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M2M Vending Machines Show What MNOs Can Do With Connectivity, M2M Platforms and Mobile Payment Services

Writer:Written by Tara NeaDate:2015-05-15

Abstract:

 

 

 

 Endless Opportunities. The Vending Machine is perhaps one of the best use cases to look at if one were to assess how M2M services will create endless revenue opportunities for MNOs.    

 

Endless Opportunities. The Vending Machine is perhaps one of the best use cases to look at if one were to assess how M2M services will create endless revenue opportunities for MNOs.  

In the deployment of their M2M solutions, MNOs will often be supporting a single functional area for the enterprise – for example, production, inventory management, security or distribution. M2M means that a business process and the factors of productions involved in that process will be tracked, reported and analyzed remotely and wirelessly and the information and insights will be communicated and integrated with the enterprises’ cloud and business systems – the likes of SAP or Salesforce - and then delivered to computers and connected devices from which all the information can be accessed and acted upon by the end users.

The Vending Machine segment is an area of application that is very note worthy within the M2M space, simply because it extends the use of M2M technologies and platforms to the widest scope possible. Enterprises operating Vending Machines are using M2M technologies to manage the entire supply chain - from production all the way to customer feedback, which sees the M2M platform powering multiple M2M connected functionalities at the same time. More interestingly, they are seeing how Vending Machines are bringing together other services they offer – such as NFC based mobile payments – to offer an end-to-end connectivity plus other value-added services for the Operators of these Vending Machines.

From the Factory to the Warehouse

Of the many legs of communication enabled by M2M connectivity, the first point will be between the factory and the warehouse. The factory receives orders from the warehouse as inventory reaches a certain level. M2M technologies are used to track the inventory and report the numbers to the M2M Platform which can then be accessed from the factory floor to ascertain the quantity of production required by line of products.

From Warehouse to the Vending Machines

The Vending Machines report their inventory levels to the M2M Platform and via applications on driver devices and computers in the warehouses, the Vending Machines that need restocking will be identified. Drivers need not make their physical rounds to check each Vending Machine for inventory levels and possible technical issues, but can obtain all the updates on their Apps and hence, be able to prepare the right stock mix to fill up the machines and be able to schedule and plan their deliveries efficiently.

From Vending Machines to the Enterprise’s Central Office

Vending Machines, via the M2M Platform, report not only their inventory levels but also on other conditions such as technical issues, vandalism and power issues. Overall downtime due to restocking delays is also reported. Where resets and technical configurations are enabled remotely, the central office can address these technical challenges in real-time, ensuring service continuity and that proper notifications are displayed to customers. The self diagnosing and timely reporting to the Central Office also saves maintenance costs as staff need not be dispatched for each and every complaint.

At the same time, based on information collected from all the connected Vending Machines in all the areas, Operators of Vending Machines will be building their own big data and via filtering and analysis, be able to churn out insights on changes in demand for each product, the price elasticity of their products, consumer buying habits, seasonal and regional trends and other information that is critical in ensuring the right marketing mix is put in place.

From the Central Office, enterprises can change the digital information, prices, digital adverts, promotions and other settings which will then, leveraging the M2M platform, be reflected across all the Vending Machines, not only those in a particular region, but across the country and around the world. Enterprises will hence be controlling all their machines, at all times via a simple connection to the Internet, making millions of physical visits to the Vending Machines unnecessary.

Consumer Devices to Vending Machines

Vending Machines take not only cash, but also debit, credit and smart cards and more recently, NFC-based payments. Connected Vending Machines are able to offer all these, and authentication of the payment can be done over the Internet, and deductions can be made from the customer’s debit/credit cards, Mobile Wallet and Virtual Cards stored on the customers’ mobile devices. At the same time, payment errors or issues with payment can reach the Vending Machine Operators in seconds, directly on their mobile devices, allowing them to address these issues in real time, which may include resetting the machines over the Cloud.

On the consumers’ end, they just need to scan an electronic bar code that is displayed digitally on these M2M Vending Machines to access product information and other details via relevant Apps on their mobile devices. Calorie information, price, and ingredient list are examples of such information. For non-food products, product information, product website links and recommendations/reviews can be provided instantaneously onto the customers’ digital screens.

