INSIDE: - Hospitality Technology

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INSIDE: • Kiosks Continue to Expand

Applications, Types and Locations

• Budgets Feel the Squeeze; Results Remain Steady

• Increased Mobility Expected to Transform Kiosk Space

• End User Demand Continues to Fuel Growth

Produced by:

A SUPPLEMENT TO RIS NEWS, HOSPITALITY TECHNOLOGY, AND VSR

1K_Cover_v2 11/18/08 3:59 PM

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8 T H A N N U A L K I O S K B E N C H M A R K S T U D Y 3

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4 Executive Summary

6 Case Study: NCR — Delivering Entertainment to the MassesEntertainment/DVD market increasingly driven by self-service options.

8 Section One: Market Snapshot

12 Case Study: ArcaTech Makes Cash Handling SimplerIndustry leader in transaction automation for the financial, retail and self-service industries offers a range of cash and debit solutions.

14 Section Two: Budgets & Results

17 Executive Q&A: Improving Customer SatisfactionPerse Faily, CEO, EMN8, Inc. discusses how restaurant self-service has evolved into an integrated program.

18 Case Study: Taking it to the Next LevelTops Super Foods taps NCR to add cutting-edge self-checkout lanes as part of its remodel project.

19 Section Three: Technologies for Growth

24 Section Four: Kiosks & the Reseller Channel

26 Industry Commentary: Taking HoldTell-tale signs consistently demonstrate that the self-service model is becoming part of the new norm for service delivery.

3K_ToC_v3 11/19/08 5:23 PM Page 3

For this year’s Kiosk Benchmark Study, approximately19,800 email invitations were sent to the readers of

RIS News, Hospitality Technology and Vertical SystemsReseller magazines. The survey response rate was 3%,with 542 respondents answering the online survey.Screening questions on current or planned kiosk instal-lations enabled us to gain information from those withno plans — answering why not, and what previous expe-rience is behind their decisions — and those currentlydeploying or planning self-service, who were then askedto complete the entire survey to gain more detail on thecurrent state of kiosk installations.

The majority of our survey respondents are from retail,hospitality and consumer goods manufacturing. Whenasked for their firm’s primary business activity, 48% selectedRetail, 34% chose Hospitality/Foodservice/Lodging/Travel/Casino, 11% answered Consumer GoodsManufacturing and 7% replied with “Other.” Of thoserespondents with current or planned deployments, weasked which types of kiosks they deployed. POS/Self Check-Out was the biggest, at 37%, followed by CustomerInformation/Point of Information, with 35% of responses.Other important types included Financial Services/ATMwith 26%, HR/Employee Self-Service with 25% and InternetAccess/Web Surfing with 22% of responses.

This year we again asked established kiosk deployersto rate the importance of their kiosk rollout (or planned

4 8 T H A N N U A L K I O S K B E N C H M A R K S T U D Y

Executive Summary

E X E C U T I V E S U M M A R Y

rollout) to their businesses. These numbers were very sim-ilar to last year’s, with 16% selecting “Vital to yourBusiness,” 46% choosing “Very Beneficial to your Business”and 35% selecting “Somewhat Beneficial to your Business.”Just 3% chose “Not Beneficial at All” (just slightly up from1% last year). Little differentiation was shown betweenkiosk budgets for the past 12 months versus projectedannual budgets for the next 12 months

This year’s Hype Cycle Chart from Gartner reveals theextent of visibility and maturity for kiosk applications inall of the major industry sectors. Self-Service Ordering hasmoved past the Peak of Inflated Expectations, but manyother applications have moved just slightly along the chartthis year. New additions include Patient Self-Service,Remote Advice in Banking, and Advanced ATMs, all ofwhich are advancing towards the Plateau of Productivity.

We’d like to thank our Gartner team for their input onthis year’s survey and results. Susan Cournoyer, GartnerManaging VP, Industry Market Strategies, Financial Services,headed up the team, which included Bob Goodwin, GartnerManaging VP, Industry Market Strategies, Small andMidsize Business, and IT Marketing and ChannelsWorldwide; Jeff Roster, Gartner Retail Analyst; and KenBrant, Gartner VP and Manufacturing Research Director.If you have any questions that you would like to seeincluded in next year’s survey and Study, please email themto [email protected]. •

KEY TO INDUSTRY SECTORS

Retail

Hospitality

Consumer Goods

Travel and Tourism

Financial Services

Healthcare

Media, Comm and Entertainment

Government

VIS

IBIL

ITY

Self Service Ordering

Fitness TestingOnline Banking

& Investing

Cell PhonePricing Plans

TechnologyTrigger

3–5 YEARS MATURITY WITHIN 2 YEARS

Peak of InflatedExpectations

E-Voting

ConsumerProduct Information

Remoteadvice in banking

GamingSelf-ServiceCheckout

AdvancedATMs

Gift andWedding Registry

Trough of Disillustionment

Slope of Enlightenment

Plateau of Productivity

TheaterTicketing

HealthcareInformation

Patient Self Service

Citizen Access

Hotel GuestCheck-in

HR Self-Service

Price Checkers

Car RentalReturn

PassengerSelf Check-in

Tourist Information

GARTNER Kiosk Hype Cycle by Vertical Market Solution, 2008–2009

4.K_ExecSum_v2 11/18/08 4:14 PM Page 4

Whether it is the latest action movie on Blu-ray Discor a PlayStation game, on-the-go consumers are increas-ingly seeking convenience when it comes to getting theirentertainment. Businesses are catching on to this con-sumer demand, offering automated DVD kiosks in high-traffic environments such as supermarkets, gas stations,restaurants, airports and more.

Analysts are projecting DVD vending kiosks will growsignificantly over the next three years, increasing to morethan 15,000 by the end of 2008 and more than 22,400 bythe end of 2010.

“What’s more, based on recent developments in theindustry, we believe this growth may be even greater,”says Michele Dundas Macpherson, vice president, NCREntertainment. “Earlier this year, a leading globalprovider of in-home movie and game entertainmentannounced its plans to begin a national pilot program todeploy state-of-the-art NCR self-service entertainmentsolutions, with a goal to have 10,000 vending kiosksinstalled within 18 months. That, coupled with other proj-ects in the industry, takes the projected growth of DVDvending kiosks to more than 45,000 units in the U.S. bythe end of 2010.”

Added Macpherson, “While traditional brick and mor-tar rental stores are transforming themselves into multi-channel providers of entertainment, other retailers arelooking for ways to automate their media departmentsby offering customers faster service and better title selec-tion, as well as the option to buy and trade media.”

As retailers increasingly look to self-service for market-ing movies and other merchandise, NCR is quickly emerg-ing on the forefront of entertainment self-service delivery.

NCR offers a comprehensive entertainment solutionsportfolio backed by industry-leading managed services toboth direct channels, such as retail stores, and independ-ent service organizations, or ISOs, which own and operatekiosks deployed at a variety of venues — an examplebeing TNR Entertainment Corp. under the MovieCubeand The New Release brands. TNR recently selected NCRas its exclusive supplier of self-service technology and


NCR—Delivering Entertainment to the MassesENTERTAINMENT/DVD MARKET INCREASINGLY DRIVEN BY SELF-SERVICE OPTIONS

services, which will bolster TNR’s high availability of itskiosks and help to ensure that the hardware is installedand fully supported across North America, including inremote locations.

