Blog Post from January 18, 2021
Debunking the 7 myths of self-service kiosks. This may save you $$$ !
By Bart DeCanne
The adoption of self-service kiosks that include options for contactless payment has accelerated in the past year due to Covid, and is generally accepted to be a mainstay post-pandemic. Operators of retail, hospitality and entertainment venues continue to look for cost-effective additional points of purchase to avoid wait lines and crowding during rush hours, and in general, increase sales by enabling a more frictionless purchase experience, while also lowering cost of sales from higher automation.
So what about not just enabling contactless payment but a completely touchless sales experience to also avoid cleaning expenses and, maybe even avoid a future liability for accidental infections? Obviously existing kiosk vendors whose business depends on selling expensive touchscreen displays, have a vested interest to not move away from the touchscreen user interface. It's a textbook example of the "Innovator's Dilemma". Hence you see mostly new suppliers to the kiosk space proposing UI alternatives, such as waving hand gestures in front of a display, or audio commands.
But much like a touchscreen-based kiosk, all these methods suffer from the same limitation: they're not multi-user: each requires the installation of 5 kiosks if you want to allow 5 simultaneous checkouts.
Furthermore existing kiosk vendors may argue that you need to purchase all kiosk hardware as an integrated set to make sure it is certified for transactions on all major card networks. Or that you need to source the kiosk from the same vendor / reseller as your POS in order to re-use your existing merchant account.
Hmmm... Let's go over each of these, and a few other, arguments. Be forewarned: we'll call them the 7 myths of self service-kiosks...
1. You need custom hardware sold by a kiosk hardware vendor
Traditionally installing self-service kiosks was a large undertaking, a 'project' that required the involvement of companies, somewhat pejoratively called 'metal sheet benders' within the digital signage industry. Those are companies that create the (custom) kiosk fixture and act as a general contractor to incorporate the various electronics: touchscreen display, computing & media player hardware, payment terminal.
Of course if your self-service kiosk is a 'vending machine' that actually dispenses products there is a large value-add in the mechanical dispensing mechanism. But for kiosks that are just used for ordering services, or for ordering products with in-store pickup or drop-ship to a customer's home, the integrated hardware approach is really no longer needed, especially if you can avoid a touchscreen (as detailed more below). A cost-effective kiosk can actually be created rather easily from off-the-shelf components. Read on to find out how.
2. The whole kiosk fixture needs to be certified by the payment card industry to ensure PCI compliance
In modern payment systems "tokenization" avoids the disclosure of sensitive payment card information to those elements of the system that are not involved in authorizing & capturing the actual payment transaction. So any sensitive information can be restricted to the communication between the pay terminal and the payment gateway. If the pay terminal offers a tokenized API to the rest of the system, no other components of the system need to be certified for PCI (Payment Card Industry) compliance as they only receive the one-time use 'tokens' to reference the transaction, not any card data that could be used again for another (rogue) transaction. It is the real-world equivalent of e-commerce payment providers that provide embedded payment solutions for websites: only the payment providers need to be certified to clear payment transactions, not each single website that embeds their payment form...
3. You need a touchscreen for user interaction
The ideal UI allows for easy customer personalization of the transaction including customer identification. A public touchscreen does not meet this since customers are reluctant to enter personal information on a public terminal. Other input methods such as gestures or audio commands are only useful for anonymous commands (would you be speaking your name and home shipping address aloud to a kiosk in a retail store, even if its voice recognition would be reliable? - and it most probably won't be reliable since names and addresses are not part of a limited dictionary that could be easily voice-recognized).
Furthermore none of these methods allow for simultaneous use by multiple people. Touchscreens may be multi-touch, but they're not really multi-user...
Only 1 UI device meets the goal of easy product selection and private data entry: our own mobile phone. And you may already have payment cards stored in a mobile wallet so you can even avoid the need to tap, dip or swipe a physical card to complete a purchase. Since everyone has a smartphone, simultaneous checkout is baked in.
Thus the most logical self-service kiosk user experience is one that interacts with a customer's own mobile phone, and that just works in the mobile browser, without requiring an app install.
