Coles strolls into kiosk country

Coles strolls into kiosk country

Coles/Myer is pushing the envelope of its new kiosk-driven retail strategy, last week revealing a strategic move to leverage Harris Technology's Internet skills in its Kmart stores.

The retail giant is set to trial two Kmart kiosks in an effort to offer retail customers access to an extra layer of service using dedicated kiosk staff and Internet-ready terminals.

The strategy follows Coles/Myer's acquisition of Harris Technology earlier this year and reflects its desire to translate some of HT's success in SME markets to home buyers in other business units such as Kmart.

In particular, Coles/Myer plans to leverage HT's Web-based and call-centre supported retail methodology.

As a result of this initiative, one analyst believes it could be just the ammunition needed by CM to crack the retail dominance in PCs and IT currently held by competitors such as Harvey Norman.

According to Ron Harris, HT's managing director, the custom-designed HT kiosks will be trialled in two Kmart stores, at Broadway in Sydney and Burwood in Melbourne, from November. If successful, the idea will potentially roll out nationally across the entire chain and into other CM businesses, including Officeworks, he said.

"Each kiosk runs on our new thin-client shop technology and will be a manned area of about 10 x 10 feet with a couple of specialist staff," Harris said. "There are four Web workstations on the outside which can be used to consult with customers and help them place orders.

"There is also a small range of stock on display but access to all of the 55,000 virtual products on the Harris Web site will be available. From the pilots we are doing with Kmart, the vision is that it could be extended all over the country," he said.

HT will train its hiosk staff to provide genuine consulting services to customers while access to the com-pany's call centre will be immediately available where additional sales support is required.

Essentially, this represents the start of CM's application of the full call centre-supported, Web-based retail methodology HT has used to great effect.

Harris said these kiosks will form an important part of CM's future play at markets "where e-commerce and the Web meets retailing". They are also vital to the growth strategy of Harris Technology as CM's IT retailing business unit, he said.

"They are not designed to replace other sales methods. The kiosks just add to the level of service being offered and represent a great way to get information out about key products that sell at Kmart."

Phil Burnham, senior analyst with channel research company Inform Business Development, said HT kiosks in Kmart stores will be great for the consumer as they add greatly to current available choice.

Additionally, with far less overheads than opening traditional-style stores, he also feels it represents a chance for CM to compete with HN for significant market share.

"It is quite a bold step," Burnham said. "[The kiosks] are a cross between advertising and direct marketing. In the past, Harris hasn't focused on consumers. As direct marketers, they have been targeting small-to-medium enterprises, so this is a great way for them to generate new business.

"The direct marketing/mail order/ Internet-type channel has a lot of potential in this country and is rather under-exploited at the moment."

Burnham added that there was a lot of potential for this type of sales model in Australia, especially with the country's geographic spread.

"Something such as these kiosks instantly gives access to HT for those who haven't already got a PC or who otherwise wouldn't be able to make the trip to a Harris store to see what they have to offer."

In other Harris news, its second retail outlet planned for Melbourne's CBD (ARN, August 18, page 34) is still on schedule for a Christmas opening. In addition, there are stores planned for other capital cities as well as the extra showroom that will accompany the new headquarters at North Ryde.

"We expect to have three new stores open before June next year - Melbourne, Sydney CBD and Brisbane," Harris said.

Meanwhile, in a recent interview on the Nine Network's Business Sunday program, Coles/Myer's CEO, Dennis Eck, claimed that in Harris Technology, his organisation had "the best Internet business in Australia".

He said the coalface Web experience of HT was accelerating its implementation of an Internet strategy across all the CM business units and Harris was "doing a lot of work for us to develop it".

Harris attributed the high praise from the CM supremo to the fact that HT has Internet transaction rates at a level which not a lot of other Australian e-businesses can lay claim to.

"Contrary to most in the game, we are actually doing great Internet business and we are profitable," Harris said. "He [Eck] knows the figures and they are showing we are doing very well.

"[CM] is very interested in that because it has now seen how the Internet works with retail."

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