25/06/2010 15:38LifeStyle:News:Global

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Premium brands embrace one-touch retail 2010:06:16

Words: Sarah SolomonVisuals: Natalie Jones

Santa Monica – Vending machines are evolving from their traditional use of supplying snacks to delivering more sophisticatedmerchandise, allowing brands to revitalise their retail services.

The change presents clear growth potential for vending operators. With revenues expected to reach $11.3bn this year, up from$11bn in 2009, according to market research company IBISWorld, beauty brands such as Sephora and U*tique, and theMondrian South Beach hotel in Miami are all taking advantage of this profitable sector.

An established feature on the streets of Japan – where there is one automated machine for every 23 people according to theJapan Vending Machine Manufacturers Association – vending machines are becoming more common across the globe,supplying products from the fashion, beauty, food and electronics categories.

Miami’s Mondrian hotel has installed futuristic vending machines with touchscreens replacing buttons. Sensors ensure that acustomer’s credit card is only charged when the selected item has been delivered. In recent years beauty retailer Sephora hasalso incorporated vending machines in its retail offer.

This autumn U*tique will initially sell premium beauty products in 20 automated machines that light up as customers approach.Mara Segal, CEO of U*tique, opts for ‘curated’ rather than ‘stocked’ visual merchandising, giving products a highly luxuriousquality, and providing the consumer with a unique sensory experience.

Vending machine company ZoomSystems has introduced about 1,000 automated stores, or ZoomShops, across the US andJapan. According to owner Gower Smith, ‘a ZoomShop costs less than an employee’. ZoomShops are also extremelyprofitable, says Smith. Stores in American malls generate around $3,630 per square metre a year, whereas a ZoomShop cangenerate $33,000 to $110,000 per square metre per year.

With brands such as Apple, Proactiv, Macy’s and The Body Shop all introducing automated machines, self-service retailing isan increasingly viable option for the lifestyle industries.

In a world in which gadgets and the internet dominate, where the public demands instant service and product satisfaction, andwhere individuals often prefer self-service shopping, automated machines offer a natural progression in retailing.

For more developments in retail services, read our Beyond Retail report.