observed in his opening address, “vending has the potential to be the ultimate in convenience in a society focused on immediate gratification. One key advantage is that Gen Y loves to interact with machines; they prefer it over waiting in line. They love technology and convenience. You need to engage them, and keep them engaged.”
For well over a decade, forward-thinking observers in the industry and outside it have been urging vendors to study the marketing practices of convenience stores and fast-food restaurants (and coffee shops), which are our principal competitors. From the earliest days of full-line vending, alert operators have been aware of the value of promotion, and suppliers have been eager to assist them with programs whose conduct and results can be tracked. The obstacles imposed by dispersed, remote points of sale, pricing in nickel increments (at best), the need to vend items one at a time, as separate transactions, and the time involved in applying – and removing – signage always imposed severe constraints on our ability to conduct the kind of promotions that are common in other retailing channels.
But not any more. Networked machines, affordable consumer-responsive displays and pricing systems of unprecedented flexibility and sophistication have, indeed, leveled the playing field. It really is a whole new ball game, and the vending industry is coming to bat.
Game on. The reinvention is accelerating. What are you waiting for?