“Through NCR, we can bring the kiosks into marketsthat were not previously economically viable for us,” saysTim Belton, CEO of TNR. Belton says his company recog-nized that the way consumers will access entertainment isgoing through “profound changes,” and his companywanted to be ready.

NCR has also entered into an ISO relationship with e-Play, LLC. In addition to renting and selling media, e-Play brings the option of trading used media on DVDsto the market. This innovative technology presentsadded revenue opportunities for retailers and otherbusinesses. To date, the technology has already beendeployed with a national retail chain operating inGeorgia, North Carolina and Ohio.

“Our collaboration withNCR will greatly enhance e-Play’s plans for growth asan ISO in the kiosk mar-ketplace,” said e-Play Co-Founder and CEO AlanRudy. “Together we canprovide businesses withmore innovative choices inthe ways they deliver digitalmedia to consumers.”

For retailers, the eco-nomics of self-service areequally compelling. GregBuzek, president of IHLConsulting Group, seesentertainment kiosks grow-ing in popularity. “As gasprices go up and people cutback, they still want theirentertainment. Those typesof kiosks are great options.”

A D V E R T I S E M E N T

By Jolanta Moss, Industry Marketing Director, NCR Entertainment

6-7.K_NCR_CS.qxp 11/20/08 11:06 AM Page 6


Belton notes that increasingly TNR is looking to bringthe “magic of movies” into everyday consumer activitieslike grocery shopping and venues of mass transit.

“The consumer is increasingly motivated by price andconvenience. When it costs $60 to take a couple of kidsout to a movie, gas is expensive and the movie theatermay be charging you for parking, the expense of going tothe theater is no longer a trivial part of a householdbudget,” Belton explains.

NCR is seeing strong interest in its kiosk offerings notonly among U.S. retailers but also globally — particularlyin Japan, where retailers are embracing self-service inresponse to a maturing workforce and a general lack ofavailable labor. Europe, already a strong consumer ofkiosk-based DVDs, also holds promise.

A Product Line Poised for the FutureThe NCR SelfServ Entertainment portfolio includes a mul-tichannel software platform and a wide range of DVDvending and digital download kiosk options.

The launch and initial offering of NCR SelfServEntertainment featured the NCR SelfServ EntertainmentRent/Sell kiosk. The Rent/Sell kiosk provides the capabilityfor DVD rental, sale of used and new shrink-wrappedmedia or a combination of the two at nearly twice thecapacity of competing units. The system’s sleeve dispens-ing system uses innovative radio frequency identificationtechnology, allowing NCR to uniquely and efficientlyidentify each unit of inventory.

NCR further expanded its entertainment self-servicetechnology portfolio with the addition of a Multi-Function kiosk that allows consumers to trade in their oldmedia in addition to renting and purchasing. Through aunique bare-disc handling technology, this new optionalso improves consumer access to merchandise as theMulti-Function kiosk can hold more than four times thenumber of discs as the Rent/Sell kiosk. In addition, cus-tomers will also be able to check discs for quality.

NCR backs its entertainment portfolio with the type ofcomprehensive services and warranties that smaller com-panies simply cannot match. Even more significant isNCR’s back-end networking expertise —that can translateto a one-stop solution for retailers looking to maximizerevenue opportunities in entertainment self-service.

According to Macpherson, digital downloading ofentertainment content is “inevitable,” which is why NCRhas a well-defined digital download strategy at the kiosklevel. “This is different than traditional Internet down-

loads in that the encrypted digital content will be storedon a dedicated server at the kiosk, and you can plug adevice in and download the material,” she explains.

Key factors for mainstream adoption of video ondemand include the need for the industry to adopt a com-mon standard for storing and transmitting entertainmentcontent, as well improvements in storage and downloadefficiency — to make the consumer experience as robustas what people get from the disc today.

NCR is moving closer to that goal through its agree-ment to make a minority investment in MOD Systems, aleading provider of digital media delivery systems forretailers. This investment is part of a strategic initiativeamong NCR, MOD and Toshiba Corporation to offerconsumers one of the fastest, most convenient ways toaccess high-quality digital entertainment. The initiativeprovides the ability to download digital content to SDmemory cards and portable devices such as mobilephones through kiosks and other self-service devicesdeployed by NCR and integrated with the MOD plat-form at a variety of outlets. Using this technology, con-sumers will be able to download full-length films witha speed similar to music downloads. The MOD RetailEnterprise System for “multichannel” digital mediadelivery enables the digital content to be managed anddistributed securely. Video entertainment content willbe provided by major and independent studios, whichwill provide approximately 4,000 titles at the launch ofthe service.

How Will Entertainment Self-Service Evolve?While most industry insiders cannot predict preciselywhen digital will surpass the disc as the preferred vehiclefor getting home entertainment, players are taking stepsnow to be ready for that future.

In the nearer term, kiosk operators remain stronglycommitted to the disc-based segment — a segment that isgrowing by more than six times the rate of the digitaldownload market.

Industry analysts believe that digital distributioncould eventually become mainstream; however, it willlikely be in addition to, rather than a replacement of,physical media.

Clearly, consumers and retailers have much to gainfrom the convergence of entertainment with self-servicetechnology. Forward-thinking retailers investing in the lat-est entertainment self-service platforms stand to enhanceboth their brand perception and their bottom line. •

6-7.K_NCR_CS.qxp 11/20/08 11:18 AM Page 7

This year’s economic troubles have impacted the kioskindustry by slightly slowing the rate of new and

planned deployments in retail, hospitality and consumergoods. Of this year’s survey respondents, 23% have alreadyinstalled kiosks, 4% are in the process of installing and12% are planning to install kiosks within the next 24months. 56% have no plans to install, up from 49% in 2007.

As in previous years, we asked those respondents withno plans for kiosks for their reasons for disinterest or delay.Garnering 31% each, the top three reasons were “Neededapplication does not exist,” “Can’t justify expense (lowROI)” and “Other.” The range of kiosk and self-service appli-cations continues to grow year on year as more needs arediscovered and met for businesses, yet this first reasonremains important to our respondents. This could repre-sent an opportunity for the kiosk industry to discover andaddress the application requirements that are going unmetfor prospective buyers. Further research and industry infor-mation sharing are needed to explore this issue further.

The low ROI objection to kiosks is gradually becomingameliorated by their proven ability to save on operatingcosts like staffing and training, and to improve customerservice and enhance repeat business. Under “Other,”respondents added notes, including: “Added technologyneeded,” “Brand still testing,” “Not brand appropriate,”“Does not fit merchandising strategy,” “Not relevant tobusiness,” “Weak business case” and “We have a businesscenter.” Many of these responses reflect the concerns oflodging and food service, where kiosks are still consideredinappropriate to more high-end brands, where guests expectmore personal attention. These businesses may turn to self-service to offer a speedier alternative at check-in, particu-larly for frequent travelers who have become accustomedto self-check in and not waiting in line at airports.

