STORES Magazine - May 2008 - (Page 44)

WORTH WATCHING / KIOSKS Try and Buy MOD POD adds purchasing capability to media kiosks BY JANET GROEBER S eattle-based MOD Systems began shipping its Consumer Kiosk to retailers in January. Dubbed “MOD POD,” the freestanding, turnkey, touch-screen kiosk allows customers to search, sample, purchase and download digital media quickly and easily. Downloaded digital content can go onto a DVD or optical disk, USB drive, SB card — or directly to an MP3 player or cell phone. Users can even create cover artwork and take the whole package home — or opt to ship it to another location. What’s more, there’s a small capital commitment to inventory since “stock” is delivered digitally rather than from store shelves. And MOD POD can be deployed almost anywhere a retailer believes it has a mediaconsuming demographic and the traffic to support the expenditure. Anthony Bay, MOD Systems’ executive chairman and co-founder, predicts a revolution in the merchandising and selling of music, games, feature films and TV shows. “Sampling and merchandising systems allowing customers to preview content have been around probably 15 years, and we had some heritage in building those,” he says. But those units “didn’t allow customers to buy” content. Plenty of those sampling stations are still used in major book and record store chains, but Bay hopes to render them obsolete with his company’s new digital media platform. First, however, he wants to reassure retailers that, contrary to popular perception, not all entertainment is purchased online at home. MOD POD “could be deployed by any retailer with a brand and a demographic they feel they can target well,” Bay says. Retailers use content like music, movies and games for a variety of purposes. “Some use it to increase basket size, others use it to drive store traffic,” he says. Think airports, coffee shops and convenience stores, and you get a sense of MOD POD’s penetration potential. Business model MOD POD offers something for traditional media merchants, as well. For chains like Best Buy and Circuit City, MOD POD offers a way to manage a virtual inventory of digital music and movies at both the corporate and store level: it enables retailers to augment physical in- Prepare for a revolution in the merchandising and selling of music, games, feature films and TV shows. — Anthony Bay, MOD Systems 44 STORES / MAY 2008 store stock and, in turn, address out-ofstock issues, Bay says. The MOD POD business model is based on fixed costs similar to rent and fixtures. Retailers “pay us a little bit a month to run it on a per-store basis,” Bay says, “but it’s relatively fixed” overall. In addition to cost, kiosk downtime has also been a concern to retailers. That’s a big reason MOD POD was designed and engineered like an electronics product. “It just runs and runs without rebooting,” says Bay, who predicts consumer acceptance will closely mirror the initial acceptance — and subsequent proliferation — of ATMs. He points to Redbox, the video rental vending machine concept currently popping up in supermarkets, drug stores and fast-food restaurants across the country, as a “great first step because it gets people used to interacting with a screen [in a store] to get a DVD.” The downside, he says, “is the limited physical inventory because it’s subject to what can fit on the backside of that machine.” With MOD POD, “there is no inventory and retailers aren’t invoiced until the end of the month in which the StORES sale is made.” Janet Groeber is a Cincinnati-based business writer. WWW.STORES.ORG http://WWW.STORES.ORG

Table of Contents Feed for the Digital Edition of STORES Magazine - May 2008

Stores - May 2008 Contents Executive Editor's Page President's Page Contrasting C-Level Compensation Across Segments What Shoppers Think 10 Things You May Have Missed Numbers Worth Counting Full Price/Markdown Retail People Cover Story: Concepts That Clicked Concept2Watch Kiosks Artificial Intelligence Tech Support Online LPinformation Data Synchronization Human Resources Site Selection POS Selection Communications Biometrics Networking Systems Credit Loeb Retail Letter Arts Update Point of View NRF News Retail Crossword Retail Industry Calendar Last Laugh

STORES Magazine - May 2008

For optimal viewing of this digital publication, please enable JavaScript and then refresh the page. If you would like to try to load the digital publication without using Flash Player detection, please click here.