August 27, 2002, 12:00 AM

Retail kiosk shipments poised for growth, Frost & Sullivan says

Retailers worldwide will spend $222 million on kiosk installations this year. That will grow to $333 million in 2008.

 

Retail industry spending on in-store kiosks will recover next year from a flat market since 2000, Mukul Krishna, industry analyst with researchers Frost & Sullivan, tells Internet Retailer. Retailers worldwide will spend $222 million on kiosk installations this year. That spending will grow to $333 million in 2008, he says. “We’re seeing enthusiasm coming back, with a more positive outlook for kiosk deployments in retail in 2003 and beyond,” Krishna says.

The state of the economy has kept kiosk deployments in retail flat for the past three years. “Kiosks are not seen as mission critical to the retail industry,” he says. “The average kiosk costs $6,000 and if a chain is looking at 100 of them, they’re likely to hold off on such a purchase until the economy gets better.”

Nonetheless, retail deployments represent a significant portion of the kiosk business, which totaled $492 million last year and will reach $745.8 million in 2008, says Frost & Sullivan’s new report Worldwide Interactive Kiosk Market.

Retailers primarily view kiosks as customer service devices, suited to such functions as gift registry, dispensing of coupons to customers in loyalty programs and product demonstrations, Krishna says. The notion of expanding a store’s inventory by making products the store normally does not carry available over a web-based kiosk is still unproven, he says. Krishna says that idea could take up to another two years to prove itself.

Only about 20% of retail kiosks are stand-alone, the rest are networked either through a company’s intranet or through the Internet. In the latter case, retailers restrict the browsers on kiosks to prevent customers from shopping at competing retail web sites, Krishna reports.

“In an increasingly competitive market, interactive kiosks play a vital role in helping organizations stay ahead by enabling them to deliver improved customer service,” Frost & Sullivan’s report says. “Enhanced kiosk applications bring value to end users by allowing them to perform a wide range of self-service functions. Recent technological developments that have resulted in attractive kiosk designs and growing awareness among both customers and end users will lead to a wider acceptance."

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