Kings of Convenience - Change Agent

Kings of Convenience

The Industrial Age saw the development of vending machines, but it’s convenience that keeps them popular and practical.

    November 2011

By Vickie Chan

Invented in the first century by Hero of Alexandria – an ancient Greek engineer and mathematician – the first vending machine dispensed holy water at the drop of a penny (which fell onto a lever). But it wasn’t until the 1880s that vending machines became prominent, dispensing postcards in London. So what is it about this robotic retailer that consumers – and businesses – continue to find appealing?

“Convenience is the first priority,” says Hidetaka Ishikawa, Associate Director for Synovate Japan. There have been some real innovations in the world of vending machines lately. Take the Coca-Cola Freestyle machine, for example. This updated version of the iconic Coke dispenser offers over 100 different beverages, customisable via a touch-screen.

“Technology is not just for fun, it’s convenient. The lineup of products is what’s interesting,” Ishikawa clarifies.

Vending machines dispense almost anything these days. From designer jeans in Italy’s Florence train stations to phone chargers, flash drives and headphones in airports around the world, consumers can get a host of goods without visiting an actual store. The Rollaheels machine even sells stylish, Heidi Klum-approved flats for women in need of instant relief from high heels.

But perhaps the most surprising is the ‘gold ATM’ first installed by German gold-bullion dealer, TG Gold-Super-Markt in Abu Dhabi’s Emirates Palace Hotel. This year, China unveiled the country’s first gold vending machine in Beijing, which should prove popular with the Chinese, who along with Indians are the highest consumers of gold.

According to Ishikawa, another advantage of vending machines is cashless payments. “We don’t need coins or cash – just a cell phone, credit card or e-money,” says Ishikawa. The Ubox app is just one that enables swipe-and-pay at participating machines, via a smartphone. Set your balance online and get a 10% discount for every purchase.

Known for it’s busy, fast and convenient living, Japan has vending machines in the most surprising places. “You’ll find them every 30 metres. Streets are safe and machines are rarely vandalised or stolen from,” said Ishikawa. “Companies are comfortable placing them on streets to maximise contact opportunities.”

“They’re giant adverts for the products inside and they help hook customers who establish a habit of walking past and purchasing,” says a Canada-based former vending machine technology developer. “Later, they start to crave the products.” Ishikawa adds, “The machine itself can be a good brand advertisement. Advanced vending machines aren’t necessarily making more revenue, but give a positive image to the product or brand.”

PepsiCo have vended their latest PR in Argentina, to help dispel misconceptions that Lays potato chips are not made of real potatoes. One fresh potato acts as payment to start production of the chips, viewable through a glass front. Although it's actually a video of an intricate system of tubes making the chip from only potato, oil and salt, the marketing message is delivered along with your warmed, ‘fresh’ chips.

Vending machines can also give back, either to encourage consumers to recycle or to donate. After the 2011 Sendai earthquake in Japan, a number of beverage machines gave a portion of proceeds to charity. Other manufacturers responded to the “consequent danger of power shutdown to save electricity by developing eco-friendly machines, or by turning off the light in the machine,” reports Ishikawa. ”It is not cutting edge tech, but people welcome such direction.”

It doesn’t look like our love for vending machines is in danger of waning anytime soon. With brands looking to continue surprising consumers or to make consumption ever more convenient, there’s no question that the vending machine is here to stay. The real question is, what will we see next?

For more information, contact Hidetaka Ishikawa, Associate Director for Synovate Japan at hidetaka.ishikawa@synovate.com

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