KIOSKS IN BLOOM

Kiosks have often suffered the ignominy of being the "big box in the corner with a sign saying 'out of order,"' as Dennis McCoy, kiosk project manager for Lund Food Holdings, Edina, Minn., put it last fall at GEMCON (Global Electronic Marketing Conference).Yet as consumers become more Internet and cell-phone savvy, to say nothing of their long experience with ATMs, interest in in-store kiosks appears

Kiosks have often suffered the ignominy of being the "big box in the corner with a sign saying 'out of order,"' as Dennis McCoy, kiosk project manager for Lund Food Holdings, Edina, Minn., put it last fall at GEMCON (Global Electronic Marketing Conference).

Yet as consumers become more Internet and cell-phone savvy, to say nothing of their long experience with ATMs, interest in in-store kiosks appears to be picking up.

Lund, which operates eight Lunds and 12 Byerly's stores, has been one of the more ambitious users of kiosks, installing to varying degrees everything from Sony Digital Picture Stations to Healthnotes kiosks to kiosks for deli ordering, recipes, and bakery cake ordering.

Another major kiosk retailer is 7-Eleven, which has installed Vcom financial services kiosks in about 1,000 stores to date. Self-checkout, which can be considered a type of kiosk, has experienced dramatic growth -- not just in supermarkets, but in other retail channels. In other commercial settings, such as airports, train and subway stations, hotels and even some fast-food restaurants, kiosks are popping up like mushrooms after a rain.

"Customers perceive that self-service, especially at the checkout, saves time," according to "2004 North American Self-Service Kiosks," a market study released in July by IHL Consulting Group, Franklin, Tenn. "Since one of the most valuable commodities to today's consumer is time, the shopper's loyalty to a store is enhanced."

Food Lion, in its five new Charlotte, N.C.-area Bloom stores, is making time-saving and customer convenience the overriding themes. To those ends, kiosks have become a centerpiece of the Bloom offering.

Bloom debuted in Charlotte on May 26, with a second store following on Aug. 18 in Mooresville, N.C., and a third opening last week in Mint Hill, N.C. The fourth Bloom is debuting this week in Harrisburg, N.C., and the fifth will begin business in Charlotte in mid-October. (Bloom stores offer mostly the same technology, though not in all cases. This article describes the systems present at the first Charlotte store, which SN visited in July, unless otherwise noted.)

Food Lion has invested in a number of in-store systems at Bloom. Perhaps the most notable of these is the Personal Scanner, a handheld device that shoppers can use to scan products as they shop, keeping a running tally, and thereby expediting checkout at the end of the trip. (The Personal Scanner was described in detail in "Bloom: Store of the Future?", SN, Aug. 2, 2004, Page 46.)

Food Lion has also made a considerable investment in kiosks at Bloom. Besides self-checkout stations, Bloom features eight Customer Information Stations, a Wine Information Kiosk, and a Meat Recipe Kiosk.

In the pharmacy area, Bloom offers a Health Information and Blood Pressure Kiosk. Bloom also has a DVD kiosk with a selection of DVDs for sale or rent, a Kodak Picture Maker kiosk for digital photography, and a Coinstar coin-counting kiosk. A kiosk is available to those who wish to apply for a job at the store. Bloom even has a scale that allows shoppers to weigh their own produce and generate bar codes to expedite checkout.

Food Lion's own IT team did all of the integration of the kiosks in Bloom.

In deciding which kiosks to use, Food Lion was guided by the principle that the Bloom store would be based on customer convenience, said Susie McIntosh-Hinson, Bloom's concept creator of information technology. "When they come in, people need help with specific questions: Where do I find it? What's for dinner? What do I do with this [product]?" she noted.

Hinson said Food Lion executives "went through a million kiosks" in search of ones that would address those questions. Most fell short, even though they "would allow you to mine data like an encyclopedia."

An important ingredient of the technology at Bloom, Hinson stressed, is that it should blend into the store, without any one device standing out. "When you leave the store, you should say, 'That was pretty cool -- and easy,"' she said. "There's no one silver bullet."

Like all of the technology at Bloom, the kiosks are in the process of being evaluated. For example, while eight Customer Information Stations units are being deployed, the final number and locations are yet to be determined, stated McIntosh-Hinson.

