Technology Turns Vending Machines into Smart Retailing Systems

By: Lee Rickwood

March 18, 2020

Sweet!

Technology is turning the quaint old vending machine into a powerful smart retailing system, using big data analytics, cloud connectivity, customer interactivity, multiple electronic payment options and slick audio/video presentations on big LCD screens. Some machines will communicate with customers, sending them texts, promotional messages, and purchase receipts.

And the stuff being sold in these new high-tech sales devices includes almost anything: sure, hot snacks and cold drinks, but also books, toys, beauty items, diapers, drugs, and products from the pharmacy.

Did we mention luscious cupcakes and scrumptious sliced cake?

Traditionally, vending machines were basic mechanical tools constructed to dispense products. The machine’s capabilities were defined by technology such as gears, levers and chain-pulley systems.

But the latest trends in automated retail technology are adding smart computer-driven features and functions, bringing real-time data collection about the product, process, and customer. Customized software programs and cloud-based management services help vendors utilize the gathered intelligence to improve service, monitor inventory and upsell customers.

American cupcake bakery chain Sprinkles created a vending machine that dispensed fresh cupcakes nearly ten years ago. At about the same time, here in Ontario, the academic community came together with the food processing industry to develop robotic cupcake-makers and other food processing and delivery technologies.

carlo and his cake ATM

Toronto now boasts three cake ATMs – vending machines selling cake slices made by baker and TV celeb Buddy Valastro. Image from The Publicist Group.

But much more recently, Torontonians could have a slice and eat it, too: refrigerated “cake ATMs” appeared in pedestrian malls to much acclaim. Carlo’s Bake Shop, a New Jersey bakery made famous by baker and TV celeb Buddy Valastro, baked the goods inside.

Each machine holds more than a hundred slices, selling for $8.99 each (plastic utensils included). You can watch your selected slice be transported within the machine to your waiting hands as you listen to a fun little musical accompaniment.

The company behind the machines, an Australian outfit called the Express Retail Group, is not only planning to install more machines, according to reports, but it may also hire a human attendant to be nearby “to better understand the customer experience with the machine”.

The customer experience with some machines may be heated.

people looking at vending machine

This vending machine makes and bakes pizzas on request; it does not reheat frozen pre-made products.

In fact, Pizzametry will bake a pizza for you! The machine actually makes and bakes pizzas on request, it does not reheat frozen pre-made products. This sophisticated vending machine (it has its own IP address like other Things on the Internet) begins with raw ingredients (flour, water, tomato sauce, pepperoni) and customers can watch each step in the process through windows on the front.

A large video monitor is used to start the ordering process, and to show advertising content, information about the pizza, and any other messages the operator wants to deliver during a roughly four-minute baking process. Messages like “We have patented our technology globally, and each machine has eight computers using over 300,000 lines of programming to ensure a consistent product”.

Pizza is always popular, so one of the leading pizza chains is rolling out its Pizza Portal service in nearly all its Canadian stores.

Little Caesars lets customers pick up their own ready-to-go pizza without store line-ups, having ordered via a new mobile app or online portal. At the pickup location, customers enter the three-digit pin or scan a QR code they’ve received, open the secured compartment and grab their order. The Little Caesars mobile app includes various payment options, store locators and an interactive drag-and-drop menu. Touch ID/Fingerprint and Face ID login functionality have recently been added.

If pizza is not your thing, be aware that vegan treats and plant-based foods are also available from vending machines.

U.K.-based company Vegan Vend managed to secure funding through a Kickstarter campaign and it has installed its first fully stocked vegan vending machine, featuring treats from local independent businesses. The company also collaborated with local artists to design the artwork on the machine.

vegan vending machine has flowers drwan upon it

Plant-based foods are available in vegan vending machines in the U.K. Image credit: @vegan_vend/Instagram.

As pretty or tasty or convenient as vending machines can make our various purchase experiences, as capable and intelligent as they are in supporting business activities of many kinds, the vending machine operations business in Canada is hurting.

Five years of industry contraction (up to 2019) have led to projected revenue declines of about 8.5 per cent (an annualized rate) or more than $450 million over that period.

There is plenty of opportunities to grow, nevertheless, and that growth itself will have dramatic impacts well beyond the sector.

According to market research, automated retailing will soon be worth billions.

But growth may come with collateral damage. Nearly 7.5 million retail jobs will likely be automated out of existence as a result, according to a report by investment advisory firm Cornerstone Capital Group.

The losses will disproportionately affect the working poor, as most hourly retail workers live below the poverty line. Retail cashiers, 73 per cent of whom are women, will suffer the most job losses, the study found.

So the rise of automation will not only impact retail workers but will also have broad implications for the economy as a whole, according to Jon Lukomnik, the executive director of the Investor Responsibility Research Center Institute, which commissioned the study.

One very unique approach to this emerging new vending machine reality can be found at a Toronto bookstore known as the Monkey’s Paw.

biblio-mat book vending machine

Machine fabricator (and creative content guy) Craig Small built the book vending machine from scratch, using about $1,000 in off-the-shelf materials. Watch the Vimeo video for more information.

The custom-designed and built Biblio-Mat satisfies curious book-lovers with a surprise as it delivers an unknown book in exchange for a low-cost token. This randomizing old book dispenser can lead customers onto other great finds and it encourages a build-up of the bibliophile community in and around the store.

And that’s really sweet!

 

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As a somewhat troublesome pre-teen, many many years ago, I used the vending machine to build community in a different way.

The machines might not be in use anymore (some are on eBay), but there used to be a kind of horizontal pop machine in my neighbourhood. These old trunk-style vending machines served up pop bottles (glass bottles, not cans) that were suspended by their neck in a grid of flat horizontal blades. Once you put in your quarter (I told you, this was a long time ago), you could slide your bottle of choice to the end of the metal blade and lift it out of the machine.

But if you were so inclined (and a little troublesome), you could get the cap off the bottle as it was still suspended in the machine, using a bottle opener. With a handy straw, you could then drink pretty much all the pop in the machine – without paying a dime!

Our gang did this a lot back in the day.

The machine operator would find only a series of half-empty bottles at month’s end, not a handful of change.

Sorry guy……

vintage coke bottle machine

An old pop bottle vending machine is for sale online; be careful who you let use it – and how!

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