Vertical MarketsThe majority of our survey respondents come from retail,hospitality and consumer goods manufacturing, reflect-ing our subscriber base that provides the emails forthe survey invitations. When asked for their firm’s pri-mary business activity, 48% selected Retail, 34% choseHospitality/Foodservice/Lodging/Travel/Casino, 11%


Market SnapshotK I O S K S C O N T I N U E T O E X PA N D A P P L I C AT I O N S , T Y P E S A N D L O C AT I O N S

S E C T I O N O N E

State of Deployment

TOTAL

In the Process of Installing 4%

Already Installed 23%

Planning to Install Within 12 Months 7%

Planning to Install in 24 Months or More 4%

Planning to Install Within 24 Months 5%

11%

53%

20%

8%

3% 3%1%

1-10

11-50

51-100

101-500

501-1,000

1,001-2,499

Over 2,500

Future PlanningHow Many new kiosks do you plan to deploy in the next 12-18 months?

8-11.K_MarketSnap_v2 11/18/08 4:16 PM Page 8

answered Consumer Goods Manufacturing and 7% repliedwith “Other.” Notes added by respondents selecting Otherincluded Event Center, Drug Store Chain, Gaming, Healthcare, Historical Museum, Military Textile Manufacturing,Pharmaceutical Discovery, Manufacturing and Sales, andTheme Parks — Guest Arrival/Ticketing. These all reflectthe growing reach of kiosk and self-service applicationsinto new and relatively new markets.

Gartner’s Retail Analyst Jeff Roster has been watch-ing the development of Self-Service for several years.“Retailers are looking for self-service strategies. GenerationY, and the Millennium Generation are very comfortablewith technology. They are retailers’ present and futurecustomer base. We’ve all seen kids ‘texting’ next to eachother on the playground; they are very ready for self-serv-ice,” Roster explains. “Customer-centric strategies includetouchpoints for self-service, and are important consider-ations for when a retailer retools its store. Best Buy is agreat example, as they’ve taken their loyalty program andWeb site and tied them into the in-store experience viakiosks.” One of the best new retail applications Roster has

found recently is a kiosk in the Returns environment,where there is a fair amount of information gatheringand highly repeatable tasks that are well-suited to self-service. He expects to see more kiosks in department andconvenience stores, which have smaller staffing footprintsthat could be bolstered by deploying self-service.

Of those respondents with current or planned deploy-ments, we asked which types of kiosks they deployed.


Needed Application Does Not Exist 31%

Kiosks are Impersonal and Reduce Level of Customer Service

18%

Kiosk Projects Have Failed in the Past 6%

Can’t Justify Expense (low ROI) 31%

No Budget 13%

No Executive Support 19%

Other (please explain) 31%

Reasons Against DeploymentExplain your decision not to utilize kiosks.

The low ROI objection to kiosks is

gradually becoming ameliorated by

their proven ability to save on operating

costs, like staffing and training, and

to improve customer service.


POS/Self Check-Out was the most numerous, at 37%, fol-lowed by Customer Information/Point of Information,with 35% of responses. Other important types includedFinancial Services/ATM with 26%, HR/Employee Self-Servicewith 25%, and Internet Access/Web Surfing with 22% ofresponses. “Other” responses expanded the selection toinclude Custom Orders, Custom Orthotics, Deli Orderingand Recipes, Loyalty Program/Promotional Programs,Product Review, Reserving Services, Retail Food Kiosk,Sports License Products and Will Call/Ticketing. Multipleresponses were permitted for this question, and Hotel SelfCheck-in/out was included under POS/Self Check-Out.

We also asked how many kiosks each of these respon-dents had deployed. As in previous years, the numbers arehigher at the lower end, with 40% deploying 1-10 kiosks,and 24% deploying 11-50. Toward the higher end, 13%of our respondents have deployed 101-500 kiosks, and10% have more than 2,500 (the same percentage as last

year) installed. As for new deployments planned in thenext 12-18 months, 53% plan to install 1-10 kiosks, and20% plan 11-50. 11% plan to deploy 51-100 kiosks, andabove that number the percentages fall into the singledigits (as shown on the accompanying chart on page 8).


Convention Centers/Arenas 4%

Inside Manufacturing Facilities 7%

Inside Warehouse/Logistics Facilities

7%

Inside Business Offices 7%

With our Logistics Vendors 1%

Other 3%

Inside Store/Restaurant/Hotel, etc.(for customer use) 78%

Inside Store/Restaurant/Hotel, etc.(for employee self-service or job recruitment) 25%

Convenience Stores 3%

Outside Store/Restaurant/Hotel, etc.

7%

Malls 6%

Mass Merchandisers 5%

Kiosk DeploymentNote the location in which your current or new kiosks will be deployed.

Location remains a challenge,

despite the relative freedom

enabled by wireless Internet

access; the best solution combines

flexibility and careful planning.

Market Snapshot


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Location, Location, LocationAny kiosk installation is only as success-ful as its location allows it to be. Aftertheir early years, when kiosks wereknown as “those things that neverwork,” most of the technological hur-dles such as robustness, remote man-agement and automatic reboots havebeen overcome today. Location remainsa challenge, despite the relative free-dom enabled by wireless Internet access.The best solution combines flexibilityand careful planning. Pilot phases shouldexperiment with different locations tomaximize foot traffic and customerusage. However, the most traffickedareas are often too busy to enable cus-tomers to comfortably utilize a kiosk.Trial and error works best, even compar-ing different times of day to see whatadjustments need to be made.

Of this year’s survey respondents, 78%place their kiosks Inside Store/Restaurant/Hotel, etc. for customer use. This remainsthe safest and most reliable location forunattended self-service devices. Someinroads have been made into outdoorlocations through weatherproof kioskenclosures and connectivity, but indoorsremains the current best venue. 25% ofour respondents place their kiosks InsideStore/Restaurant/Hotel, etc. for employeeself-service or job recruitment. This is apopular application for employees with-out their own desks or computers toaccess corporate and Human Resourcesinformation. Job recruitment has madegreat strides, with major retailers suchas Target and Home Depot reaching outto their customer base through kiosks,while back-office managers can screenapplications in real time to determinewhether to initiate an interview beforethe applicant leaves the store. Manyrestaurants also use job recruitmentkiosks to lure employees and to do on-site screening of applications. HumanResources applications such as payrolland tax information can be added to

these employee profiles once they’ve been hired. As shown on the accompa-nying chart, the remaining locations garnered responses in the single digits.Responses given under “Other” included Airports, Hospitals, College Campuses,Job Sites, Sales Centers and With Reps. Clearly, location is an aspect that is setto grow alongside new applications in Self-Service. •

8-11.K_MarketSnap_v2 11/18/08 9:58 AM Page 11

Despite the popularity of checks, debit and cred-it cards, the majority of consumers still use cash to somedegree. Actually, the amount of cash in circulationtoday is increasing.

