Kiosks Make Unique Points of Purchase

The following is a survey of the potential and drawbacks of kiosks in Israel, and their opportunities to leverage correct planning and design.

  • Al Ha'Madaf magazine
  • Jan. 2011
  • Lior Koren
Fun in the Sun – Convenience store chain in Eilat

A kiosk’s primary purpose as a convenience store that carries a broad and predictable variety of merchandise. Customers generally know ahead of time what can be found at a kiosk, even if they have never patronized a particular one before and usually use a kiosk is to meet certain immediate needs, such as cigarettes, drinks, parking passes or bus tickets, a six-pack of beer, or impulsive purchases, like candy for children, alcohol for immediate consumption, and unique services such as lottery tickets, newspapers ,etc.

Kiosks make special efforts to advertise special products, like freshly squeezed juices, ethnic foods, etc. Kiosks often offer additional services, due to their location, which change over time, e.g. payphones have disappeared due to mobile phones, but ATM machines have been added.

Fun in the Sun – Convenience store chain in EilatThe design of a new kiosk in 2010 and the store owners claim that sales are significantly higher than the average for similar stores in the same area.The design of a new kiosk in 2010 and the store owners claim that sales are significantly higher than the average for similar stores in the same area.

Structure and location

Most kiosks rarely fully utilize their greatest asset – location. Kiosks are typically located in the city center, on a main street or at a busy intersection. In Israel, most of them are located in the line of shops on the ground floor of apartment or office buildings and have similar dimensions 3.5×8 meters (11.5×26 feet) , but have different configurations, e.g. with or without rear warehouse or an upstairs gallery. In some pricey areas, kiosks may even only be 1.5×1.5 meters (5×5 feet) in sized and still provide all the relevant services.

Quantity of products

The average kiosk breaks every retail record in the variety of products offered by square meter.  The goal of displaying the maximum number of products in the minimum of space is a real planning challenge and explains why so many kiosks look jumbled and messy , which confuses the customer instead of focusing him on shopping.

Types of kiosks

Neighborhood kiosks usually have customers who are regulars, play a part in the community, and usually have a seating area. There are also kiosks that specialize, e.g. in roasting nuts or are associated with the National Lottery. Kiosks in entertainment or business areas, or that are located on main roads are different than kiosks in outlying areas. The clientele varies according to the type of kiosk and the opposite is also true – a kiosk will adjust itself to meet its clientele’s needs.

Price and competition

Kiosks have no direct competitors. Most convenience stores are located in gas stations outside of cities. The majority of supposed competitors (mom-and-pop groceries, coffee shops, liquor stores, etc.) only partially encompass the products and services offered by kiosks. Customers don’t usually expect to find “deals” at a kiosk, and assume that they will pay more there than at a supermarket or a specialty store.

Suppliers

Most kiosks have similar relationships with their suppliers (a specific brand may significantly differentiate between them). Most suppliers set up their own brand accessories for promotional purposes, which actually may harm the kiosk owner’s interests. We have often seen competition between suppliers at a point of purchase that ends up being chaotic instead of improving sales, and undermines a kiosk’s overall appearance and functionality.

Outside of thanking the supplier for the stand, refrigerator, storage facility or mobile – the kiosk owner doesn’t really have any say in the matter.

Few suppliers get involved in helping or consulting on the design or upgrade of a kiosk. Most kiosk owners have no access to the sorts of information resources and guidance available to the supermarkets. Few kiosk owners apply retail and marketing ideas and most rely only on trial-and-error. Kiosk owners can and should “take charge” of the planning and design of their retail space. When they do, either with or without the support of suppliers, they see a dramatic increase in sales and other metrics, such as customer loyalty, ease of operation and lower levels of wear and tear.

A Kiosk on the Bat-Yam beach promenadeRenovated in 2008, in cooperation with the National Lottery. The store owner claims sales increased by more than 100% after the renovation guided by Koren Visual Solutions.

Where to begin?

A number of key aspects should be addressed, which together create added value.

Meet the local conditions – Many kiosks have a mismatch between their real needs and their actual shelf space, the size and location of the counters, refrigerators, etc., which leads to unnecessary congestion or dead spots. Proper planning and setup and correct use of space can make a kiosk more efficient by tens of percent.

Planogram – Kiosks also need planograms, not just supermarkets! Planning and management of a variety of products (e.g. removing  unnecessary products and introducing new products) , the correct allocation of display space based on the kiosk’s priorities , logical division between categories, and proper shelving will create a neat and attractive shop. It will also create the right customer path and expose the customer to a wider range of profitable products, which in turn will increase the amount of time spent in the kiosk and raise profits. Proper setup will also help to prevent theft.

Branding and design – helps differentiate the space, gives it character and creates a special and memorable shopping experience.

Communication – Use the right interior and exterior signs, screens, price lists and communicate special deals. Complete communication includes all forms of communication and conveys clarity and efficiency to the customer.

Maintenance – Setup, cleanliness, lighting, climate control, etc. make the customer feel that the owner has invested in the shopping experience and creates the sense that the products are handled properly and are not defective.

Shopping experience – The customer is in the kiosk for only a few minutes, and pays quite high prices. An expensive bottle of water won’t feel as pricey in a kiosk that is well-kept and nicely designed.

Cooperation with suppliers – Bringing the supplier into the picture, whether for funding or for help with fixtures should be done as part of the overall thinking and planning and can be rewarding for both parties.

In summary, investing in the point of purchase is critical for increasing sales, especially for kiosks.

In the case of a complete renovation or advanced planning it is necessary to examine the feasibility of spreading the investment out over five-years, for several reasons:

1. The tax is spread out over five years.
2. This is the average time to display current products (and then reconsider or upgrade them).
3. The increase in sales almost always exceeds the monthly return (taking into account the participation of suppliers, if any).