Remember when the ATM was the only self-service box sitting in your convenience store? The decision to sacrifice retail floor space for a cash machine was easy. After all, ATMs take up a fairly small footprint when weighed against the benefits of surcharge revenues, foot traffic and purchases made in ATM-acquired cash.
Today, a growing number of consumer-facing products and services seek to capitalize on a consumer base that has become accustomed to self-service technology inside their local convenience retailer. They point to the success of the ATM in providing additional revenue, promising similar or greater returns. And, suddenly, an entire wall has become the store’s self-service suite: the ATM, plus bill-payment kiosks, Bitcoin ATMs, ticket-purchase machines, lottery and more. But are all these machines really worth the space?
How do consumers really feel about self-service machines?
Just a few short years ago, self-service was on a slow and steady march into the retail space. But, similar to e-commerce and mobile banking, COVID lockdowns forced consumers to modify their behavior. After a few months or more of relying on self-service technologies, permanent adoption saw a massive spike.
Today, the majority of Americans (84%) say they actually like interacting with self-service kiosks. In many cases, they will choose to use self-service over an in-person interaction. Nearly every U.S. consumer (90%) has used a retail kiosk in the past two years.
As expected, younger generations are leading the charge for self-service kiosk use. Over three-quarters of Millennials (76%) and Gen Z (84%) admit to preferring tech-based payment options. And Gen X and Baby Boomers aren’t that far behind in their adoption, clocking in at 57% and 46%, respectively.
The initial adoption of self-service can be largely attributed to forced behavior modification. However, e-commerce hasn’t maintained its advantage. Post-COVID, 94% of consumers headed back to in-person retailers ,and Forrester anticipates nearly three-quarters of U.S. retail sales will be made in brick-and-mortar locations. So, why isn’t self-service following the same trend?
What do consumers look for in their self-service?
Ongoing enthusiasm for consumer self-service technology is based on genuine benefits. Things like trust and convenience are important factors. Interactive displays, increased visual stimulation and personalization are also influencing consumer preferences.
But really what it boils down to is that consumers believe machines, with their personal input, can reduce errors, take less time and cater better to their needs. They tell the kiosk what they want, take the appropriate action and get exactly what they requested.
Cash? Delivered in seconds.
Digital gift card? Waiting in your inbox or text messages.
Pay your bill? Done.
And the number of things consumers will do at a kiosk is only increasing. According to a 2023 TNEX Analysis, 44% of consumers want to pay their bills via a kiosk, 30% want to reload prepaid cards, and 37% want to purchase or reload gift cards.
But it doesn’t stop there. The things consumers would perform on a self-service kiosk seem ever-expanding and includes, but is not limited to:
- Perform money transfers
- Cash money orders
- Redeem lottery tickets
- Book tickets
- Pay or receive funds from loans
- Get their tax refunds
- Top-up their mobile phones
- Pay or receive winnings from sports betting
- Perform cryptocurrency transactions
- Load their Amazon account
- Load their person-to-person payments application
How can convenience stores meet self-service needs … without taking up floor space?
Just like consumers are used to one mobile device filled with all of their apps, new technology provides the option to offer one self-service, cash recycling, financial services kiosk with all of the options customers crave. All-in-one financial services kiosks significantly reduce the amount of floor space required for self-service machines while maximizing revenue opportunities. Even better, these machines aren’t limited to debit- and credit-card payments. Their cash recycling capabilities let them dispense and accept cash, as well, freeing up that wall of kiosks without sending cash-based customers to the counter.
Other potential options include partnering with a countertop kiosk provider or leveraging mobile applications.
Using one or more countertop kiosks would quickly free up floor space. However, their compact design doesn’t allow them to deal in cash, only debit, credit and, sometimes, digital payments. For cash transactions, self-service customers may still be able to perform the bulk of their transaction on the kiosk, but final fulfillment would rely on a store employee. The trick is to work with a provider that is capable of hosting a range of applications—or risk taking up a larger chunk of the counter than you’re prepared to hand over.
If countertop kiosks aren’t a possibility, there is always the option to leverage mobile devices. A good mobile loyalty application provider can offer many of the self-service transactions consumers desire. Customers can pre-stage everything through the mobile app and come into the store for in-person fulfillment. Self-service customers will still be forced to interact with an employee. However, pre-staging will make the fulfillment of low-value offerings faster and more convenient.
Conclusion
Self-service kiosks are here to stay. Consumers love them, trust them and consider them more convenient. But retailers simply can’t risk taking up more and more of their floor space to offer yet more self-service kiosk options. Fortunately, there are solutions like countertop kiosks, mobile applications and all-in-one, cash recycling financial services kiosks that are capable of helping convenience-store operators avoid the self-service crunch and keep offering the products their customers have come to expect.
Tony Gaines is chief revenue officer for Cash Depot, Green Bay, Wisconsin.