Changing consumer preferences about shopping and the high cost of operating brick-and-mortar stores are inspiring premium brands to rethink how they sell their wares. As Gower Smith, whose company, ZoomSystems, has created about 1,000 automated kiosks called ZoomShops, put it, “A ZoomShop costs less than an employee.”
And with examples overseas showing there is money to be made, the so-called automated retail store (the term vending machine is so Industrial Revolution) is venturing into fashion, beauty products, electronics and more.
A couple of months ago, the Body Shop cosmetics franchise began offering skin care products with ingredients like hemp and vitamin E in deluxe machines at airports; soon will come shopping centers.
In the fall and winter, a company called U*tique will begin selling high-end beauty products in machines that light up when customers approach — a better reception than shoppers see from most retail employees.
In the last few years, Best Buy, Sephora, Apple and Proactiv have put their products in vending machines. Quiksilver offers board shorts and bikinis in machines at Standard hotels.
Such machines also offer nascent brands that have no store outlet another way to bring their products to market. Customers can make returns by calling a phone number on the receipt.
In an age of iPads, high-speed Internet service, A.T.M.’s and self-service check-in at airports, consumers expect instant gratification. Not only are they accustomed to researching and buying products on their own by touching screens and pressing buttons; they often prefer it.
A study published in 2008 by NCR Corporation found that 86 percent of North American consumers were more likely to do business with companies offering some sort of self-service. Many respondents also said they had a more positive perception of a brand if it offered self-service technology. This appears to be especially true of young shoppers.
“You will hear in studies, ‘My mom shops at the beauty counter, and I want to shop for products on my own,’ ” said Mara Segal, chief executive of U*tique, which plans to install up to 20 automated machines this year before going full throttle in 2011. “They are actively avoiding the counter.”
The new machines are meant to provide a feeling of discovery and charm often lacking in traditional retailing. Indeed, the machines are not “stocked” — they are, as Ms. Segal put it, “curated.” Merchandise in U*tique machines is arranged and lighted like works of modern art in a series of dainty portals, evoking a neon honeycomb.
“We put a lot of attention and focus on all the things that are sexy about retail,” she said.
The machines — which bridge the gap between old-fashioned stores and online shopping — are not only being installed in airports and malls. They are materializing in supermarkets, military bases, college campuses, even chain stores.
The economics make it easy to see why. Mall stores produce about $330 a square foot a year, while a 28-square-foot ZoomShop can generate $3,000 to $10,000 a square foot a year, Mr. Smith said.
Or consider airports, where stores make about $1,000 a square foot and ZoomShops generate $10,000 to $40,000 a square foot, he said. ZoomSystems, based in San Francisco, charges the brands in its machines a fee that includes the cost of rent at an airport or mall. Landlords typically take a percentage of the sales too.
As Mr. Smith noted, the attraction goes beyond payroll and rental expenses. If an airline closes a terminal, or if customer traffic is slow in a particular mall corridor, the machine can be unplugged and moved.