Aslak de Silva, CEO of Selfly Store, works with customers in 20+ countries generating revenue with data and intelligent vending machines.
During my experience working across 20 countries in the vending machine and micro-market industries, I have collaborated closely with leading industry players to uncover the key drivers of sales in both automated and traditional retail environments.
During this time, I’ve spent countless hours analyzing consumer behavior, optimizing product placement and leveraging cutting-edge technology to revolutionize retail.
This article draws on my expertise and insights to offer actionable advice for maximizing sales in two distinct settings: automated and traditional retail environments.
Vending Machines: Convenience And High-Margin Items
Vending machines thrive on immediacy and convenience, making strategic product placement critical. The mantra “eye-level is buy-level” is especially relevant, as items placed at eye level often see the highest turnover. For vending machines, this means positioning high-profit or best-selling items—such as premium snacks or branded beverages—where they are most visible.
Additionally, vending machines are less susceptible to price sensitivity than grocery stores. Customers are typically willing to pay a premium for instant access to items, especially in high-traffic areas like airports, gyms or office buildings. This presents a lucrative opportunity to stock and prominently display higher-margin products, while lower-priced items can fill the bottom rows to cater to budget-conscious customers.
Still, one should not forget discounts and special offers as a means of attracting consumers to buy in the first place. Screen advertising can increase the number of individual consumers notably. Bundle deals are also great ways to increase the average transaction value and profitability per consumer in pure monetary value.
Grocery Stores: Broad Selection And Price Sensitivity
In grocery stores, the dynamics shift. Here, customers have the luxury of comparison, and price sensitivity plays a significant role in purchasing decisions. While high-margin products are often placed at eye level or featured in promotional displays, they must compete with lower-cost alternatives available on the same shelf.
Stores leverage tactics like endcap displays, loyalty discounts and in-store promotions to draw attention to higher-profit items. Price-sensitive customers often gravitate toward generic or store-brand products, so grocers must balance the visibility of premium brands with affordable options to cater to a diverse customer base.
Key Differences In Use Cases
• Vending Machines: Designed for quick, impulse buys, they excel in environments where convenience trumps price sensitivity. Products are curated for localized demand, with premium offerings positioned for maximum visibility.
• Grocery Stores: Serving planned shopping needs, they provide extensive selections and emphasize value through promotions and competitive pricing.
The Takeaway
Both vending machines and grocery stores rely on thoughtful product placement to maximize revenue, yet their approaches differ significantly. Vending machines capitalize on convenience, positioning high-margin items to appeal to impulse buyers willing to pay a premium. In contrast, grocery stores must navigate a more competitive landscape where price sensitivity and extensive options drive purchasing behavior.
Understanding these differences is crucial for businesses seeking to optimize their retail strategies and boost profitability. By tailoring placement and pricing strategies to the unique dynamics of each retail channel, companies can unlock significant sales potential while meeting customer needs effectively.
Forbes Business Council is the foremost growth and networking organization for business owners and leaders. Do I qualify?
Read the full article here
