Self-Service Success
According to the 2007 Hospitality Technology Self-Service Study, there is a growing demand from consumers for self-service options in both lodging and food service. In fact, consumers prove more ready to use kiosks than operators are to deploy them. In order to address this issue, we've spoken to top self-service industry analysts and hotel and restaurant operators to identify the 10 key strategies for your successful self-service implementation.
- Have a strategic business plan.
- Capitalize on upselling.
Upselling is another concrete benefit for calculating ROI. Every screen on a kiosk can offer upselling with complete consistency and accuracy. Research has shown that customers often forget that a kiosk tried to increase the amount he or she spent, or how many times it did so. With staff, customers can become irritated and are less likely to say "yes" to attempts at upselling. Kiosks can also use photos to add appeal and auto-suggest items to customers. Upselling on kiosks has been shown to produce a 40 percent take rate (the rate at which customers opt to purchase the suggested item), and this is one of the major advantages of implementing self-service in hospitality. According to Tim Marks of Danny and Clyde's Food Stores, which implemented a Micros solution (www.micros.com), "Our typical kiosk order is 10 percent to 20 percent higher than at the order stations. The kiosks offer extra cheese, seafood or combos every single time."
White also recommends involving as few vendors as possible to manage the project, and working out all of the potential bugs before going live. Earlier this year, the Checkers franchisee installed an NCR (www.ncr.com) EasyPoint Xpress Order and Pay kiosk, partnering with InfoAmerica (www.infoamerica) and Wand Corporation (www.wandcorp) on touch screen and point of sale software solutions, and is already seeing an increase in the average ticket order placed at the kiosk.
- Train staff to encourage self-service.
If you offer your employees incentives such as rewards or perks for helping customers use the new kiosks, the units are more likely to be successful. If you don't get employee buy-in up front, they'll see the kiosks as a threat to their job security and jeopardize the kiosks' success, even going so far as to unplug the machines. "A paradigm shift is needed by your staff in their approach to self-service," says White. "Explain that you're not cutting costs, you're increasing throughput. Tell your customers that, too. Self-service repositions jobs."
- Include creative marketing and promotions.
Promote your new self-service offering before, during, and after the launch. Send out incentives to reward customers for their first use of the kiosks. This step often gets left out of the budget, and jeopardizes the success of the entire project. If people don't know about your self-service option, they won't come in for it and they won't use it.
- Communicate with customers.
Emphasize the advantages of self-service for your customers -- especially speed and order accuracy. The most successful self-service implementations include "greeters" to introduce customers to the new kiosks. For the first several weeks, customers are given coupons or other incentives to redeem on the kiosks as they walk in. "You really have to sell it, and train your customers on your front end," explains Marks. "Don't alienate the customer -- you can lose business that way. Always greet, and instruct or help as needed." It is important to help customers with the first touch on the screen, and then let them enter the order themselves to speed learning and adoption of the new technology. Younger customers are usually tech-savvy, and enjoy ordering/checking in for the entire family.
- Location, location, location.
Placement is the most underestimated element in encouraging the use of your kiosks. If they're tucked into a corner with no signage, no one will know to use them. The best location is often next to the service that is being complemented, such as the order boards or front desk. "Location is the key -- it is paramount to everything," explains Lance Marrin, corporate director of rooms for Hyatt Hotels Corp. The company has installed NCR EasyPoint Xpress Check-In kiosks in some 85 locations. "You should have two or more kiosks placed as close as possible to the front desk for assistance. Personnel can then shift over to help as needed. You need the human element to support the automation. Also, with one kiosk, most people think it's an ATM. Multiple kiosks draw more users because they see other users and join in without having to stand in line behind them."
Signage that is visible from a distance is vital in drawing users to your kiosks. Many kiosks are branded to blend in aesthetically with their environment, but they need signage to get noticed. In Europe, interactive digital signage is merging with kiosks as an attractor in itself. It's still a passive medium here, but that will likely change soon.
