ROCHESTER, N.Y. -- Wegmans Food Markets here has agreed to test five interactive video kiosks for 90 days, said Ray Schwartzman, vice president for sales and marketing at ObjectSoft Corp., Hackensack, N.J.
The test will begin the first week of July, he said. The retailer has been letting employees experiment with one kiosk at its headquarters and will soon place the five in or near video-rental departments. The DVD-based kiosks play trailers from a selection of 500 movies, and also allow customers to look up information about the movies from a data base as well as reviews. A Wegmans executive did not return a call for comment.
"Upon satisfaction of the test, Wegmans wants to put them in all 52 of their stores that have video," said Schwartzman. Other retailers testing the FastTake kiosk include some Blockbuster franchisees and Movie Gallery, Dothan, Ala. Other supermarkets, which Schwartzman would not name, also have expressed interest in the kiosk.
With revenue based on advertising, the kiosks are provided free to the retailers, Schwartzman said. Both ObjectSoft and the retailer participate in selling the advertising, and revenues are split according to a confidential agreement, he said.
Four video companies have committed to the concept, including Plaza Entertainment, Los Angeles; Full Moon Pictures, Los Angeles; Central Park Media, New York; and PolyGram Video, New York. The four companies all participated in 90-day tests and are now considering one-year agreements, he said. ObjectSoft also has an oral agreement for a one-year arrangement from Universal Studios Home Video, Universal City, Calif., that it expects to complete shortly, he said. To break even, ObjectSoft needs to generate enough ad revenue to cover the cost of each machine, which Schwartzman said is $400 per month.
"The key is attracting advertisers who want to have their products promoted on the kiosks via onscreen ads," Schwartzman said. Mike Cullen, Wegmans' video category manager, "is going to aggressively work with their other grocery buyers to contact advertisers who may want to have their products promoted on FastTake." Items like candy, popcorn and soft drinks would all be ideal candidates for the advertising, he said.
Wegmans is very interested in making the test succeed and the potential revenues make it worthwhile for the retailer, Schwartzman said. "There's a good incentive for them to attract advertisers to the kiosk. If we get enough advertising revenue, then we can give them machines for every one of their locations for free," he said. "We'll be aggressively going after companies that would want to advertise on the kiosk. All Wegmans is doing is assisting us in finding potential advertisers," he said.
"FastTake allows the consumer to very quickly and easily find films whether they want to rent or buy them. It offers the same search capability as on the Internet, but at a fraction of the time.