In-Store Kiosks: The Next Chapter

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Since reopening its doors under new ownership last fall, FAO Schwarz has enticed children and fully grown consumers much the way it always has: with enormous stuffed animals, hard-to-find toys and lots of fun for shoppers.


One addition to the New York City store floor is a Hot Wheels kiosk, where children can design a car, watch a video of "their" car being made and in 10 to 15 minutes be the proud owner of a customized Hot Wheels that comes with a certificate.


Hot Wheels' marketer Mattel said 20,000 customized cars have been sold since the kiosk was introduced a year ago. The company also has seen a positive return on its investment.


Consumer kiosks in the retail environment have been around in one form or another for years. However, only 14 percent of consumers have ever used an in-store kiosk, according to an October report from Forrester Research, "Smarter Stores: Are We There Yet?" This soon could change thanks to the growth of multichannel shopping, which is making consumers comfortable with accessing a brand in a variety of locations -- be it a catalog, a computer or a store.


Forrester predicts that over the next five years kiosks will become more fully integrated into stores and inventory systems so customers looking for an out-of-stock product can locate it at a nearby store or have it shipped from a distant location.


Another benefit, according to Forrester, is that kiosks could become the best way for retailers to identify their customers as they access and change their loyalty program data and find relevant promotions. They can even help provide a personalized experience that is missing from many retail outlets unable to afford the staffing to deliver truly personalized service.


To date, gift registries have been the most successful application of kiosk technology. Kiosks offering a wider merchandise assortment than is available in the store where it is located via the brand's Web site are just now gaining traction, Forrester said.


Eddie Bauer, for example, opened a temporary mini-store this fall in New York City's Rockefeller Center dedicated to its new fashion-oriented down line. Inside the store, there also is a kiosk where shoppers can buy anything from the company's Web site and get free shipping.


Earlier this year, science kit cataloger Edmund Scientific opened four mobile retail units inside New York state malls that showcase 100 best sellers from its catalog. Three of the 150-square-foot units make the company's Web site available for consumers who want to shop the full breadth of products.


The Hot Wheels kiosk is unique because it targets children.


"Kids are a great application. They find [the kiosk] so engaging," said Rob Baumgartner, director of marketing and operations at Planar Systems, which created the Hot Wheels kiosk.


First, a customer chooses a model, type of tires, colors and kind of engine by pressing a graphic representation on the screen. There is no mouse or keyboard. Then he or she enters a name that will appear on the certificate. This is followed by a four-minute animated video showing the car being made, including robots spray-painting it -- "just long enough for a sales clerk to get a car and print out the sales certificate," Baumgartner said.


From Mattel's point of view, the kiosk lets the company charge $20 for a car instead of $5. Plus, Mattel gets more space for its brand and has more control over the message.


"You will continue to see some brands explore this specific way of doing kiosks in store," Baumgartner said.


Chantal Todé covers catalog and retail news and BTB marketing for DM News and DM News.com. To keep up with the latest developments in these areas, subscribe to our daily and weekly e-mail newsletters by visiting www.dmnews.com/newsletters


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