Given cash’s strong presence in the marketplace, con-sumers expect the opportunity to use banknotes andcoins in nearly every situation. To improve cash-basedtransactions, retailers are deploying kiosks — both onsales floors and in backrooms — to make cash handlingsimpler, safer and more efficient.

Self-Checkout Customized forSmall FootprintWhen a Fortune 500 company sought todevelop a new grocery self-checkoutkiosk, it turned to ArcaTech for a custom-designed cash dispenser.

The manufacturer’s decision toaccommodate cash payments was anobvious one, given the large number ofcash transactions in grocery stores. Bothdeployer and consumer appreciate theease and cost of cash transactions: low-cost for thedeployer and fast, free and convenient for the consumer.Unlike credit/debit cards, electronic check or ACH transac-tions, cash transactions are settled immediately, evenwhen a system is offline.

While the manufacturer needed to include cash capabil-ities in its system, it also needed to make it more compact.Because space is at a premium in any retail facility, retailersdemand the smallest kiosks possible. The manufacturerworked with ArcaTech, which responded with an elegantsolution. By modifying the design of a unit with a remark-ably small footprint, ArcaTech reduced the width of thecash dispenser by more than six inches.

Top Parking Company Trims Costs withUnattended Payment SolutionTogether with a large parking company, ArcaTechworked to provide the right cash handling equipmentfor a parking payment kiosk.

These kiosks replace live attendants at facility exits,reading parking cards and assessing fees. While theyaccept credit and debit cards, they frequently take incash from people paying for parking.


ArcaTech Makes Cash Handling Simpler

When a company eliminates traditional payment pro-cedures in favor of a kiosk, the self-service device shouldsupport every type of transaction available through thecompany’s previous model. Consumers expect consistentoptions, regardless of the transaction medium and willlikely react negatively to limitations. The success of a self-service device, such as a parking payment kiosk, dependson delivering a more efficient and better service than wasavailable through the traditional method.

For this reason, the parking companyplaced a strong emphasis on cash accept-ance, commissioning industry-leaderArcaTech to supply a reliable, easy-to-usecash-dispensing component.

Food-Service Company at MajorAirport Chooses Backroom CashAutomation SystemKiosks aren’t only for consumer endusers. More retailers are installing back-room systems for internal cash manage-ment as well.

This was the case for a food-service company at one ofthe country’s busiest airports. The organization, whichmanages multiple restaurants in one terminal, controls itsentire operation through a single cash office, powered byArcaTech’s cash control system — a cash and coin recyclerthat automatically dispenses and reconciles cashier tillsand handles currency exchanges throughout the day.

Combining its expertise in banking automation withits experience in kiosks, ArcaTech designed a solutionthat limits cash touch points, reducing risk, discrepan-cies and the time required for till creation and reconcil-iation. As a result, the food-service company hasreduced the risk associated with cash and achievedgreater efficiency as cashiers and managers are freedfrom creating and counting individual tills.

Cash Made SimplerKiosks, in short, can simplify cash management. Whetherused in a grocery store, parking deck or retail backroom,a smartly designed kiosk accommodates users while sav-ing deployers time and money. By partnering with expertslike ArcaTech, kiosk manufacturers and users around thecountry are realizing greater savings and efficiency. •


12.K_ArcaTech_CS.qxp 11/20/08 10:18 AM Page 14

Budgetary concerns are slowing the rate of new andexpanding kiosk deployments. Bob Goodwin,

Managing Vice President, Industry Market StrategiesWorldwide for Gartner, Inc., remains bullish about thelong-term success of kiosks, particularly for further expan-sion into hospitality markets. “Without the current eco-nomic downturn, I would have forecast a steady straight-lineadoption rate by hospitality. Hotels are not as vulnerableas airlines to economic downturns, though occupancy ratesand revenue per available room could go down or ‘flat-line’,” he explains. “For IT investments, their motivationsare to reduce labor costs and increase guest convenience

through self-service check in/out and automated concierge-type information. But that’s still not as important as Profitand Loss. I see adoption interrupted for a year, where itwill be flat and muddle through, and then it will continue.Given the upsides of technical advances, smaller footprints,greater functionality and ease of use, long term I am bull-ish about self-service.” Goodwin’s only concern is for theincreasingly raised bar on ROI (Return on Investment) interms of enhanced operational efficiencies and reducedcosts for new deployments.

Reaching ROIThis all-important issue of ROI is having a clear impact onthis year’s survey respondents and their businesses. Weasked those respondents with no current plans for kioskswhat their experience had been with previous kiosk proj-


Budgets & ResultsB U D G E T S A R E F E E L I N G T H E S Q U E E Z E , B U T R E S U LT S R E M A I N S T E A D Y

S E C T I O N T W O

ects. After “Low Usage,” selected by 49% of respondentsin this category (and down from 53% last year),“Unacceptable ROI” came in second, with 45% of responses,nearly twice last year’s percentage of 24% for the sameissue. Clearly, new IT investments need more than a “wingand a prayer” to get approval in today’s economic climate.

Among those respondents with current kiosk installa-tions in place, we asked for the length of their implemen-tation from Testing through to Full Deployment. Thetiming has slowed this year, with just 23% deploying withinsix months (down from 31% last year), and 38% within6-12 months (up from 29% last year). There is a clear rea-son why they call this an “economic slowdown.” Oncethings get back to normal, kiosk installations should pickup the pace again.

17%

30%

16%

17%

20%

Under $25,000

$25,000-$49,000

$50,000-$99,000

$100,000-$249,000

More than $250,000

Kiosk BudgetsWhat is your approximate annual budget for kiosks in the next 12 months?

Interestingly, not much

differentiation was shown between

kiosk budgets for the past 12

months versus projected annual

budgets for the next 12 months.

14-16.K_Budgets_v2 11/18/08 4:18 PM Page 14

Sound Attract Loops 10% 16% 19% 23% 32%

This year we again asked established kiosk deployers torate the importance of their kiosk rollout (or planned roll-out) to their businesses. These numbers were very similar tolast year’s, with 16% selecting “Vital to your Business,” 46%choosing Very Beneficial to your Business” and 35% select-ing “Somewhat Beneficial to your Business.” Just 3% chose“Not Beneficial at All” (just slightly up from 1% last year).

Interestingly, not much differentiation was shownbetween kiosk budgets for the past 12 months versus pro-jected annual budgets for the next 12 months. As the chartindicates, the majority of kiosk budgets for hardware,software, services and support still fall below $25,000 peryear, garnering 30% of this year’s respondents (but downfrom 40% last year). At the top end, 20% of respondentsreported having planned budgets of more than $250,000for the coming year, up from just 15% last year. However,these numbers may have had to be readjusted now, sincethe survey was administered in July and August of thisyear, prior to the current economic downturn.