4. You need enough floor space to put the kiosks on
Let's expand on the prior point. If all user interaction is via someone's own phone, then we don't need a touchcsreen. If we don't need a touchscreen then we can use a much less expensive regular display. And since there is no touch, we don't need to place that display within arm's length of the customer. In fact, we may want to mount the display higher-up: wall-mounted, or overhead on a ceiling-mount. Besides increased viewing range, no valuable floor space is then taken up at all. And there is much lower risk for vandalism. And there is no need for an expensive trip-proof robust floor mount which can actually be as, if not more, expensive than the display itself.
5. You need multiple kiosks to avoid simultaneous use and avoid lines
If all customer interaction to select products and complete a purchase is via a customer's own phone, after he/she sees relevant products advertised on a nearby large display, with payment completed on the phone as well, then obviously multiple transactions can be placed in parallel.
However completing a purchase from a mobile phone would be considered a 'card not present' transaction that typically incurs higher transaction fees for the retailer since it is considered higher risk for fraud by the payment networks, as compared to a transaction that involves a physical card. For that reason you may want to use physical pay terminals to complete the sale since the customer is on-site anyways.
So after the customer creates a "shopping cart" on their phone, the actual purchase is completed on a pay terminal device placed near the signage display. An EMV transaction takes only a few seconds so wait lines can be much reduced if we are able to associate a pay terminal with each incoming transaction, and if we can find a way for a single terminal to handle them sequentially. Instead of having a wait time of 2 minutes per customer when using a touchscreen to select products, we reduce wait time to a few seconds only waiting for the prior customer to complete payment by a tap, dip or swipe!
And if we are to support 5 customers paying simultaneously, we just duplicate the pay terminals. As long as the main "controller' of the kiosk can handle multiple pay terminals, we do not need to duplicate the rest of the hardware: we still only require a single display and a single "kiosk controller", which could be software integrated onto the same media player that drives the display.
6. You need to buy a kiosk from the same POS vendor to be able to fund into your existing merchant account
The backend setup for a merchant is different than the front-end point-of-sale. A good analogy is your email client software vs your email ISP: you can setup Mac Mail or Microsoft Outlook as your front-end client but still use it with your Gmail email account. Likewise you can have multiple front-end systems (your current POS and an additional kiosk) connected to the same payment processor or gateway, all funding into the same merchant account. It really depends on which payment processors and 'acquirers' are supported by the kiosk solution vendor. But saying you need to buy the kiosk from the same vendor or reseller as your POS is, well..."fake news".
7. You need to budget over $5,000 for each kiosk with a large (40"+) display
A 40-50" touchscreen will set you back at least $2K-$3K for an indoor touchscreen display, and significantly more for a weatherproof outdoor display. Remember that with a touchscreen based kiosk, you need 5 of these to do 5 simultaneous transactions. Then add the mechanical fixture, controller/media player and a pay terminal to each, and $5k becomes a conservative estimate. So 5 units becomes a budgetary $25K expense.
But drop the touchscreen and you could just use a $200 consumer 50" TV at least for indoor use. Hang it on the wall with a $50 wall mount. Add to this a standalone professional media player and a separate pay terminal, each retailing for ~$400, and your kiosk hardware cost now becomes in the range of $1,000 to $1,500. Let's say $2K if we stretch it by usin a more professional display. This is at least a 60% cost reduction!
And if user interaction is via mobile, then it should be possible to allow simultaneous checkout for 5 by just having 5 pay terminals, as mentioned earlier. So instead of $25K for 5 traditional kiosks, your total hardware cost is lowered to the order of $3.5-$4K, not a 60% but a 600% reduction, while keeping all other benefits (possibly no floor space, less risk for injury, less cleaning costs, less liability)!
You may wonder if a system like this actually exists... You may want to check out ProxiPay-Go, Sophatar's SaaS solution that can turn any display into a revenue-generating kiosk at this link:
https://www.sophatar.com/products/proxipay-go/
We believe it delivers to debunk all 7 myths.
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