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Self-Service Kiosks Drive Revenue and Address Retailers’ Pain PointsMerchants are constantly adapting to meet ever-evolving customer demands. Customer habits and purchasing trends are evolving even faster in the recently legalized cannabis industry. Cannabis dispensaries/retailers have seen a massive increase in sales and see resulting issues in meeting the demand. This demand from the customer and the rapid changes in the industry have incentivized the cannabis retailers to innovate in the ways they market and sell to customers.

By Steve Arel | Contributing writer, Kiosk Marketplace

2© 2020 Networld Media Group | Sponsored by Cocoon Technology

Merchants are constantly adapting to meet ever-evolving customer demands. They’re pushing to keep pace in the recently legalized cannabis industry, where customer habits and purchasing trends are evolving even faster.

In a short period, dispensaries and retailers have seen massive increases in sales – and subsequent issues in adequately handling all the additional activity. That has incentivized cannabis businesses to become more innovative with the marketing and sale of products, with many making technology a key component for operational efficiency.

Strong demand. Long lines. Booming sales.

“It’s a good problem to have,” said Mitch Britten, CEO of Thrive Cannabis Marketplace, one of the largest dispensary chains in Nevada. “But like any problem, if you don’t find an answer to it in a short period of time, it can negatively impact business.”

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By Steve Arel | Contributing writer, Kiosk Marketplace

Self-Service Kiosks Drive Revenue and Address Retailers’ Pain PointsMerchants are constantly adapting to meet ever-evolving customer demands. Customer habits and purchasing trends are evolving even faster in the recently legalized cannabis industry. Cannabis dispensaries/retailers have seen a massive increase in sales and see resulting issues in meeting the demand. This demand from the customer and the rapid changes in the industry have incentivized the cannabis retailers to innovate in the ways they market and sell to customers.

3© 2020 Networld Media Group | Sponsored by Cocoon Technology

Self-service kiosks, which have helped reshape brick-and-mortar retail in recent years, are now more than a viable solution, they are becoming the cornerstone for those stores’ sustainability in an industry that will inevitably be dominated by online shopping.

Technology has transformed countless business operations by giving consumers control over their shopping experience – and do so without ever physically interacting with a store’s employees. Kiosks have permeated everyday life. They are commonplace at businesses that have been traditionally focused on personalized customer service, including restaurants, clothing stores, gas stations, groceries, cinemas and even international border crossings throughout the world, including the United States.

Making kiosk integration an easier choice for businesses is the fact that consumers have become accustomed to using them. Many consumers now prefer to use technology to problem solve and serve themselves when it comes to typical shopping tasks.

The familiarity and prevalence of kiosks has translated into increased revenue for self-service technology adaptors. In fact, revenue generated by self-service solutions in North America is forecast to jump at a 6.1% annual rate to $4.4 billion by 2024.1

Easy-to-use, intuitive interfaces that allow customers to easily peruse and purchase from a large array of products without consuming valuable shelf space contribute to kiosks being successful components of a business model, according to Cocoon Technology, which has developed a self-service kiosk dubbed CocoonPod™ that is designed to aid cannabis retailers with their exponential sales growth.

Increases revenue

Kiosks and integrated mobile applications supplement standard manual processes, enabling customers to bypass counters and order ahead, while allowing employees to focus on order fulfillment and engage with other customers. Average kiosk sales have been shown to increase an individual purchase by up to 20%. 2

With labor being a challenge for dispensaries, many businesses are closing employment gaps with technology. Using automated systems at the point-of-sale, to manage inventory, for security and to run other store functions, savvy businesses utilize kiosks and integrated mobile applications for positions where resources are short.

“We’re fortunate to have a dedicated staff,” Britten said. “Like any business, there are going to be unforeseen situations where emergencies pop up or other things get in the way of workers making it in from time to time. We can easily turn to this technology when such situations arise.”

4© 2020 Networld Media Group | Sponsored by Cocoon Technology

Cocoon’s platform allows the retailer to capture incremental income and realize unique transactions with no additional increase in the cost of daily operations. It capitalizes on sorting and condensing inventory into a structured view, communicating about new products and upselling.

Cocoon Technology offers an additional unique way to attract customers to retail cannabis locations that have CocoonPodsTM through its website. The site includes mapping that identifies all the retail locations that the kiosks are placed in and displays the same up-to-date menu for those locations that would be found on the kiosk or mobile app, exposing customers to all the possible product offerings. This essentially turns the website into an additional advertising tool to attract customers to retail locations and is directly connected to the mobile applications for easy ordering.

Enhance customer experience

Long lines generally lead to long wait times which result in a negative purchase experience for customers who expect efficiency. In a survey conducted with customers that had a negative purchase experience, 54% said they share it with at least five other people. 4

At high-traffic times, kiosks enable customers to order and pay on demand, preventing congregating in front of a counter, speeding up on-site ordering.

Customers can place orders through the kiosk or mobile application, connecting wirelessly to a retailers’ main point-of-sale system, sending the request directly to order fulfillment. This streamlines the purchase experience, resulting in shorter or no wait times and increased customer satisfaction and loyalty.