Balancing BudgetsRegarding budget allocations, hardware is still the mostexpensive, comprising 42% of kiosk budgets, followed bysoftware with 24%. Networking, Professional Services,Hardware and Software Maintenance Support and RemoteMonitoring and Internal Services all fell into the low dou-ble digits, ranging from 11-14% of total kiosk budgets. Asfor whose department is footing the bill, MIS/IS/Plant/Facilitiesdepartments still fund 57% of kiosk projects, following byStore Operations with 38%, Sales, Corporate, General/


Regarding budget allocation,

hardware is still the most expensive,

comprising 42% of kiosk budgets.

Customer Encouragement

EXTREMELY IMPORTANT SOMEWHAT NOT TOO NOT AT ALLIMPORTANT IMPORTANT IMPORTANT IMPORTANT

Advertising 18% 39% 24% 8% 11%

Active Staff Promotion 31% 29% 17% 9% 14%

Discounts/ Bonus Offers 19% 27% 24% 8% 22%Coupon Printing

In-Store Signage 23% 37% 21% 8% 11%

Exclusive Services on Kiosks 28% 29% 13% 10% 20%

On-Screen Graphics 26% 36% 22% 9% 7%

Prominent Location 47% 37% 9% 3% 5%

Proximity Sensors 10% 15% 16% 20% 39%

Please rate the importance of how each of the following factors encourages, or will encourage, use of your customer-facing kiosks.

14-16.K_Budgets_v2 11/18/08 10:02 AM Page 15

Administrative with 26% and Marketing/Promotion with23% funding self-service projects.

As in previous years, we asked our respondents withcurrent or planned kiosk projects to rate the importanceof various factors in encouraging the use of their customer-facing kiosks. Here previous trends continue, withProminent Location rated as “Extremely Important” or“Important” by 84% of our respondents, followed byAdvertising, with 63% of respondents rating it as either“Important” or “Somewhat Important.” Other importantfactors rated as either “Extremely Important” or“Important” by our respondents included OnscreenGraphics with 62%, Active Staff Promotion and In-StoreSignage, both with 60%, and Exclusive Services on Kiosks,with 57%. Proximity Sensors and Sound Attract Loops havefallen still further from favor, with 39% and 32%, respec-tively, rating them as “Not at all Important.” These wereearly tools for gaining customer attention, but have beenfound too irritating by staff and customers alike to survivelong in the marketplace. Deployers have since learned thatthe goal is to attract customers rather than startle them.

Revenue opportunities for kiosks continue to developas a means to bolster ROI. When asked to rate their rev-enue opportunities, 72% of respondents selected“Extremely Important” or “Important for Marketing/Promotion,” followed by Increased Product Sales with 69%,Advertising with 68%, and Upselling with 67%, all choos-ing those two highest levels of importance. Surprisingly,Reduced Lines got just 51% at those two levels. Two rela-tively new revenue opportunities were Drawing New

Customers and Overcoming Language Barriers, with 50%and 39% rating them at the highest two levels, respec-tively. Pay-Per-Use and Selling Ad Space drew just 15% and28% of respondents to these two levels of importance.

One of the most important decisions is selecting a kiosksolutions vendor for your installation. Technical expert-ise drew 90% of respondents to select either “ExtremelyImportant” or “Important,” followed by Cost/Price andKiosk Expertise with 89% each, and Industry Expertisewith 84% selecting the top two levels of importance.Reputation and Track Record/References each drew 83%of respondents to the top two levels. Interestingly, UsedVendor in the Past drew just 57% of respondents to rateit in the top two levels of importance. This indicates thatSelf-Service has become much more specialized since theearly days, when buyers turned to their regular IT ven-dor when considering a kiosk installation. •


Self-Service has become much

more specialized since the early

days, when buyers turned to their

regular IT vendor when considering

a kiosk installation.

Kiosk Vendor Selection

EXTREMELY IMPORTANT SOMEWHAT NOT TOO NOT AT ALLIMPORTANT IMPORTANT IMPORTANT IMPORTANT

Industry Expertise 39% 45% 11% 2% 3%

Cost/Price 42% 47% 10% 1% 0%

Kiosk Expertise 51% 38% 7% 2% 2%

Track Record/References 36% 47% 13% 2% 3%

Reputation 41% 42% 13% 2% 3%

Technical Expertise 44% 46% 6% 2% 2%

Used Vendor in the Past 22% 35% 23% 11% 9%

Please rate the level of importance when it comes to selecting your kiosk solutions vendor.

Budgets & Results

14-16.K_Budgets_v2 11/18/08 10:02 AM Page 16


Q: How have self-service solutions for restau-rants evolved in the last few years?Perse Faily: Restaurant self-service has evolved into anintegrated program, involving operations, marketingand IT, which redefines how service is delivered to thecustomer, and drives to improvements in guest satisfac-tion, loyalty, revenue, and operating margins. The focusof many operators has evolved from cashier replace-ment to labor redeployment and aggressively drivingsales per labor hour. The number of self-service pilots isgrowing, and a number of pilots have evolved intobroader initiatives. Given the positive results of thesepilots and the market and economic challenges facingrestaurant operators, we believe that self-service inrestaurants is at a tipping point.

Q: What are some of the main benefits of self-service technologies as they relate to therestaurant/hospitality area?Faily: Self-service delivers improved guest satisfactionand increased net margins for operators that deploy andfully operationalize the technology. This is critical in anincreasingly competitive landscape and challenging eco-nomic environment. Our customers are first and foremostfocused on satisfying their guests. Self-service delivers andimproves guest satisfaction by providing an order andpayment method that is convenient and easy-to-use, pro-vides visibility as to full menu choice, allows guest cus-tomization or orders, and improves order accuracy. Ourcustomers are also focused on improving profit margins.Self-service delivers on margin improvement by liftingaverage check, increasing sales 15 to 30 percent throughthe use of image-based menus and suggestive selling onevery order, and improving operational efficiencies.

Q: When it comes to self-service technologies,what are end users in the hospitality/restau-rant vertical specifically looking for?Faily: Operators want a robust end-to-end self-servicesolution that represents their brand in a rich graphicsmenu that is intuitive for the consumer to use. In many

Improving Customer SatisfactionPERSE FAILY, CEO OF EMN8 PROVIDES HER THOUGHTS ON HOW SELF-SERVICESOLUTIONS WITHIN THE HOSPITALITY/RESTAURANT VERTICAL HAVE EVOLVEDOVER THE LAST FEW YEARS.

segments of the restaurant industry, cash remains king. Assuch, operators want a self-service solution that supportsall payment types — cash and credit — and meets opera-tors’ high standards for availability, reliability and ease ofmaintenance. Operators also want a solution that is con-structed with their operational realities in mind and asolutions provider that delivers and supports the totalsolution. This means a solution provider that integratesthe restaurant-specific branding and menu componentswith software and hardware and delivers a platform thatis designed to be maintained and managed both in smalland large deployments.

Q: How does EMN8 continue to maintain its lead-ership position in the integrated restaurant self-service solution market?Faily: Our mission at EMN8 is to deliver a compellingguest experience, improved guest satisfaction andincreased profit margins for our customers. We investheavily in understanding the drivers of consumer adop-tion of self-service and being attuned to the short termand long term business objectives of our customers. Whatwe learn from this investment therefore drives our prod-uct development and service delivery. Self-service must beintegrated with other in-restaurant technologies andoperational processes. We ensure that, both directly andthrough our business partners and resellers, we deliver anend-to-end solution to the operator that meets the collec-tive needs of Operations, Marketing and IT.