From M2M Platform to Everything Else

The M2M Platform integrates with all other business applications for the enterprise, which means that the information sent by a single vending machine can, in real-time, be updated in the inventory, the order queue, the complaint list, the management accounts and the financials of the enterprise – providing timely inputs for the warehouse, the factory, the customer service unit, the management and the financial departments. The M2M platform updates information onto the applications that are accessible by business users as well as customers, via cloud-based desktop applications and apps for smartphones and tablets. At the same time, the M2M platform sends information to other M2M platforms on other clouds, allowing enterprises to share insights and provide information to other third parties who leverage this data for their own business.

Does it stop here?

Certainly not. If the Vending Machine Operator wants to introduce loyalty schemes, rewarding frequent customers with points or discounts, a mobile app and the purchase evidence generated by the Vending Machine is sufficient to enable the Operator of the machine to offer dynamic pricing to select customers. All a customer has to do is use his/her mobile device via the Operator’s app to communicate (via Bluetooth or NFC) with the Vending Machine which checks with the subscriber management system in the Cloud to enable different prices to be charged based on the customer details.

In addition, customers can provide feedback on products by simply scanning the digital codes on the Vending Machines and use the Operator’s App to key in their feedback and complaints.

M2M Forces Machines to Acquire Greater Computing Capabilities

M2M Connectivity and being able to link to M2M Platforms in real-time means traditional machines such as the Vending Machine are now metamorphosizing into intelligent machines with enhanced computing capabilities. Intel, for example, recently announced the Intel® Reference Design for Intelligent Vending built using the Intel® IoT Platform. The solution aims to address the connectivity and computing requirements across a large number of existing Vending Machines currently not connected, managed or secure. The solution enables multiple compute workloads to be integrated – covering segments such as vending machine controller, touch screen, telemetry, digital advertising, payment and transaction management and back office applications – allowing Operators of the Vending Machines to upgrade their assets to meet the needs of the new generation of consumers.

Coming back to the ‘creation of endless monetization opportunities’ for MNOs, the Vending Machine is a classic case where MNOs can pool multiple capabilities – their 4G LTE connection that allows sensors on M2M devices to capture and transmit information continuously, including rich data such as videos, their hybrid networks that boast cheaper and purpose specific connectivity such as Sigfox-and-4G, their IoT platforms provided in the Cloud on both outsourced and pay-as-you-use models that come with extensive big data analytics and processing capabilities, their custom M2M platforms that are offer pre-integrated components for specialized use-cases, their Application development facilitation offered via open APIs and their Mobile Wallet and NFC based payment integration to these wallets – to offer vendors dispensing their products in every street corner a ready-to-deploy off-the-shelf solution that meets the needs of customers. Teliasonera’s tingco® business system for online machines is one such solution available in the market today that ties together these services for a comprehensive end service.

With M2M connectivity and deployment of M2M Platforms, MNOs can expect the growth of this segment to accelerate as more consumers start using NFC based payments, mobile wallets and self-service kiosks to fulfil their needs. To date, the Vending Machine has been used to dispense more products that can ever be imagined – ranging from lottery tickets, envelopes, stamps, postcards, newspapers and magazines, toys, jewellery, cigarettes, milk and eggs provided directly from farms, medications and even insurance policies! With M2M capabilities, items which were previously unfit to be delivered via Vending Machines can now be offered, and coins and cash shortages will not hamper sales as they used to in the past.

Given the forecast by IDC that expects global shipments of Vending Machines to reach 2 million units by next year, there are ample opportunities not only in this segment, but across the retail segment as a whole, for example, the automated retail (that’s where customers order from a kiosk/outlet's digital display and items are packed and delivered from the warehouse), where M2M solutions will be critical is powering seamless inventory management and sale and delivery of various products. Teliasonera, Verizon Wireless, Deutsche Telekom, Telekom Romania, Bell Canada, Orange, Telekom Austria, EE and Vodafone have already paved the way in pushing M2M solutions in the retail segment via their own connected Vending Machine and other related point-of-sale solutions, and for MNOs looking to strengthen their presence in the IoT space specifically in the retail space, the Vending Machine is a great place to start. It gives them the opportunity to put their relatively new M2M platforms to test – having to power the entire supply chain – and helps them make inroads into powering more sophisticated M2M applications in future.

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TypeInfo: Industry News

Keywords for the information:M2M