1st century A.D., Roman Egypt.
People eagerly wait with a token in hand to experience an engineering marvel called the vending machine.
It might seem unlikely but with a massive history of over centuries, vending machines have been a part and parcel of human civilization. From the holy water vending machine in ancient Egypt to the smart snack vending machine in India, it has left a great impact on the global consumer, particularly in the retail sector.
So much so that the market size of global retail vending machines was estimated at USD 51.91 billion in 2021. Moreover, the beverage retail segment contributed 43% of the global revenue with smart coffee vending machines and energy drinks in the lead.
Another modern impact of the vending machine is seen in the way it continues to reshape the retail and F&B sector, especially through new-age smart vending machines. Retailers and FMCG brands are keen to understand how vending machine companies in India are moulding the retail sector by tapping into contemporary consumer behaviour, which expects immediate solutions and instant gratification.
Understanding the role smart vending machines play in retail and F&B, therefore, starts with understanding consumer purchasing trends and behaviour.
What Is Consumer Buying Behavior in FMCG?
The vending market is expected to grow at a CAGR of 8.7% between 2020-2026 in India, anchoring the vending machine strongly in the Indian retail market. This massive growth results from the unique consumer purchasing behaviour in the F&B sector. The traditional neighbourhood kirana stores, malls and hypermarkets are now facing a push from the upcoming micro markets of smart vending machines in India.
Earlier the consumer would wait in line, and go through the bothersome process of finding spare change. Then a shift in consumer behaviour was seen with liberalisation and digitalisation, but the biggest wave of change came forth with the pandemic.
Post 2019 the same consumer is conscious about:
- making physical contact
- traditional payment methods
- the time consumed
- finding the exact product all the time, everywhere.
In other words, the buyer is more aware of the consumer experience. Today consumers demand a personalised experience with minimum human interaction. Thus making the Indian retail segment all about convenience. This micro-market has evolved to be interactive, immediate and immersive.
And at the centre of this touchless, cashless and convenient experience is the smart vending machine.
Smart Vending Machine: The heart of retail and F&B sector.
As per the India Digital Payment Report for the third quarter of 2022, there were over 19.65 billion UPI transactions made, accounting for a sum of Rs 32.5 trillion. This, along with the growth rate of 71.7% for digital payment (by 2025) makes for a massive shift towards a cashless retail experience. In addition to this, the consumer demands for unmanned yet inclusive retail experience.
Adhering to the shifts in consumer behaviour, the retail market has turned towards micro markets of unmanned and cashless vending machines solving the following concerns:
Less physical contact
The consumer wants to have an inclusive and immersive shopping experience while maintaining minimum physical contact. A position that is rare to achieve in a traditional retail setup, especially in F&B retail as the consumer shops around various products to compare the prices and specifications.
Smart vending solutions address this concern in just one tap. By scanning a customised QR code, the consumers now can check out all the products on their devices and proceed to pay. This in turn is building a repetitive habit of lesser and lesser contact while shopping.
Vendekin, one of the top vending machine companies in India, provides an intelligent machine controller framework, including hardware and both a mobile app and web interface, that can help minimise physical contact by up to 95 per cent.
Continue reading How Vending Machines are Reshaping Retail & F&B
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