CHICAGO -- C-store retailers have always had a tenuous relationship with vending machines. While some retailers happily place them in front of store or near gasoline pumps to draw extra income, others avoid them to ensure customers come into the store to make their purchases.
Enter a vending machine of a new kind, not the machines that dispense soft drinks and candy bars, the type that everyone has beat on once in a while, trying to get that candy bar to drop. But rather new units that sell small electronics such as iPod music players and related [image-nocss] products, according to a report in the Chicago Tribune.
Touch screens guide shoppers through product information and purchase, a robotic arm retrieves the merchandise, and optical sensors ensure that the product is dispensed before a credit or debit card is charged. The units, from San Francisco-based Zoom Systems, will be in 189 Macy's stores in 32 cities this fall, according to the report.
Their arrival offers a glimpse into the vending industry of the future, a world where new products would be available with a few button touches and card swipes. The United States has lagged behind Europe and Japan when it comes to automated merchandising. But vending-industry aficionados say American consumers are just about ready to accept the notion of using credit and debit cards for vending and buying much more than a soft drink and bag of chips.
After all, the industry reasons, look at what consumers already do for themselves: pump gas, bank at the ATM, purchase products online, check themselves in at the airport and check themselves out at the grocery store.
Cashless vending "opens a whole new marketplace," Michael Kasavana, a professor of hospitality business at Michigan State University, told the Tribune. "What is the world's largest vending machine? The Internet. You can't touch the product; you see it like in a vending machine. The industry has moved away from traditional snacks, hot and cold beverages."
Since early April, customers in a Walgreens in Hilton Head, S.C., can buy freshly popped popcorn from a vending machine, and watch it pop, for just under $2 a bag. At the State University of New York at Morrisville, students can buy 200 products ranging from batteries to eggs to iPod download cards from an outdoor automated convenience store dubbed Shop24. MooBella has introduced a vending machine that can maketo ordernearly 100 varieties of ice cream. And customers at selected McDonald's restaurants and Walgreens stores can rent a DVD from an automated kiosk.
What's ahead? In Belgium, All Seasons Services Inc. of Canton, Mass., is testing a machine that sells beer and wine. Customers show their identification to the machine, which snaps their picture and verifies the customer's identity before dispensing the product. And in Paris, Coca-Cola recently demonstrated a vending machine that along with soft drinks sells downloadable ring tones and games and takes digital photos of customers.
The transitionfrom vending machines to what the industry likes to call robotic storescomes more than a century after Tutti-Frutti gum machines were installed on the platforms of New York elevated trains in 1888. But some old perceptions linger.
In a survey of 1,000 people, 7% said they use a vending machine daily and 11% buy products from them at least a few times a week. Yet 39% of those that participated in the survey by Chicago-based research firm Mintel International Group said they agreed with the statement "It is typical that vending machine food is old and stale."
New technologies that make it easier for operators to determine food freshness are likely to help ease those concerns as the product assortment grows.
Michigan State's Kasavana thinks build-to-order products are the next frontier, for everything from sandwiches to prescription eyeglasses, according to the Tribune report. He also predicts the industry is not too far away from offering specials, such as a reduced price on chips if you buy a soft drink first.
"Those things are easily within the grasp of the current technology," Kasavana said.
There have been some moves in the build-to-suit direction. A Cafe Diem machine from Automated Products International Ltd., St. Paul, Minn., turns the single-cup coffee machine, first introduced in 1960, into a robotic barista. Customers select their hot beverage formulation and program a number into the machine. In future purchases, they only have to punch in their number to have their personal concoction dispensed.
What about machines in business centers that would sell premium chocolates and coffee as well as office products and cell-phone chargers to business travelers, wondered Erin Fowler, a Mintel analyst. "They'd be on an expense account so no one would know," she told the Tribune.
Zoom, the company working with Macy's, also has automated kiosks that sell Sony digital cameras and DVDs and Proactiv skin-care products. Gower Smith, Zoom's CEO and co-founder, sees future applications for health care and wellness products, jewelry and other small, high-value products.
"It's very much in line with the busy lifestyles we're living today," Smith said. "There's a lot of consumers that prefer this type of consumer experience. This is not vending."
Industry consultant John Barsanti agrees that robotic stores have much potential but believes their success will depend on consumer comfort.
"Nintey-nine point nine percent of the time you're going to get what you want, buy you still have jokes about not getting what you want," said Barsanti, a partner at Torridon Cos., Syracuse, N.Y. "People need to be comfortable that if you put your credit card in and want a $50 item, you're going to get that $50 item."
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