Self-Service Economy Arrives Gradually

Fred Street, the hardware lab test co-coordinator, wipes condensation off the IBM Anyplace Kiosk,Tuesday, July 31, 2007 during the test inside the Thermal Chamber on the main IBM campus in Research Triangle Park, N.C. The Thermal Chamber can test cold, hot and humidity. (AP Photo/Karen Tam) (Karen Tam - AP)

WASHINGTON -- At airports, supermarkets and big-box retailers, "customer service" in recent years has meant self-serve _ aided by touch-screen kiosks.

As digital kiosks become more user-friendly and capable of handling more complicated tasks, health care providers, fast-food chains and other businesses say trading face-to-face encounters for face-to-monitor transactions improves service and saves money.

Yet the complexity of human decision-making and service expectations in different industries means any possible self-serve revolution is more likely to be a gradual transition.

"Every time you see a door, there's an opportunity for a kiosk to be deployed," Juhi Jotwani, director of marketing and strategy for retail stores at Armonk, N.Y.-based IBM, likes to tell her staff. Opportunity is knocking: IBM's kiosk orders have quadrupled in the past four years.

Numerous airlines use IBM's customer kiosks. Caribou Coffee and Cheesecake Factory employees use them to manage recipes and to enhance order speed and accuracy. The Virgin Megastore in Times Square has 150 kiosks that process 450,000 music previews per month.

Still, "none of the players in this market have even scratched the surface" of the multibillion-dollar potential, Jotwani said, even though consumers hooked on text-messaging and interactive Internet gaming now expect greater control over their purchasing experiences.

An April report by consulting firm Summit Research Associates Inc., estimated 800,000 customer kiosks, not including ATMs, will be installed in North America by the end of 2007 and hit 1.2 million by 2009.

North American consumers in 2007 are forecast to spend more than $525 billion at self-checkout lanes, ticketing kiosks and other self-service machines, including postal kiosks, according to IHL Consulting Group. That figure could reach nearly $1.3 trillion by 2011.

NCR Corp. products process more than 23 billion transactions annually and roughly 40 percent of the Dayton, Ohio-based company's $6.1 billion in 2006 revenue was from self-service hardware, software and services.

Since a 2-for-1 stock split in January 2005, the company's stock has risen about 50 percent and was trading at $52.70 Thursday afternoon after second-quarter results beat Wall Street estimates earlier this week.

Consumers now accustomed to ATMs dispensing cash and self check-out aisles in supermarkets and home improvement stores expect self-service options in other parts of their lives.

Mike Webster, NCR's vice president and general manager of self-service, is targeting the health care market. More than 100 U.S. hospitals use NCR technology and the company plans to expand overseas by year-end.