Selling desserts in grocery stores is a $25 billion business — and it’s one that Nick Yates, chairman of Reis & Irvy’s, describes as broken. Retailers spend thousands to rent and fill freezer space, only to be left hoping and praying those frozen treats actually sell. But there may be a better way. In the latest Unattended Retail Tracker, Yates gives PYMNTS the inside scoop on how his company is hoping to disrupt that business model and transform the industry with automated vending machines.
Supermarkets across the country can no longer simply rely on stores filled with fresh produce and groceries to keep customers coming back.
In national chains like Stop and Shop and Shaw’s Supermarkets, in-store coffee shops serving freshly brewed Dunkin’ Donuts coffee are never more than a few aisles away. Fellow giants like Kroger and Target have similarly added Starbucks stores inside their locations in hopes of luring shoppers in need of a caffeine kick.
More recently, many supermarkets have been experimenting with frozen treats dispensed by vending machines. One such player that is helping stores lure customers by their sweet teeth is unattended retail technology provider Reis & Irvy’s, which is in the process of rolling out its frozen yogurt vending machines at more than 100 franchise locations in the country.
According to company chairman Nick Yates, on-demand frozen yogurt and ice cream for grocery store shoppers is only the beginning. In a recent interview for the April Unattended Retail Tracker™, Yates discussed Reis & Irvy’s current vending machine offering and its plans for the future.
A Sweet Treat for Shoppers
The company’s debut machines were created in conjunction with South Carolina-based vending machine technology provider Flex Ltd. and Robofusion, an interactive robotic kiosk maker based in Singapore.
While a prototype was built when work first began on the idea nearly a decade ago, it took years to craft a device that would be viable in American supermarkets. After almost 10 years of designing and creating software and robotic components, the machines now resemble a common fixture on the new vending machine scene, Yates explained, making them both easy to use and familiar to customers.
“One of the reasons we tapped Flex for this was because they created the Redbox DVD vending machine concept, which is the most successful vending machine concept this country has seen in several years,” he added. “So, we used the same design team to take our proof of concept, make changes and create the product we’re launching now.”
The Reis & Irvy’s machines are capable of dispensing two soft-serve treats: frozen yogurt or ice cream. Customers place an order via an iPad attached to the machine, which allows them to swirl two flavors together and add toppings, layers or other special treats. They can also choose whether to be served by one of two robotic arms: Reis or Irvy.
“The machines right now offer choices of seven different flavors and six different toppings,” Yates said. “Consumers choose their product and then choose how they want to combine or mix their ingredients. The whole process takes about 45 to 60 seconds.”
The company partnered with Dannon, the world’s largest frozen yogurt supplier, to dispense the frozen treats. The pair is currently working to create new Reis & Irvy’s-branded dessert options, exclusively available via the machines.
Assorted Flavors of Payments
Serving soft-serve via robots isn’t the only way the company has looked to embrace technological innovations, however. It is eager to add any upgrade that could make the machines more convenient, Yates explained. That includes making the payment experience easier and more enjoyable for customers.
Reis & Irvy’s machines allow consumers to pay for purchases with cash, debit cards and credit cards, but they also accept mobile wallet and cryptocurrencies, like bitcoin. Going forward, the company plans to add more cryptocurrencies and other embedded payment methods.
The goal is to bring a new distribution model, driven by consumer experiences and convenience, to dessert retail sales. The current model — in which companies rent freezer space, fill it with product and hope it sells — is “flawed” and in need of an upgrade, according to Yates.
“We didn’t like that model,” he said. “We think this machine could be disruptive to that by allowing customers to come to our machines during their normal grocery trip and make it a more convenient and enjoyable experience.”
It seems that unattended convenience and customers’ control of choice has the future of dessert looking sweet.
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