Q: How does EMN8 plan to work with its respec-tive reseller partners to effectively deliver itssolution?Faily: Resellers are an important component of EMN8’ssales and solution delivery strategy. Resellers provideimportant services related to in-store technologies, such ashardware, point-of-sale applications and related databas-es, to operators. Our resellers offer both our self-servicetechnologies and maintain these solutions for our jointcustomers. This enables our customers to have a singleprovider of in-store services. •


17.K_EMN8_CS.qxp 11/20/08 10:19 AM Page 17

When Tops Super Foods, a family-owned grocerystore located in the historic Gold Rush town ofWeaverville, Calif., decided to upgrade its checkout sta-tions as part of a store remodel, they chose to take theirin-store technology to the next level.

Established in 1961, Tops Super Foods is owned byDean Ryan and his brothers, and is managed by Dean’swife, Renie. As a long-time customer of NCR, the Ryansdecided to work with John Creamer, president of SNCRCalifornia, an NCR reseller, to add four NCR SelfServ™Checkout self-checkout lanes, and upgrade five employ-ee-manned stations with the NCR RealPOS™ 80XRT point-of-sale (POS) solution.

Most shoppers may not expect to find this type ofadvanced technology in a small grocery store. However,according to Creamer, Dean was quick to consider self-checkout technology as a way to better serve his cus-tomers. “Many of the big chains have enjoyed the bene-fits of self-checkout for some time,” said Creamer.“Consumers are increasingly drawn to grocers that pro-vide self-checkout for added convenience, and Dean feltit was something he wanted to offer to his customers.”

Tops’ Weaverville location is known as a tourist spot,with many visitors coming during the summer from theurban San Francisco Bay area. Because self-checkout tech-nology is something most tourists are already accustomedto, shopping at Tops allows them to enjoy the “comfortsof home” while on vacation. “Self-checkout is convenientfor vacationers, as well as our regular customers, whocome in and want to purchase a few items; they don’thave to wait in line behind someone with a cart full ofgroceries,” said Renie.

When Tops’ employees were told that self-checkoutlanes were being added, some were initially concernedthat jobs would be cut. But the Ryans assured them thatthe self-checkout lanes were designed to help boostemployee productivity, rather than cut their work force.“Many employees were afraid they would be out of ajob,” Creamer said. “But that didn’t happen. Instead theywere trained to help customers who were new to self-checkout, and Tops always has one attendant on duty tomanage the self-checkout lanes.”


Taking it to the Next LevelTOPS SUPER FOODS TAPS NCR TO ADD CUTTING-EDGE SELF-CHECKOUT LANESAS PART OF ITS REMODEL PROJECT

Renie added, “There are some shoppers that are hes-itant at first, however most are receptive simply becauseof the convenience. Someone new comes in every daythat has not used this technology before, and it is so niceto have an employee there to offer a demonstration,especially during busy times when there are long linesand they only have a few items.”

The Ryans, with Creamer’s guidance, also chose theNCR RealPOS 80XRT POS solution because of its speed andaccuracy. Flexibility was also key. The NCR RealPOS 80XRTallows the Ryans to easily add on peripherals, such asprinters and display units, without adding any additionaldata ports. “Dean didn’t need to add multiple powerports,” Creamer said. “Everything conveniently runs offone data cable.”

According to Renie, when the Ryans first consideredan upgrade to their checkout technology, they analyzedseveral systems. But it was the NCR family of productsthat stood out. Their past experiences with SNCR andthe responsive attention from Creamer and his staffwere also major factors. “We really felt the NCR prod-ucts were the way to go with this upgrade,” Renie said.“We’ve always had a good experience with their POSsolutions, and wanted to stay with NCR and SNCR. Weare in a remote area, and even though SNCR is locatedabout four hours away, John Creamer and his teamhave always been great about getting to us in timeswhen we needed them the most.” •


18.K_NCR_CS.qxp 11/20/08 10:21 AM Page 14


As shown on the chart, there are certain technologiesthat remain the backbone of most kiosk installations.

Touch screens were selected as being “Extremely Important”or “Important” by 77% of our respondents with currentor planned self-service deployments. Next in importancewas Internet Connection, given those two highest levelsof importance by 65% of our respondents. To many con-sumers, a touch screen is the most identifying and neces-sary feature of a kiosk, providing a convenient and nowfamiliar interface with which to access services, goods, orinformation. An Internet connection is now nearly an imper-ative for standalone self-service devices to enable contentupdates, inventory information, remote monitoring anddiagnostics (including automatic reboots), credit card pro-cessing and ecommerce transactions. Printers were ratedin the two highest categories by 60% of our survey respon-dents, indicating that they remain an important featurefor kiosks, particularly for consumers to take away infor-mation, maps, coupons, tickets, etc. In the past decade,printers have become much more robust and able to han-dle the abuses that often emerge with unattended devicesin the public sphere—hence their continued importanceamong kiosk technologies.

Revolutionary ChangesLED Displays, Video and Keyboards also ranked highlywith our respondents, showing the importance of newand old technologies in this area, followed by Credit CardReaders, Remote Management Software and WirelessCommunications. Wireless is a key technology for growth,and will soon enable interaction with customers’ own wire-less devices, both on and off property. Gartner’s Jeff Rostersees this emerging “in the next 18 months or so. Wirelessline busters and other devices will evolve to include con-sumers’ own wireless devices. They’ll enable access to inven-tory and become a shopping portal, providing cost savingsfor retailers and pleasing customers because they are morecomfortable using their own devices. That is revolutionary.”

Bob Goodwin of Gartner also sees kiosks duplicatingmany home PC and Blackberry functions, particularly ina hotel setting: “In the future, we’ll see a very high level

Technologies for GrowthI N C R E A S E D M O B I L I T Y A N D F U N C T I O N A L I T Y W I L L E V E N T U A L LY T R A N S F O R M T H E K I O S K S PAC E

of adoption, mobility, networking and functionality. Kioskswill continue to reduce in footprint size. Ten years fromnow, we probably wouldn’t recognize it as a kiosk.” Othernew technologies gaining in prominence include Scanners,Plasma Displays and Smart Card Readers, as indicated byour survey respondents.

Another emerging technology for kiosks is biometrics.The majority of our respondents do not currently use bio-metrics for their kiosks. Just 16% use Thumb/Finger/Handprint recognition, 8% use Signature recognition and2% use Iris recognition. As shown on the chart, 38% ofour respondents believe that Signature Recognition —the longest established biometric overall — would be use-ful for their kiosks, followed by 34% selecting Thumb/Finger/Handprint Recognition and 17% for Voice recog-

nition. The biometrics perceived by the public as beingmore “invasive” —Iris Recognition and Facial Recognition— scored significantly lower, as every kiosk deployer wantsto make their self-service devices as approachable aspossible for the general public.

