Q-bot puts new twist on coupon distribution

Technology is now changing the way people use coupons and even what they are called.

A new device known as Q-bot dispenses "Q-pons" to shoppers at the touch of a button from a 5-foot tall kiosk.

Q-bot machines can be found at the Apple Market in Rogersville and Summer Fresh in Marshfield, but by June this technology will be in all Springfield Kmart locations. Negotiations also are under way for Price Cutter in Ozark and several nationwide retailers.

What is Q-bot?

Q-bot LLC is owned by Bob May and Lee Larscheid. The system was developed and launched in October 2002 in Branson by Cutting Edge Technologies, owned by Robert Taylor and Larscheid. As a partner of Q-bot, Cutting Edge acts as the primary sales company.

Q-bot is a touch-screen device that is located in the entrance of a store, said Brian Gentry, sales manager for Cutting Edge Technologies. It has eight coupons from the store listed on the main screen, and if customers are interested in more coupons they simply touch the area marked "More Coupons from Area Merchants." Customers can then view 20 additional coupons that can be instantly printed out.

These coupons are displayed on the screen 10 at a time on two different pages and are rotated to give all advertisers equal time at each location on the page. There is no limit on the number of coupons that can be printed out.

"The return on most direct marketing, especially coupons, is an average of 1.5 to 3 percent. So for every 100 coupons that go out, if you get three back that is a phenomenal return. We are getting 60 to 70 percent average, and we have had it as high as 83 percent," Gentry said.

Precise tracking allows Cutting Edge technicians to show how many coupons are being printed and redeemed. Advertisers using Q-Bot receive an e-mail telling them how many of their coupons were taken out of each kiosk.

The deal

Retailers housing the Q-bot sign a one-year licensing agreement with the option to renew with Cutting Edge. Bob May, co-owner of Q-bot, said stores are not charged for the machine. Machines in the store's entry display the store's logo and are painted to match the location.

During Q-bot's first month at a store, Cutting Edge greeters show customers how to use the machines in an effort to make checking Q-bot a habit before entering the store.

Leslie Day, co-manager at the Apple Market in Rogersville, said they have had the Q-bot for about eight months. Day said the coupons allow the store to sell certain items easier when they are not listed in a flyer. He added that customers seem to take more time to look around the store for the coupon specials.

"I don't know if it saves us any money on advertising, but I think it helps build our profitability base," Day said. Having coupons from local businesses available at the store also develops a good working relationship with neighboring businesses, Day said.

Costs

Advertisers placing one business-card size coupon in the machine are charged an introductory fee of $495 for a three-month period. The fee is the same no matter how many coupons are printed, making for low production cost with high viewership, Gentry said.

"What you are typically looking at (with regular advertisements) is a production cost of 3 to 5 cents per piece that you mail out and a minimum of 17 cents of mailing cost on each piece," Gentry said. "Because of the beauty of this program, there is no production cost; it is printed out as needed. It doesn't matter how many coupons get printed out, it doesn't cost (advertisers) any more, it just lowers their per piece cost overall."

Coupons in the Q-bot also can be changed daily or even hourly based on the advertiser's need. Changes can be made in just a few minutes by accessing the main source.

"Someone could call us right now at 10:15 a.m. and say, I need to change my copy' then by 10:30 it will be changed in the kiosk," Gentry said. A team of graphic artists and technicians keep the Q-bots up to date at all hours.

Another perk to the program is a 20-word audio advertisement that is played while coupons are printing out. Advertisers can tailor the audio advertisement to meet their need.

"It's the best of every world here you have a print medium, you have a voice medium and then you have the graphic on screen which is full color, so you can have a real nice advertisement," Gentry said.

Future plans

May said the Q-bot idea is spreading, and he has received calls from companies in Alabama and California that are interested in the product. Final negotiations are under way for a Q-bot system throughout Texas.

Cutting Edge hopes the Kmart test market will propel Q-bot into other markets nationwide.

The Ozark Price Cutter will be the first store in the supermarket chain to sample the Q-bot, and more Price Cutter stores are expected to add the device in the future.

May said Cutting Edge is in the process of licensing a variety of companies and people to represent Q-bot in their own communities across the nation.

"Ultimately, we want to have a network of all of these computer kiosks operating. Then we can vend our products to national manufacturers," May said. "There are 300,000 brand products that we believe would be interested, if we had a large enough network, in putting coupons in these systems."

Cutting Edge opened a Springfield office at 305 E. Walnut Street in the Vandivort Center April 10. The Branson-based company has its headquarters at 110 Adams Street. Cutting Edge specializes in Internet service, marketing and Q-bot.