- Reward customer loyalty.
Integrate self-service with your loyalty program to recognize guests, personalize service and speed repeat orders. Most QSR orders are the same every time, and customers appreciate the speed and convenience of seeing their usual order come up after swiping their loyalty card or regular payment method. Some coffee shops reward regular customers with an unmanned express service lane that remembers and speeds through their preferred morning beverage. Other self-service loyalty applications include program registration, rewards redemption, targeted promotions, automated upgrades and points for using the kiosks. According to the leading self-service industry analyst, Francie Mendelsohn of Summit Research Associates, "Make sure you offer your customers a kiosk that works every single time. It's very expensive to attract guests, so make sure you keep them."
- Line busting.
Given the rate of staff turnover and the cost of training in hospitality, line busting is a prime application for self-serv-ice. "This is a line buster for us," explains White of FHG Enterprises (Checkers). "Our goal was to increase top line sales by 10 percent through the kiosks, and we're at 8 percent to 9 percent of total gross sales on the kiosks now. Plus, as our manager says, Ã.‚¬ËœThe kiosk has yet to call out sick.'"
- Killer applications.
New kiosk applications include room selection and upgrades with floor plans, airline check-in and boarding pass printing at the hotel, and driver's license scanning for age identification at the kiosk. Stored value cards can be updated in real time, as the kiosk communicates to a centralized server that the card has added or reduced value. Multi-lingual kiosks can act as a language bridge, providing better customer service and helping staff to communicate better with customers.
The list of applications will continue to grow, but you need to be very selective about which to prioritize. "The key to successful self-service is to keep it simple. Start with one or two applications, and be prepared to make changes. Software can collect all the touches showing where users do and don't go, so you can always tweak it or add new applications once customers are used to it. Uncluttered screens are very important to the success of the main application," Mendelsohn explains.
- Invest for the future.
Although most hospitality operators use self-service to complement their staffing, this trend is expected to change in the next five to 10 years. Self-service may come to dominate much of customer service, particu-larly in the QSR space, where just one manned POS station could also act as a concierge to handle questions and unusual coupons or requests. "Between Generation Y and the advances in technology, kiosks will be processing 50 percent of our business transactions five years from now, just like credit cards are now 20 percent of our QSR business," White predicts.
Hyatt's Marrin is even more confident. "Just like wheels on luggage put bell hops out of business, self-service and wireless will eventually put the front desk out of business."
Think through in advance how implementing self-service is going to impact your business model. Make sure it's an accessible and easy application for everyone, from your front-line people to your management to your customers. To the greatest possible extent, make sure the self-service application will be completely integrated with your point-of-sale (POS) or your property management system (PMS). According to Darrin White, director of operations at FHG Enterprises (a Checkers Drive-in Restaurants franchisee), "Food-ordering kiosks offer a tremendous oppor-tunity to increase throughput." However, with this increased throughput comes increased responsibility, he notes. "Can I service that? Do I have enough manpower to fill those additional orders?" White suggests restaurants ask themselves these questions in the planning stages.
White also recommends involving as few vendors as possible to manage the project, and working out all of the potential bugs before going live. Earlier this year, the Checkers franchisee installed an NCR (www.ncr.com) EasyPoint Xpress Order and Pay kiosk, partnering with InfoAmerica (www.infoamerica) and Wand Corporation (www.wandcorp) on touch screen and point of sale software solutions, and is already seeing an increase in the average ticket order placed at the kiosk.
Return on investment (ROI) is often difficult to justify for kiosks because of the size of the initial investment (ranging from $5,000 to $30,000, depending on their capabilities) and the difficulty of measuring "soft ROI" such as improved customer service. However, food ordering and hotel check-in/out kiosks can significantly cut costs by helping to reduce or reallocate staffing, as well as by increasing accuracy in fulfilling customer orders and requests. Consider implementing a few concrete ways of measuring success, such as automatic reporting on sales or the percentage of kiosk use versus the front desk or order stations.