Start Thinking Macro In Your Micro Markets

Nov. 27, 2019

I have spent most of the last six years angry at the misleading promises of success with micro markets.

“They will revitalize your company.”

“They will increase sales 4x.”

“They will make you rich.”

As the director of business development at J&J Vending, these are the empty promises I received from the vending industry. (OK, I may have made up the last one.) NAMA’s website is filled with information suggesting that market sales continue to rise. Technology companies continue to offer new kiosks and mobile payment systems created specifically for micro markets. It feels like everyone knows how to make micro markets a success, while you are looking at yours like a collection of failed Pinterest recipes.

The reality is that markets are frustrating. People do steal from you, the kiosk does break down, customers can be a little high maintenance and no matter how pretty you make that planogram look, drivers may still randomly place an iced tea in between the variety of iced coffees you had lined up for them in your plans (#merchandisingfail).

But like most things in life, it isn’t that everything is wrong; it’s more like a perspective shift is needed. And a perspective shift is what I received. There was no catalyst, no big “Aha!” moment, but through a series of conversations with competitors, some education from 7-Eleven and changes implemented by our micro market manager, I have learned that micro markets can increase sales. You just have to stop playing small.

I’d like to share some strategies J&J has borrowed from the larger convenience and grocery store industries.    

Raise your prices

There is a good chance that if you started with vending machines and then transitioned to micro markets, you did not adjust your margins to reflect convenience store pricing.

Go to a few convenience stores within your territory and record how much they’re charging for a few specific products you also offer in your micro markets to compare prices. For example, you could compare prices for a 20-ounce soda, a bag of chips and a candy bar.

If you are like J&J, you will need to raise your prices to match the pricing your research found. We recently added a quarter to the sell price on all 20-ounce sodas and chips. In some cases, we doubled the price. We used to sell cheese squares for $0.40; we’re now selling them for $0.88.

I was worried that customers would complain or that we might lose an account, but we stayed the course and raised the prices. Because, the truth is, we are a convenience industry, and customers do need to pay for convenience.

I think the vending side of our industry lost sight of that. We wanted business desperately, so rather than getting the best margins possible, we started paying the customers a portion of our sales. We undervalued what we provide for customers.

You are providing a great service to your customers by transporting food safely to their office, rotating product based on their purchasing patterns and waking up early so that they can have fresh breakfast when they get to work. You are providing a convenience, and your pricing should reflect that.

Offer sample days

Sampling days are a huge value add that cost you nothing. Key contacts love sample days because they offer perks to employees and break up monotony. Direct customers love trying new products without taking the risk of purchasing something unfamiliar. Product makers love them because they grow brand awareness and encourage direct customer feedback.

You will love them because happy customers are loyal customers. If you make your key contact look good to their team members — remember, they are the hero, you are the guide — there is a higher chance that when something goes wrong, they will respond with grace over anger. And when someone asks your customers who provides their micro market service, they’ll be happy to share your contact information.

Also, any time you give your direct customer a reason to go to the market, you increase the likelihood of sales, not only on that day, but also on days to come. Visit for more on samples.

Request free fills

Every item in your markets needs to pay rent for the space it takes. If you have brokers or suppliers asking you to place an emerging brand or a new item from an established brand in your market, ask for a free fill for each market the item is being placed in. Clearly state expectations of the volume expected of the item in the market within a set period of time (i.e., one month). At the end of the set period, assess the data, share your findings, and use the data results to determine whether the item stays in your markets.

Take advantage of marketing dollars 

At the end of the day, you can only raise your prices so much; there is a limit to what someone in their right mind will pay for a 20-ounce soda. Although sampling products can increase sales and getting free fills can increase your bottom line, ultimately we are still talking about relatively small numbers.

Marketing numbers, however, are not small. Marketing teams have deep pockets and they need to spend their money somewhere, so why not with you? Your markets provide a concentrated, captive target audience as the same people see the same market every day they go to work.

You most likely already have a TV screen set up in the kiosk to show camera footage or to highlight promotions in your market. Why not set up another screen (or hijack the existing one) to display ads for local companies or for items you sell in your market?

Keep learning 

If you’re an operator who hasn’t quite seen the return on investment you were hoping for with micro markets, I hope that implementing these tips will help you move the needle in the right direction. As this exciting industry continues to change, we’ll have to keep learning how to best operate.


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