Coinstar, which owns and operates the only multinational network of supermarket-based machines that offer coin counting and other electronic services, has added a kiosk machine for prepaid wireless phones, prepaid debit cards and a prepaid MasterCard at the 12 Weis Markets in Lancaster County.

Although Coinstar has more than 10,000 machines linked by a sophisticated interactive network throughout the United States, as well as in Canada and the United Kingdom, only Weis Markets is carrying the latest technology in this area.

George White, regional public relations manager for Coinstar, believes his product is a good fit for a grocery store, where now restoring cellphone minutes can be done at the checkout line, providing one-stop shopping.

"I believe no one has time to go out of their way to recharge [buy more minutes] for their phone or for prepaid cards,'' White said. "Mainstreaming is how you service people. People go to the grocery store two or three times a week.'' White said the goal is to mainstream the product in front of the public. So far, Coinstar has made good on this goal. The company had about 50 coin machines in stores at the beginning of 2003. By the end of 2003, there were more than 600 coin machines in stores across America. There are prepaid kiosk machines on about 100 college campuses, and there are more machines slated for stores in 2004.

"Our strategy is to make services more accessible than ever before,'' White said. "Prepaid cellular is a very effective way to make sure you do not go over budget. It is also effective with college students who are on a budget.'' In today's society, with double-income families, there is more pressure for time and convenience, said Dennis Curtin, public relations director for Weis.

That is why it is adding the Coinstar machines and phone services. In addition to being a convenience to the customer, the services help Weis compete with other supermarket chains.

He said the supermarket chain started adding Coinstar machines about four years ago. With 132 of the machines at its stores, Curtin said, Weis believes the alliance with Coinstar reinforces Weis' theory that if you get someone into the store, he will find something he needs.

Adding machines that convert change to coupons, and most recently the prepaid services, were done as a convenience for the customer, said Curtin, who added Weis competes with other supermarkets for price and convenience.

"In today's supermarket, we compete on broad fronts,'' Curtin said. "The key is value, the price and offering more. We view it as a convenience. We all have had extra coins that we wanted to cash in.'' Now those coins can be cashed in for a coupon that can be redeemed for any store product.

"Now Coinstar is taking it to the next level with prepaid cellphone and calling cards,'' Curtin said. "If it saves the customer money and time, then the customer will come back. If you give them good options, they will keep coming back in the store.'' White said the new products on machines in Weis in this area include prepaid wireless (all major carriers), prepaid long distance, prepaid game time on the Internet, prepaid digital content (cellphone ring tones and games) and prepaid MasterCards. On the horizon are additional products, such as bill payment, gift cards and money transfer.

Coinstar and Weis are banking on the potential upside of prepaid products. The prepaid industry is projected to triple over the next five years, according to The Yankee Group and The Pelorus Group, both of which have studied the potential of prepaid products.

These studies determined that the prepaid market earned $56 billion in 2002 and is projected to grow to $156 billion by 2007. Prepaid wireless volume was $5.7 billion in 2002, $7 billion in 2003 and is projected to grow to $15 billion by 2007.

According to a Coinstar Teens Talk poll, 12 percent of teens (ages 12-17) say they own and spend money on prepaid wireless phones, while an additional 22 percent plan to purchase or receive one in the next year.

White said Coinstar is attempting to meet the needs of credit-challenged people as well. He said the The Pelorus Study states that 50 million adults in the United States do not have credit cards and 10 million households do not have bank accounts.

"The main point with prepaid products [is] many times they are inaccessible to the public,'' White said. "If you have prepaid cellular, you have to go out of your way to recharge. Now it is easy to recharge the phone while getting bread and milk, and you'll be there [the grocery store] twice a week.'' blog comments powered by Disqus