Sept. 4, 2013
Commentary by Jennifer Wickham
Owners and operators of convenience stores are all too familiar with flat-lining or declining sales in certain product categories. But instead of allowing tobacco and alcohol sales affect your profit margin, targeted financial services such as bill-payment kiosks and ATMs can be strong, viable options to increase foot traffic and boost in-store sales.
Here are five tips on how to grow your business with bill-payment kiosks:
1. Identify the financial service products you want to offer that will be profitable.
Bill payment is one of those unavoidable tasks that always return without fail. Bills like phone, electricity, water, gas, satellite and cable TV come every month; therefore they offer recurring revenue opportunities that can form the foundation of a successful alternative financial service provider.
According to a Federal Reserve study, pre-paid debit cards represent the fastest-growing non-cash payments in America today. These popular cards mean more opportunity to increase profit, build loyalty and increase foot traffic. Real-time reloads mean frequent customer visits that can be leveraged to grow your other financial services products.
Revenue can be increased over time by introducing new services at the store such as money order, money transfer and credit building — all of which can be sold to an existing payment customer.
2. The easier and faster your bill-payment system is to use, the more payments you will build.
Bill presentment gives your customers the ability to just walk in, type in their phone number and pay their bill without having to remember to bring their account number with them. This means more frequent, spontaneous visits to your stores.
Real-time posting means that the customer's money is immediately posted to their account. The under-banked demographic often pays bills at the last minute, often hours before service cut-off. Real-time posting means that your clerks get increased customer satisfaction and less questions or hassles due to payments that were not posted immediately or on time to a customer's account.
3. Offer over-the-counter as well as bill-payment kiosk options.
How you choose to deliver your financial services (either self-service or behind-the-counter), is dependent on your expected growth timeline. Each one has a useful role to play, depending on your current and expected size, staffing ability and customer demand expectation.
A bill-pay kiosk can support convenience store operators in providing prepaid products and money orders, while at the same time pulling traffic off of the counter and making the establishment more secure by eliminating cash exposure.
4. Focus on serving the needs of financial customers by offering a choice of language and mode of payment.
The under-banked market is very diverse. To serve this market, you need to offer the service in the language the customer is most comfortable, which is not always English. Also accepting several different types of payment, such as credit, debit, cash and check, also ensures that customers can easily pay in the mode that is most convenient for them.
5. The more awareness marketing you provide, the quicker your payment business will grow.
Let customers know about your new service through in-store marketing materials. The only costs convenience store operators typically assume on a deployment are connectivity and marketing-related charges. Like all in-store initiatives, there is a direct connection between the marketing push that is done and the profitability of what you are trying to sell.
Jennifer Wickham is a marketing coordinator at TIO Networks Corp., a cloud-based multichannel bill-payment processor.
Read more about bill-payment kiosks.
Photo by 401(K) 2012.