As the IHL Consulting Group study noted, "Self-service kiosks are not cheap to buy, integrate or maintain, and currently there is sketchy data on not only their churn rate, but also their revenue flow." Thus, added the report, "retailers must look closely at the assumptions in any ROI calculations," though that will be shaped by falling kiosk costs and rising labor costs.

Finding the Toothpicks

The Customer Information Stations consist of touchscreens from Copient Technologies, a division of NCR, Atlanta. The product locator application in the stations was developed by TreoSystems, Charlotte, N.C. The device also displays ads and allows shoppers to scan and check prices. Food Lion may also add customer surveys to the system. "We're playing with how to leverage that," said McIntosh-Hinson. (At the checkout, the same screen serves as a checkout monitor showing a scrolling receipt.)

Shoppers who want to find out where, say, toothpicks are located need merely type the word on a touchscreen keyboard. A map appears showing the exact location of the item. Shoppers can also browse the store via a list of categories. The device offers "search tips" like trying different spellings for an item: mayonnaise, mayo, Hellmann's. It also features ads for promotions like a $10 gift certificate for any new or transferred prescription.

At such chains as Marsh and Giant Eagle, the Copient device has been integrated with the loyalty system, enabling the chains to target shoppers at the display with offers. Food Lion, however, has opted to start Bloom without a loyalty system and thus without this targeting feature.

The Wine Information Kiosk is housed in hardware supplied by NCR and runs software from ChoiceMaster, South Salem, N.Y. It enables shoppers to research wines, as well as the appropriate food to serve with wines, and to print out drink recipes. Drink recipes are a popular feature, said McIntosh-Hinson.

"People feel uneducated about wine, but there's a growing interest in it," observed Terry Morgan, Food Lion's chief information officer and senior vice president of information technology.

The kiosk is a fount of beverage-related information. Beer, for example, can be researched by country, style or name. Under any particular selection of beer, its price and historical information may be obtained. Data on whiskies, cordials, liqueurs and sparkling wines are also available.

The kiosk also allows shoppers to determine the correct quantity of wine, beer or liquor to serve at a party, based on the number of guests; their drinking preferences, from teetotalers to "party animals"; and the type of occasion, such as picnic, cocktail hour, dinner, wedding or brunch. Information like the duration of the event in hours can also be entered, as well as the percentage of liquor, wine and beer expected to be imbibed.

Though Food Lion is in the early stages of assessing the technology at Bloom, McIntosh-Hinson acknowledged that so far, the wine and party kiosk is the least-used one. That prompted the chain to change its location in July, moving it to the front of the store and merchandising wine bags nearby. "We're still learning about placement and communication, and what makes a difference," she said. Food Lion currently plans to install the wine kiosk in three of its five Bloom stores.

By contrast, the Meat Recipe Kiosk has been the most popular, said McIntosh-Hinson. It enables shoppers, by simply scanning a meat or seafood package, to generate recipes that include cooking instructions and complimentary sides, as well as guidelines based on internal cooking temperatures to determine when meat or poultry is ready to serve.

For example, scanning a package of fresh ground beef yields such recipes as spaghetti and meat balls and stuffed peppers. The recipe for stuffed peppers says they can be served with fruit salad, bakery rolls, or apple pie and ice cream. It recommends that the internal temperature of ground beef should be 160 degrees Fahrenheit before it is served.

McIntosh-Hinson revealed that Food Lion is looking into developing a database of recipes so shoppers will be able to browse possibilities instead of relying on scanning to call up suggested recipes. Also under development is the ability to use the kiosk to tell which meats are the most commonly scanned and which recipes most frequently selected.

The Meat Recipe Kiosk will be in three of the five Bloom stores. In the second Bloom store, the kiosk will be built into the meat case rather than be freestanding in the aisle. It is based on hardware from NCR and software from Shop to Cook, Buffalo, N.Y.

The Health Information and Blood Pressure Kiosk, from Stay Healthy, Monrovia, Calif., allows customers to set their own password and file health information determined by the kiosk, such as blood pressure and body mass composition. It also tells Food Lion how many readings have been taken over time and how many new users have signed up.

The health kiosk is being installed in two Bloom stores with pharmacies and one store without a pharmacy. "It may be able to stand on its own," said McIntosh-Hinson.