Digital Sign Or Vending Machine?

If you happen to be riding the New York City subway this holiday season and get off at the Bryant Park stop, you might mistakenly think you have suddenly wandered into a beauty salon.

In partnership with Vendors Exchange, L'Oréal Paris has set up a series of vending machines—they are called the Intelligent Color Experience—to enable busy New Yorkers to grab their beauty items on-the-go.  Need some lipstick? Eye shadow?  Nail polish? Browse and buy in the station while you are waiting for your train.

But that’s not all—what makes this “intelligent” and an “experience” is the use of some advanced visual processing technologies. The L'Oréal Paris machine uses a color-recognition system to look at you and make suggestions based on the color of your clothes, for example, or your hair. You can make your purchase on the spot, or have the recommendations sent to you in an email so you can think about them further.

Welcome to the interactive, intelligent vending machine. What’s happening in vending machines exemplifies what we at Intel see happening all across retail: the use of new digital technologies to deliver smarter, more personalized, more immersive customer experiences.  If you are interested, I invite you to hear my keynote address at the 2014 Digital Signage Expo (DSE 2014) in Las Vegas, Nev. on Feb. 12, 2014. You might be wondering why would I be discussing all of this at a show devoted to digital signage? And what does it have to do with vending machines?

While consumers have grown accustomed to the highly personalized, immersive experiences that they can now get online, the future belongs to retailers who can deliver these same experiences in the real bricks and mortar world.

You see this at stores equipped with digital signs where the content automatically changes based on the demographics of who is in the store. Or retailers who equip their sales associates with point of sale (POS) systems on tablets so they can check out anyone, anywhere in the store, at any time. Or retailers who have fully embraced today’s omni-channel and are making it easy for shoppers to buy online and pickup in the store.

From real time inventory management, to customer engagement and personalized marketing, these solutions help drive profits and customer loyalty.

Is this the wave of the future for vending? From my experience, I would say the answer is definitely yes—and it’s already here. One study shows annual shipments of the new intelligent vending machines growing nearly 50 percent a year.

While these solutions seemed avant-garde just a few years ago, they are increasingly mainstream and this, in turn, is driving standardization. Instead of putting together systems from scratch, system integrators and solution developers can create solutions from an array of off-the-shelf components: from displays and media players to content management software and analytics capabilities. Instead of wrestling with interoperability issues, they can focus on the “value add”—creating vending machines that drive sales.

Also, intelligent vending machines can be remotely monitored and managed.  A capability built into many Intel processors—Intel® Active Management Technology (Intel® AMT) makes it possible to discover, repair, and protect networked solutions remotely, ultimately lowering IT support costs. Using a solution such as Intel® AMT, screens can be turned on and off (for energy efficiency) and media players can be remotely repaired.

As smart, interactive touchpoints like digital signs and vending machines proliferate, more attention is being paid to generating and managing the content that appears on them. Content may be controlled by specific brands or it can take the form of third-party advertising. Either way, content that is “context aware,” (i.e., generated as a result of analytics showing who is likely to be viewing it), is proving to be more effective.  In trial tests conducted by Intel at 10 different retailers, context-aware ads increased monthly sales by an average of 16 percent across 15 diverse product types. To simplify the deployment of context aware content, Intel this year introduced Intel® Retail Client Manager—software for managing content across consumer digital touchpoints—and bundled it directly with Intel AIM Suite which gathers anonymous audience analytics with detection technology to effectively protect the privacy of consumers.

Ultimately, the biggest factor driving the growth of digital signs/intelligent vending machines is going to be the value they deliver. Technology for technology’s sake never succeeds. Great looking content and dynamic interactivity are going to be judged based on whether they deliver more sales, more efficiently through the smarter, more personalized customer engagements.  I am convinced that the potential for sales uplift is significant. Studies like the one Intel did on context aware advertising show it’s already happening and as leaders like L'Oréal Paris, Adidas, Costa Coffee and others refine their use of technology, the success rates will grow.

If you happen to be at the Bryant Park stop on the New York subway you can see all of this action right now, but it will be easier (and warmer) to come to Digital Signage Expo in Las Vegas on February 12, 2014. There will be 200 exhibitors and lots of opportunity to get up to speed on everything that is happening in the industry.  DSE is a leader in education in our industry, so I am thrilled to be giving the keynote. Though it’s on the future of digital signage, it’s really about much more than that. It’s really about the future of retail and the epic transformation that is taking place in the industry today. Digital signage is part of that. And so, of course, are vending machines.  I hope to see you there.

Author Jose Avalos, Visual Retail Worldwide Director, Intel Corp.'s IOT Solutions Group, will be presenting the keynote address entitled, "Digital Signage Futurecasting: Insights & Predictions," at Digital Signage Expo on Wednesday, Feb. 12 from 7:30-9:00 amFor more information on the Digital Signage Expo, please visit www.dse2014.com.

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