November 20, 2007

Case Study: Postal Kiosks and Usage

Nice article on on USPS and plan to incentify people to use them more. Interesting stats such as 2500 out of 5000 deployed, $400/day quota on income, customers complain they cannot use cash, etc. Francie Mendelsohn makes a lot of those comments. Part of the problem with these units is that once again it is a unit adapted from other industry for use in this one and probably on the cost prohibitive side. Similiar in many ways to VCOM and NCR for that matter...

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Cash-in at USPS kiosks

By Patrick Avery editor

19 Nov 2007

It’s not a casino in Las Vegas. But if you walk into your local post office and take a gamble by using the U.S. Postal Service’s automated kiosk, you could come away with some extra cash.

At post office locations nationwide, customers are eligible to win $250 daily in cash prizes and a grand prize of $10,000 when they use the Automatic Postal Center kiosks instead of standing in line.

The USPS contest, which ended Oct. 31, was designed to draw attention to a product that is very convenient and easy-to-use, says USPS spokeswoman Joanne Veto.

“This is just another way to remind people there is a convenient way to use the post office 24 hours a day,” Veto said.

Four years into the deployment, however, one kiosk industry expert says she wonders if the contest means that the USPS kiosks are hurting for revenue.

“I think it is very sad that the U.S. Postal Service has to resort to this because there are many compelling reasons to use the kiosk without this contest,” said Francie Mendelsohn, a veteran kiosk consultant and president of Summit Research Associates. “To pay people to use it, to me, it’s just not right.”

The APC has been an award-winning venture for USPS. At the Las Vegas Self Service Expo earlier this year, the kiosk was named the People’s Choice Winner.

The kiosk dispenses stamps, which the agency says makes up the overwhelming majority of transactions conducted at post offices. In addition, APC customers can access most of the services available at the counter, including shipment of first class parcel, ZIP-code lookup, weighing and rating packages up to 70 pounds, and delivery confirmation.

Prices for shipping and stamps are the same as at the postal counter, and there is no additional charge for using the kiosk. The only catch: Users better pack their plastic, since the kiosks don’t accept cash.

Despite remaining a convenient alternative to, the kiosks haven’t pulled in high transaction volumes at some post offices, Mendelsohn said.

In fact, one post office in Salisbury, Md., got rid of its APC when it failed to meet its projected income. Customers weren't using the machine enough to meet the standard $400 a day in income, says Freda Sauter, U.S. Postal Service spokeswoman for the Baltimore district.

"Customers prefer to use cash at the vending machines to buy stamps," Sauter said in a Salisbury Daily Times news article.

Only 2,500 out of an originally planned 5,000 APCs have been deployed, Mendelsohn said.

But the inability to accept cash at the machines doesn’t seem to be a negative for the majority of the kiosks. According to the American Postal Workers Union Web site, the 2,500 APCs that were deployed between February 2004 and March 2005 collected more than $170 million.

There have been pockets of success, Mendelsohn admits.

“I have been to several post offices where there are lines to use the machines,” she said.

In order for USPS to avoid other APC closings, Mendelsohn says the priority should be focused on getting existing APCs in spots where they can meet revenue goals. Only if that strategy is successful will USPS add more kiosks.

“Attention needs to be paid to making this kiosk successful, because if they are not successful, they won’t be around much longer,” she said.

One strategy the post office might take is to put the APCs in other locations, such as a shopping mall, Mendelsohn says. Regardless, USPS’s current situation, she adds, with at least one APC unit already removed from its location, is less than ideal.

“I think this is a setback,” Mendelsohn said. “How big a setback? Time will tell.”

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Posted by staff at November 20, 2007 02:05 PM