Thursday, November 02, 2006

Instant Credit Kiosks boost credit card applications, usage and sales

Kiosk Marketplace is running a story about retail credit kiosks. While WireSpring was asked to add some information about our instant credit kiosk solution and customer success stories, we unfortunately missed the deadline by a few minutes. Here's what I would have added to the article from our end:

WireSpring works with a number of hard- and soft-goods retailers to provide instant credit services. The system itself is quite simple: we place touchscreen kiosks at strategic locations on the sales floor. Shoppers use the kiosks to enter their credit and contact info (such as name, address, and phone number), which is then sent to the issuing bank via a secure Internet connection. The bank determines creditworthiness in a matter of seconds, and instantly returns an account number and credit limit for those who are approved. The kiosk can then print a temporary paper card or permanent plastic card for immediate, same-day use.

In WireSpring's experience, credit kiosks work best in situations where the products are fairly high-margin and have a big decision factor that can be swayed by having additional credit resources. In these cases, our customers have seen an average ticket increase of 10-25%, and 7-10% increase in portion of customers using store credit, leading to a very strong ROI for the instant credit initiative (typically 100-150% net after expenses).

Employee training is extremely important for driving traffic to the kiosks. Also, one interesting caveat is that in many cases the retailer will actually see their approval rate decrease, as more people (and in particular more sub-prime candidates) will apply at the kiosk, because it's much less intimidating than giving personal information to a store clerk. However, the net amount of credit provided increases, and those who have more money to spend (in the form of store credit), will often "trade up" to a more expensive product or add other (typically high-margin) accessories to their purchases than they would have otherwise.

Past articles about instant credit kiosks include:
Instant credit kiosk makes its debut
Kiosk form Source Technologies says 2005 revenue were up

Tags: instant credit kiosks, retail kiosks, retail marketing, advertising, finance kiosks, store credit, private label credit

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