Repeat business provides for stable revenue generation. The Cocoon platform tracks customer purchases and browsing history to make targeted product recommendations, which are accompanied by product information allowing customers more insight on their purchases. The self-ordering technology also acts as an education tool, showing promotions, product photos, ingredients and their associated benefits.

Cocoon Technology offers opportunities for customers to load e-wallets. Dubbed “CocoonCove,” Cocoon’s e-wallet is much like a Starbucks card, allowing customers the opportunity to load funds in a digital closed loop account connected to a particular store for future use. The stored funds are available for purchase redemption at the kiosk or though the mobile application.

Regulations require the cannabis industry to operate primarily on cash purchases. When the industry is legally able to implement other buying options, stores should be prepared to quickly adapt and begin accepting other forms of payments. Cocoon Technology’s kiosks are future proofed to allow retailers to accept credit and debit payments immediately.

5© 2020 Networld Media Group | Sponsored by Cocoon Technology

Reduces costs

Unlike many proprietary systems promising quick success, only to create obstacles and additional costs for retailers, solutions such as Cocoon Technology's operates on an agnostic open platform to ensure smooth integration with existing technologies within a retail location. The platform is designed to seamlessly connect to enterprise relationship partner (ERP) and point-of-sale systems. That integration removes the need for additional labor or costly changes in software, inventory management systems or store layout.

Tying into point-of-sale systems, Cocoon enables retailers to instantly access detailed data on sales and other trends, sort through vast amounts of information in short periods of time and take key actions to increase sales.

Though Cocoon’s apps can be accessed by anyone, the app and kiosks facilitate confirmation of legal age of shoppers at the start of a transaction. Customers must scan a valid form of ID before they are able to access the system, ensuring proper age gating for the retailer.

Offers loyalty, rewards and massive marketing potential

The self-service kiosks offer an array of savings for the customer and ample marketing opportunities for the retailer. The costumer has the ability to take advantage of daily sales and specials directly marketed to them right at the kiosk or through the mobile application.

…retaining current customer loyalty by 5% can increase that customer’s revenue by 25%-90%.

At the same time, the retailer has the ability to set up daily sales it wishes to offer in store or on the kiosk and can market directly to an individual or group of consumers based on the unique data collected through the kiosk. Additional bonus and savings for the consumer are offered through loyalty and rewards programs, an important addition for economically conscious customers routinely looking for bargains.

The loyalty and rewards program can be broadly set by the retailer and advertised within the retail location or on the mobile application, creating additional discounts for customers utilizing pre-loaded funds.

Loyalty and rewards programs build value among returning customers, increase average sale tickets, strengthen customer relationships and create brand ambassadors. In fact, retaining current customer loyalty by 5% can increase that customer’s revenue by 25% - 90%.5

6© 2020 Networld Media Group | Sponsored by Cocoon Technology

Retailers control kiosks at their establishments, allowing them to run product promotions on items they may want to liquidate, have adequate supply of or just want to upsell. This control also allows the retailer to sell advertising space to vendors who wish to expose more customers to their particular products without relying on a word-of-mouth sale from an associate.

Societal benefits of self-service kiosk

As the marketplace evolves amid the coronavirus pandemic, self-service kiosks and integrated mobile applications will play a critical role in keeping retailers in business.

The technology enables dispensaries – deemed essential businesses – to completely reopen and stay open while still facilitating social-distancing mandates designed to slow the spread of the virus. Customers can limit their contact by logging on to integrated apps from anywhere outside a dispensary to place orders, then pay for and retrieve their purchase via curbside pickup or at a designated area inside.

Kiosks and apps also offer an opportunity to promote local or national charitable donations. At the conclusion of a sale, the kiosk can inform the customer of the worthy cause. Participation can be in the form of donations or signing up to volunteer. Much like advertising, the retailer chooses the causes to support and promote.

“The versatility of kiosks position businesses that deploy them to do business more effectively and efficiently,” said Max Aceituno, senior vice president of product development and marketing at Cocoon Technology . “Customers have long gravitated to technology that is easy to use and meshes seamlessly with their daily lives. The strides that these devices have made in recent years – and will continue to make – will only further bolster their position in people’s eyes.”

About the sponsor:A division of AUSA Corporation, Cocoon Technology is a Fintech company providing platform solutions to enhance the

customer experience through self-service technology. Cocoon Technology is the developer of CocoonPod™, a robust

self-service ordering system that provides ease of transactions, integrates with existing inventory management systems,

and aggregates meaningful customer data to enhance business operations. Cocoon’s team brings an extensive

background developing diverse, consumer-oriented payment solutions for highly regulated industries.

1 Transparency Market Research2 https://www.retailcustomerexperience.com/blogs/examining-the-self-serve-kiosk-evolution/ 3 https://www.restaurant.org/downloads/pdfs/research/research_offpremises_2019104 https://www.impactbnd.com/blog/5-dangerous-side-effects-of-bad-customer-service 5 https://www.annexcloud.com/blog/10-benefits-implementing-customer-loyalty-program/