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One of the main objections a machine operator may have with providing the cashless option could be the transaction fee that they could incur from the credit/debit card company, particularly for small value transactions, which is what most drinks vending machines are used for. This concern has its own legitimacy, but considering the overall benefits of the additional option and the potential revenues it can generate, a cashless vending machine could be seen as an option that could yield a lot more revenues (and profit), albeit at a marginally lower profit margin per transaction.
A couple of key consumer-side factors that can benefit cashless vending machine operators are listed here:
⢠Growing customer comfort with various forms of cashless technology: Consumers are increasingly becoming comfortable with using credit cards and debit cards, even for very low value transactions, which was certainly not the case until recently. However, with the card companies marketing their products aggressively by doling out a host of loyalty / usage benefits, consumers are duly incentivized to use the cashless option.
⢠Consumers donât want to carry a lot of loose change: A cashless option lets consumers use the vending machine without thinking about carrying exact change or getting a whole lot of coins as balance.
⢠Provides potentially more sales from tourists: International travelers who recognize brands of products dispensed by a vending machine but are prevented by the unavailability of local currency will also appreciate the cashless option. As number of tourists grow, this could be a much stronger reason that it may seem initially.
⢠Capitalizing on impulsive buying: A large number of purchases from vending machines are believed to be impulsive purchases. It has already been noted by economists that impulsive purchases become even more likely with the availability of options to pay by credit and debit cards. This increases the probability of consumers using a cashless vending machine more and thus contributing to more revenues and profits for a machine operator.
Cashless technological advancements in vending machines already include the use of contactless RFID technology. Going forward, we may soon see the possibility of biometric payments in vending machines as this technology matures and finds more diverse applications.
A couple of key consumer-side factors that can benefit cashless vending machine operators are listed here:
⢠Growing customer comfort with various forms of cashless technology: Consumers are increasingly becoming comfortable with using credit cards and debit cards, even for very low value transactions, which was certainly not the case until recently. However, with the card companies marketing their products aggressively by doling out a host of loyalty / usage benefits, consumers are duly incentivized to use the cashless option.
⢠Consumers donât want to carry a lot of loose change: A cashless option lets consumers use the vending machine without thinking about carrying exact change or getting a whole lot of coins as balance.
⢠Provides potentially more sales from tourists: International travelers who recognize brands of products dispensed by a vending machine but are prevented by the unavailability of local currency will also appreciate the cashless option. As number of tourists grow, this could be a much stronger reason that it may seem initially.
⢠Capitalizing on impulsive buying: A large number of purchases from vending machines are believed to be impulsive purchases. It has already been noted by economists that impulsive purchases become even more likely with the availability of options to pay by credit and debit cards. This increases the probability of consumers using a cashless vending machine more and thus contributing to more revenues and profits for a machine operator.
Cashless technological advancements in vending machines already include the use of contactless RFID technology. Going forward, we may soon see the possibility of biometric payments in vending machines as this technology matures and finds more diverse applications.
