A host of technologies have emerged to provide vending operators new benefits in recent years: cashless purchasing, remote machine monitoring, electronic security, data-based menu planning, and more. One technology that potentially offers the vending industry major growth is video screens that effectively transform vending machines into video terminals.
Streaming video technology, in combination with Internet connectivity, gives the vending industry the possibility of creating a powerful network for video advertising, news alerts, and other point-of-sale video communication. The video technology, in combination with remote data transfer, gives marketers one of the most powerful tools ever created for location specific marketing.
Advances in streaming video technology have been taking place in tandem with remote machine monitoring in vending. As these technologies converge, they create a host of opportunities for the vending industry.
Last month, Automatic Merchandiser reviewed the progress of a network of vending machines in Phoenix, Ariz. retrofitted with light emitting diode (LED) screens carrying text messages.
Where LED screens are limited in their audio and visual capability, the liquid crystal display (LCD) screen is a much more visually powerful format. A handful of technology companies have developed LCD screens for vending machines and have been testing them in cooperation with LCD content providers, vend product manufacturers and vending operators.
The most extensive testing has been done by Automated Vending Technologies Inc. (AVTI), based in Corona, Calif. AVTI is both a vending machine operator and manufacturer and has developed its own vending management software and hardware. AVTI has exhibited its machines, equipped with proprietary software and hardware, at vending trade shows in recent years.
AVTI's glassfront machines feature a 7-inch wide LCD screen, located above the payment keypad, playing pre-recorded, streaming video content. The video screen connects to a PC via the Internet, which allows content to be sent to the machine remotely. The LCD screen uses the same PC connection that allows remote access of other machine activities.
AVTI's proprietary interface allows the operator to remotely communicate with their vending machine from any Internet connection via Cingular Wireless' wireless network and receive real-time sales data, inventory levels and maintenance updates from the machine.
Screens play streaming videos
In the past year, AVTI tested streaming video commercials in 10 of its machines in cooperation with some vending product suppliers. The 10 AVTI machines displayed commercials for Otis Spunkmeyer Inc., Living Essentials Inc. (maker of 5-hour Energy) and Tropicana Products Inc., who provided AVTI with product to measure the impact of the video commercials on sales. Another 10 machines serving similar populations were configured with the same products but without the video screens for comparison purposes.
The machines involved in this test did not have cashless readers.
The company claims the video commercials resulted in 20 percent to 30 percent sales increases for the products advertised. AVTI will expand its testing to more machines.
Jim Rosenthal, national sales manager for vending at Living Essentials Inc., said his company also provided AVTI with TV commercials to run on the video screens. He said he believes the tests demonstrated that the videos positively impacted the sales. He said he was awaiting information on the frequency of the ads and the size of the audience.
“That medium has created awareness and is stimulating growth for particular items in the machine,” Rosenthal said. “If it stimulates a purchase, it's well worth it. This is a developing process.”
Rosenthal compared the vending video screens to TV infomercials, which have proven to be a very successful sales tool.
Rosenthal agreed that modern vending machine technology offers a product marketer the ability to quantify the audience, particularly when compared to other advertising media.