Increasing ReliabilityEven the most established technologies will still be vul-nerable to occasional failure, but kiosk technologies havebecome significantly more robust and reliable over thepast decade. According to this year’s respondents, theaspects that “Almost Never” cause kiosk failure areCash/Coin Acceptor failure with 59%, Scanner failure with52%, Vandalism with 50% and Card Reader failure with

S E C T I O N T H R E E

Wireless is a key technology for growth,

and will soon enable interaction with

customers’ own wireless devices,

both on and off property.

19.20.22.23.K_TechGrowth_v3 11/18/08 10:12 AM Page 19


Important Technologies Please rate the importance of the following technologies to your kiosk solution.

VERY IMPORTANT SOMEWHAT NOT TOO NOT AT ALLIMPORTANT IMPORTANT IMPORTANT IMPORTANT

Biometrics 5% 15% 18% 20% 43%

Audio/Sound Attract Loops 13% 23% 28% 16% 20%

Check Acceptors 6% 8% 8% 15% 63%

Credit Card Readers 36% 13% 8% 7% 37%

Coin/Cash Acceptors 13% 13% 10% 12% 53%

Internet Connection 41% 24% 12% 8% 15%

Keyboards 27% 24% 13% 16% 20%

LED Displays 22% 31% 12% 13% 23%

Technologies for Growth

Photo/Imaging Scanners 11% 17% 10% 16% 47%

Plasma Displays 17% 17% 18% 13% 35%

Proximity Detectors 6% 10% 18% 18% 49%

Printers 23% 37% 18% 4% 18%

RFID 8% 7% 15% 20% 50%

Scanners 13% 23% 14% 15% 36%

Remote Management 18% 29% 23% 12% 18%Software

Signature Capture 16% 15% 12% 13% 44%

Smart Card Readers 14% 18% 12% 11% 45%

Touchscreens 45% 32% 9% 6% 8%

Video 24% 29% 16% 11% 20%

Wireless Communications 24% 23% 18% 7% 29%

Other 6% 3% 6% 3% 81%


self-service technology without succumbing to the temp-tations of harming unattended public devices.

Kiosks are still not critical to business operations, accord-ing to our survey respondents. 35% cite a slight impacton their operations if a kiosk failure occurs, followed by33% with a moderate impact and 21% with a strongimpact. These numbers represent a slight increase overlast year’s survey, perhaps indicating a growing impor-tance for kiosks in the sphere of business operations.

Ken Brant, Gartner Vice President and ManufacturingResearch Director, sees kiosk technologies competing withmore established systems in the consumer goods manufac-turing space: “While the survey respondents rate ‘manufac-turing production/processing information’ as the most


Iris (eye) Recognition 12%

Facial Recognition 7%

Thumb/Finger/Hand print recognition 34%

Voice Recognition 17%

Signature Recognition 38%

None 10%

Biometric ApplicationsWhich of the following biometric application do you use for your kiosk(s)? (select all that apply)

Technologies for Growth

Severe impact 4%

Strong impact 21%

Moderate impact 33%

Slight impact 35%

No impact 7%

Impact of Kiosk FailureWhat impact does a kiosk failure make on your operations?

The public appears to have accepted

self-service technology without

succumbing to the temptations of

harming unattended public devices.

44%. Interestingly, Vandalism has not emerged as a majorcause of kiosk failure in the eight years that we have beenconducting this Study. The public appears to have accepted

19.20.22.23.K_TechGrowth_v3 11/18/08 4:20 PM Page 22


Causes of Kiosk Failure Please indicate how frequently each of the following events cause kiosk failure.

VERY FREQUENTLY SOMEWHAT INFREQUENTLY ALMOSTFREQUENTLY FREQUENTLY NEVER

Cash/Coin Acceptor failure 2% 5% 11% 23% 59%

Card Reader Failure 3% 7% 21% 26% 44%

Display failure 3% 8% 19% 40% 31%

Internet Failure 2% 12% 22% 32% 33%

Harsh Operating 4% 11% 18% 34% 34%Environment

Keyboard Failure 2% 5% 16% 38% 40%

Poor Maintenance 3% 9% 16% 42% 29%

Power Failure 2% 4% 15% 48% 31%

Printer Failure 5% 14% 25% 28% 52%

Scanner Failure 1% 8% 11% 28% 52%

Vandalism 2% 7% 10% 32% 50%

System Maintenance 3% 4% 18% 44% 31%

Other 0% 8% 4% 17% 71%

beneficial reasons for kiosk deployment, kiosks competewith many other more accepted form factors for captureand management of this information, like MES, SCM andERP systems. Further integration with these mature systems,improvements to visualization, and reduced interferencewith factory operations will be necessary if kiosks are todeliver on the perceived benefits of these applications.”Brant sees the benefits of HR/employee self-service appli-cations for deskless employees, but sees these competingwith the home PC, where many employees prefer to reviewand select benefits with greater privacy and more time toconsider these choices. Perhaps future technology develop-ments can help to bridge this disparity, bringing togetherhome and office applications in a more convenient form. •

Even the most established

technologies will still be vulnerable

to occasional failure, but kiosk

technologies have become

significantly more robust and

reliable over the past decade.


This year, for the third time, we included a separateset of survey questions specifically geared toward

value added resellers, or VARs. For those VARs who receivedthe survey, 33% stated they were involved with kioskdeployments; 67% said they were not involved and thentherefore exited the survey. Of those who are currentlydeploying a kiosk solution, when asked what products/serv-ices their company provides with regard to this type ofsolution; 51% responded application development, 52%said project management, 70% said hardware resale, 48%are involved in networking and 68% responded support.Multiple responses were permitted to this question.

When it came to which vertical markets our respon-dents currently deployed, or have deployed kiosks in thepast, 20% said Education, 15% responded with FinancialServices/Banking, 17% said Government, (which includesthe federal, state and local levels), 25% are involvedwith Health Care, 24% chose hospitality on the food-serv-ice side, while 20% were involved in this same vertical asit pertains to lodging. There were 24% of our respondentswho said they were involved with Manufacturing/Assembly,and 8% responded they were in pharmaceuticals. Thelargest vertical represented by our survey is retail with52%; Travel and Tourism came in at 21%. On the distri-


S E C T I O N F O U R

bution side, 11% said they were involved with warehous-ing, while 12% responded supply chain. Fifteen percentof our respondents answered “Other,” which includedcare dealerships, casinos, gaming, real estate, insurance,trade shows and transportation/logistics.

In order to better-gauge growth within the kiosk mar-ket, we asked our respondents to indicate the vertical mar-kets in which there is a strong kiosk development growthopportunity for their respective businesses. Of this, 19% saidEducation, 16% said Financial Services/Banking; those in theGovernment vertical also responded 16%. Hospitality, as itrelates to food-service was 25%; lodging came in a bit lowerat 17%, as did Manufacturing/Assembly with the samepercentage points. Pharmaceuticals demonstrated 5%, whileRetail, once again, had the biggest share at 44%, behindHealth Care at 32%. Supply Chain was 9%,while growth inTravel & Tourism came in at 24%. Both Warehousing and“Other” took 8%, and 4% responded “None.” Of thosewho responded “Other,” some of the categories consistedof Gaming, Insurance, Marine Electronics, Trade Showsand Transportation.

