I, Robot — kiosks are future of customer service

The change cost Heritage Valley $750,000 over four years, and David Carleton, the company’s chief information officer, is pleased with the return on investment.

Yet many retail outlets remain kiosk-free, with consumers preferring to try on clothes and ask sales associates for help. Fast-food executives say they’re waiting for better, more flexible technology.

Gap Inc.’s use of consumer kiosks failed because shoppers were being left alone for too long and many preferred talking with sales people, said Praveen Kopalle, a professor in Dartmouth College’s Tuck School of Business.

“This technology is very useful when customers immediately see where the benefit is, where the convenience is and where it’s more personalized,” Kopalle said, citing simple tasks such as withdrawing cash or placing a fast-food order.

McDonald’s, Burger King, Subway and others are testing kiosks and while technology providers predict widespread adoption by 2010, restaurant executives seem unconvinced.

Burger King, Arby’s, Taco Bell, Jack in the Box and other restaurants are testing kiosk software from San Diego-based EMN8, which can run on both IBM and NCR hardware. Basic machines that allow customers to order and pay with credit, debit and gift cards cost about $3,000 each, while full-service models that accept cash run up to $17,000 apiece.

Peter Boylan, EMN8’s vice president of sales, said restaurants like the machines’ “upsell” potential when customers realize they can add a milkshake or other item to a combo meal for just a few cents.

Some restaurant kiosks may even become advanced enough to recall past orders and ask customers if that’s what they want. The impact on employees should be minimal as cashiers most likely will be redeployed to help customers use the kiosks and to assist on food preparation and delivery, particularly at locations with drive-throughs, analysts said.

Airlines that use check-in kiosks are reaping upsell rewards on upgrades for first-class or aisle seats. It costs airlines more than $3 per customer when agents check them in versus as little as 14 cents each with a kiosk, said Forrester Research analyst Henry Harteveldt.

“Mobile commerce,” which involves tapping a credit card “wand” or cell phone against a kiosk at a gas station is offered by some U.S. companies, but is more the norm in Japan and some parts of Europe, said Craig Johnson, president of Customer Growth Partners, a retail consultancy in New Canaan, Conn.

“The technology is here now, it’s just a question of companies providing it and then consumers” buying in, Johnson said.

Those that prefer the personal touch can rest easy, at least for a little while.

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