2023 technology update: Self-service trends for vending and micro markets
Self-service trends for vending and micro markets are providing many advanced technology opportunities for operators to offer their customers – from new payment options to new machines with features that make it more convenient and easier for customers to get what they need and go. Some of these can be implemented now, yet others are expected to have a bright future ahead in the convenience services industry.
Payment options
Technology is making it easier for operators to meet consumers’ increasing preference to make tap payments. Cantaloupe’s recently released 2023 Micropayment Trends Report showed a significant increase in the amount of EMV transactions at food and beverage vending machines in 2022. EMV-enabled credit cards allow for a faster and easier tap-to-pay experience.
“We saw huge growth in contactless payments at vending machines in 2022, especially as operators upgraded to EMV contactless-enabled card readers over the course of the year,” Elyssa Steiner, CMO of Cantaloupe, said in the report’s release. “The transition to EMV-enabled contactless card readers represents a huge benefit for the operator, the consumer and for us as a payment processor.” The use of EMV chip cards has seen a steady increase at self-service retail applications including vending machines, self-service kiosks and micro markets.
Cantaloupe’s 2023 Micropayment Trends Report included analysis from a sample set of about 675,000 active card readers on food and beverage vending machines in the U.S. and Canada from January to December 2022. The results showed EMV payments were the main drivers of contactless sales at food and beverage vending machines in 2022, making up more than 52% of contactless transactions by the end of 2022. The report indicated that this growth suggests that many vending operators are upgrading their equipment to provide a safer, faster way to accept credit card payments.
“Our 2022 sales data reinforces that consumers spend more when they go cashless, to a staggering degree,” Ravi Venkatesan, CEO of Cantaloupe, said in the company’s release with the report. “For self-service retail operators, this showcases the significant revenue increases they can realize by having cashless card readers on their machines. Especially since, for food and beverage vending machines alone in 2023, we expect cashless payment transactions to grow 6 to 8% and contactless payments to grow 6 to 7%.”
Venkatesan continued: “Our findings reinforce the consensus that consumers are shifting to cashless and contactless payment options, even for smaller, on-the-go purchases. We feel the trends revealed in the report are relevant to self-service retail as a whole and look forward to observing how they evolve in 2023.”
In the education session at the 2023 NAMA Show, “How Operators Are Surviving and Thriving with New Economic and Environmental Challenges,” the panelists all agreed that technology and payment options are a top priority for customers. Kyle Murphy, business development director, Buffalo Rock, said operators benefit from the ability of micro market technology to adapt to customer’s buying habits. And, he added that he was surprised to hear in a recent sales meeting that the first thing the prospect asked about wasn’t the food, the products, or the pricing – instead, it was, “Do you accept Apple Pay?”
Palm payment and age verification
Amazon continues to announce new locations and retailer partnerships that offer its Amazon One palm recognition service – a free, contactless service that allows customers to use the palm of their hand to pay, enter or identify themselves. Earlier this year, Aramark Sports + Entertainment announced that Amazon One’s new age-verification capability will be available at Coors Field in Colorado, so customers can prove eligibility to purchase alcohol in a few seconds. The technology not only offers more convenient payment methods but also opportunities to sell age-restricted products.
Smart markets are getting smarter
Walk-in walk-out
Several new unattended retail solutions were on display at the recent NAMA Show, including Cantaloupe’s Smart Market, a completely locked micro market that allows consumers to log into a user account or unlock the market with a credit/debit card. Once the consumer has made their selections, they complete their purchase at the kiosk.
Aramark also launched its artificial intelligence (AI)-powered store in Scotland. The fully autonomous shop offers customers a checkout-free, convenient, walk-in walk-out retail store with easy access to food, beverages and essentials. The store features overhead cameras and intelligent shelf sensors, which combine detection, visual cognition and secure payment integration.
Instant Retail Systems also showcased its Self Service Store in NAMA’s Imagination Way. Customers are tracked with cameras while they shop, and shelf sensor technologies monitor the inventory. Items removed from shelves are added to the customer’s virtual shopping cart where they can modify and confirm their items prior to payment at the exit.
Smart machines
New smart machines using AI product recognition technology have the potential to replace vending machines in some locations. For example, 365 Retail Markets’ Stockwell 2.0 houses refrigerated and ambient products while offering consumers a frictionless micro market experience, and the dual-environment technology allows operators to maximize space with one machine. AI product recognition eliminates product scanning, and Pico Market compatibility enables versatile payment options including tap-to-pay, 365Pay app and traditional credit card payments.
In the NAMA educational session, “Advancing the Consumer Journey in Foodservice Unattended Retail,” Ryan McWhirter, VP of product management with 365 Retail Markets, said his company’s core principle is to make using its equipment fast, easy and intuitive for end users. He added that a phone and a kiosk are often seen as competitive, but 365 Retail Markets finds that they can be compatible for checking out at a micro market, and a variety of solutions in breakrooms can be used to meet customer needs.
Bill Moxey, director of strategy and planning at PepsiCo, also a session panelist, added that 70% of consumers want to have a more seamless, instant and convenient experience when they are shopping in the food and beverage space.
New location opportunities
According to data from the recent Automatic Merchandiser State of the Industry Report for Vending and Micro Market, operators shared that more and more of their vending locations are being converted to micro markets due to more office re-openings. In 2022, manufacturing locations increased 7.5% from the previous year, and office locations increased 4.5%. Operators also shared that they are finding more opportunities for micro market locations at hotel and motels, which also jumped in 2022 – as well as a trend for airport locations, which is expected to grow in 2023 and beyond.
Conclusion
Whether it is updating vending machines to cashless or implementing a fully locked micro market using artificial intelligence and computer vision, these new technologies are available for operators to meet customer demands for a quick, easy and convenient purchasing experience. ■
Molly Rogers
Molly Rogers is the former editor-in-chief of Automatic Merchandiser and VendingMarketWatch.com. She has more than 20 years of experience in custom publishing, B2B and B2C magazines, as well as advertising and marketing. She served readers by covering the latest news in the vending, office coffee service and micro market industry and helping companies connect to their audiences through strong editorial solutions.
To reach the editor of Automatic Merchandiser and VendingMarketWatch.com, email [email protected].
