The Retailer Summer 2018_FA_20.07

The true cost of dedicated tobacco kiosks

Robin Tombs Founder and CEO Yoti

“Supermarkets are exemplars of refined retail efficiency and customer fluidity. Just not when it comes to selling tobacco.”

SUPERMARKETS ARE EXEMPLARS OF REFINED RETAIL EFFICIENCY AND CUSTOMER FLUIDITY. JUST NOT WHEN IT COMES TO SELLING TOBACCO. The high street supermarket is a lean money making machine. Whether the likes of Tesco, ASDA or Sainsbury’s are willingly reducing waste or bowing to mounting pressures from government, the supermarket industry makes headlines most days for its latest efforts to trim the economical fat. So why has it taken so long for the supermarket to address one of the most costly aspects of its offering? There are 7.6 million regular smokers in the UK, which means big business for supermarkets, with tobacco sales accounting for 5–8% of supermarket revenue. Improving the retail experience for regular smokers isn’t just good for cigarette sales. These customers regularly buy other everyday items when in store. As it stands, though, supermarkets sell tobacco products through dedicated tobacco kiosks. Meaning a customer with a basket or trolley of goods needs to purchase those items at a self service checkout or at the staffed tills before potentially having to queue again to buy cigarettes at the separate kiosk. It’s a tedious process for the customer and a costly setup for the supermarket – especially in smaller ‘express’ style stores where space is at a premium. Dedicated tobacco kiosks require staff and precious shop floor space which could be used more profitably. The Challenge 25 requirement also states that anyone who looks under the age 25 can be asked to prove their age by showing a form of photo ID if they want to buy age restricted items. Which only creates another barrier to sale if the customer doesn’t have their ID with them in store. And for the staff member, it makes for a potentially embarrassing and even confrontational interaction if the customer takes offence when challenged about their age. The cost to the customer is in time spent queuing and then queuing again. For the supermarket, it’s the cost of additional staff and the need for purpose built kiosks or dedicated space behind cramped checkout tills in express stores. But what about the other, more serious cost of these standalone kiosks? ‘Hiding’ cigarette displays at the entrance of a supermarket is a bit like draping a sheet over a statue. We still know what’s underneath. Wouldn’t it be better if cigarettes were kept out of sight of regular and potential new smokers, and not just covered over? Dedicated collect kiosks for age restricted items would go a long way to help with that.

Earlier this year, Yoti and StrongPoint exhibited an automated, staffless dispensing machine for age restricted products at the CTSI Symposium event at the East Midlands Conference Centre. StrongPoint’s Vensafe dispensers use Select&Collect technology. It allows customers to prove their age with Yoti and pay for age restricted products at a regular till or self service checkout. The customer then goes to the Vensafe dispenser elsewhere in the store and uses Yoti to prove they’re the person who just purchased the cigarettes. When approved, their cigarettes are dispensed. StrongPoint currently have 6,000 dispensers across Europe, mainly in Norway, Sweden, Belgium and Germany. The new age verification technology is provided by Yoti. A person creates a Yoti account by downloading the free Yoti app, taking a photo of themselves, proving it’s them by recording a short video and then adds an ID document, like a passport or driving licence, to encrypt their personal identity details safely within the app. With a verified Yoti account a person can share their identity details securely with a business (at a self service checkout, for example) or another individual, by scanning a QR code using the Yoti app. To prove it’s them and not a younger sibling or a person under the restricted age limit, the Yoti user has to hold their mobile camera up to their face. The Yoti app quickly scans their face to match the person’s biometric information (their facial features and the distances between them) with the photo they added to their Yoti and the photo on their ID document. With a Yoti account and the free app on their phone, a shopper could purchase, prove their age and collect cigarettes quickly and without any staff interaction whatsoever. The Yoti identity app lets shoppers verify their age but it also provides more general identity verification too. Supermarket customers can use Yoti in many areas, from signing up to a website, logging in to their online account quickly and securely without usernames or passwords, through to ordering and taking delivery of food at home. In the retail sector, even small streamlining investments and incremental customer service improvements can pay big dividends. Elsewhere, leading brands like Carrefour and Tesco are discussing mergers and partnership plays to claw back market share from the challenger supermarkets hot on their heels. However the makeup of the market changes, what won’t change is the focus on continually improving the consumer experience and driving out costs. Until now, age verification has been the hurdle that has stood in the way of supermarkets shifting ever

closer to a self service environment. With automated customer age verification, the entire process of purchasing tobacco creates less friction, both for the customer and the supermarket, and is made dramatically less expensive for store owners.

ROBIN TOMBS // yoti.com

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