Of those who are currently deploying kiosks, we alsoasked them to reveal what factors are currently fuelingthe growth in kiosks overall for their business model. Of

Kiosks & the Reseller ChannelI N C R E A S E D E N D U S E R D E M A N D C O N T I N U E S T O F U E L G R O W T H

Increased Customer Acceptance 58%

New and Robust Applications 47%

Technological Advancements with Hardware 50%

In-House Expertise/Track Recor 38%

Growing Demand From End User Business 69%

Other (please specify) 4%

0 10 20 30 40 50 60 70 80

Factors Fueling GrowthWhat factors are fueling the growth in kiosks for your business (check all that apply)?

24-25.K_Reseller_v2 11/18/08 4:22 PM Page 24


Determining the Best Location 21%

Integration with Other Systems 52%

Installation Difficulties 17%

Finding/Developing Robust Applications 18%

End User Buy-In 34%

Consumer Acceptance 21%

Vendor Support/Service 32%

Providing Maintenance 17%

Other 3%

Challenges for VARsWhat are your biggest business challenges in working with kiosks. (check all that apply)?

this base, 58% responded “Increased Customer Acceptance,47% said “New and Robust Applications, 50% said“Technological Advancements with Hardware” and 38%said “In-House Expertise/Track Record. The largest responsewas “Growing Demand from End User Business at 69%;4% said “Other,” which included “Cost of Fuel,” “Ease ofUse” and Strong ROI.

Of course with any new up-and-coming technology,there are always going to be challenges. Therefore, weasked our respondents to tell us some of the biggest obsta-cles they have experienced when working with kiosks. Ofthat group, 21% said that it was sometimes “Difficult toDetermine Location,” while 52% noted that “Integrationwith Other Systems” posed obstacles. Seventeen percentsaid that they experienced “Installation Difficulties,” and18% said that they sometimes had an issue “Finding/Developing Robust Applications.” In addition, 34% saidthat “End User Buy In,” was often a challenge, and 21%said “Customer Acceptance. On the support and mainte-nance sides, 32% said that “Vendor Support/Service poseda challenge, and 17% responded “Maintenance.” Of the

3% who responded “Other,” some of the challenges were“Cost/Pricing” and “High Failure Rates on Equipment.”

Despite the challenges outlined, consumer acceptanceDOES continue to grow,especially in today’s economy whenmany end users are looking “to do more with less,” so there-fore kiosks should take center stage, as many will strive tocontinually provide the ultimate customer experience. •

Despite the challenges outlined,

consumer acceptance continues

to grow, as well as end user buy in,

when it comes to kiosks, especially

as many strive to continually provide

the “ultimate customer experience.”

24-25.K_Reseller_v2 11/18/08 4:23 PM Page 25

The proliferation of the Internet and computer kiosksacross the business landscape provide telling signs that

the self-service model is taking hold and becoming part ofthe new norm for service delivery. Everything from bankingand retail to airlines, hotels and restaurants are aggres-sively pursuing these technologies for both customer-facingand employee-facing applications. Why? The current eco-nomic climate is driving companies to find ways to reducecosts and develop more efficient means of conducting busi-ness. Additionally, time-deprived customers are seeking fasterand more convenient ways for transacting business.Consumers today want to be in control and able to fulfilltheir needs anytime and from anywhere. Increasingly, self-service activities will occur remotely and on the go, given therising ubiquity of smart phones and other portable technolo-gies. The early adoption by banks followed by airlines, cou-pled with improved technology literacy among consumers,has set the stage, and is currently driving expectations thatbusinesses will offer multiple service delivery options so thatcustomers can select the method(s) of service that best suitstheir situational needs at any given point in time.

Interestingly and seemingly paradoxically, the hospi-tality industry is one of the largest industry verticals pur-chasing and implementing self-service technologies.According to normative thinking, hospitality is supposedto be all about service or personal ministry; that is, peo-ple taking care of people and tending to their every need.Yet, one of the defining characteristics of service is pro-sumption, the active participation of the consumer in thecreation and delivery of the service experience. Anotherimportant characteristic is heterogeneity because of theuniqueness of each customer or guest. Thus, perceptionsof service quality are individualized and contextual. Tosome, self-service is often preferable to more traditionalservice delivery options. This can become readily appar-ent when trying to register at a large, full-service casinohotel in Las Vegas during peak times with an understaffedfront desk. In such a situation, the absence of self-serviceoptions can be irritating and provide a reason not to return.

Many are inclined to think that self-service technologiesare better-suited for limited-service lodging and quick-serv-


Taking Hold T E L L - TA L E S I G N S C O N S I S T E N T LY D E M O N S T R AT E T H AT T H E S E L F - S E RV I C EM O D E L I S B E C O M I N G PA R T O F T H E N E W N O R M F O R S E RV I C E D E L I V E RY

C O M M E N TA R Y

ice restaurant environments because guest expectationsfor service levels are adjusted to justify cost-savings. Whiletrue, one should think more broadly. Four Seasons Hotelsand Resorts, had long considered technology to be a behind-the-scenes support tool. However, everything changedwhen the service staff in the pool area at its Miami prop-erty was struggling to meet company service standardsfor greeting guests and taking their orders. To solve thisproblem, the hotel installed a personal ordering systemattached to its chaise lounges so that guests could placetheir own food and beverage orders, reserve spa servicesand request service by calling a service attendant in one ofseveral different languages. The same technology was lateradopted by Starwood’s W Hotels because it was viewed aship and consistent with both the brand image and its tar-geted audience’s affinity towards technology gadgets.

Self-service does not need to imply the absence ofhuman interaction and personalization. In a differentexample, at uWink, a new casual restaurant concept thatcombines dining and digital entertainment, technologyallows guests the ability to order food and beverages whileplaying interactive social games with others seated withthem or elsewhere in the restaurant.

As seen with the examples mentioned above, the useof self-service technology is not contradictory to the con-cept of hospitality and what constitutes good service solong as the technology is appropriately applied. Success isall about finding the right match of these and taking intoconsideration a number of important factors. These includecomponents such as intuitive user interface that reflectsthe image and personality of the company, compliance withthe American Disabilities Act (ADA) for usability and acces-sibility, placement and aesthetics of the technology, andways to infuse the human touch at other key guest encoun-ters or touch points to complement the role technology isplaying in the service delivery process. •

Daniel J. Connolly, Ph.D. ([email protected]) is an associate professor ofinformation technology and electronic commerce at the University ofDenver’s Daniels College of Business with a dual appointment in theSchool of Hotel, Restaurant, and Tourism Management and theDepartment of Information Technology and Electronic Commerce.

By Daniel J. Connolly, Ph.D.Associate Professor of IT and ElectronicCommerce, University of Denver

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