Credit Cards Come to Vending Machines- Students and All Consumers Beware
By Nancy Castleman, CardRatings.com Consumer Reporter
According to industry experts, cashless vending machines are coming our way, quickly. In fact, folks in Philadelphia will soon be able to use a credit card at 1,000 Coke machines. And it’s expected that by 2009, over half the vending machines in the U.S. will take credit cards.
That’s good news ... if you are a careful budgeter, spender, and bill payer. It can only make life more convenient for you -- whether you’re indulging in a quick sweet treat or making do, while you’re pacing around a hospital emergency room. Just think ... quotations like this may soon be a thing of the past:
But if you already spend more than you should supporting this industry, which pulled in over $21 billion in 2004, beware! We’re expected to spend a whopping 50% more when we can use a piece of plastic to buy snacks, soft drinks, and what-have-you from vending machines."Change is inevitable, except from vending machines." ~ Source Unknown
As Elliot Maras, who is the Editor of Automatic Merchandiser Magazine, explains,
New Ways to Encourage Impulse Purchases"The 50 percent increase in average ticket is similar to the increase seen at quick serve restaurants when card transactions were introduced two years ago, driving an almost overnight acceptance of cashless transactions by the fast food industry."
Also coming our way soon, thanks to cashless vending, will be the sale of more valuable items ... in snazzy new machines ... in new places. For example, starting this fall, Macy’s will be selling iPods and other electronics that way. We’ll be able to use our credit and store cards to quickly get the latest "must-have" gadgets from nifty-looking, "cool" machines. Oh joy!
From Elliot Maras’s point of view:
Particularly Worrisome"The fact that a prestigious department store such as Macy's is willing to have a vending machine on its premises reflects the progress that the vending industry has made on the public relations front. Just a few years ago, no department store would have considered having a vending machine on its premises. The old perception that vending machines make for poor customer relations and are associated with cheap merchandise is falling by the wayside."
Parents whose children have easy access to a "Snack Center" at school might want to be most concerned about cashless vending machines. According to Elliot Maras,
I ‘fess up to frequently frequenting the vending machines when I was in college. Yes, they had them, even then! (In fact, the fist vending machine is thought to date back to 215 B.C.)
But they weren’t in the public schools, where they no doubt already lead many a child into temptation. Still, there is some good news for parents concerned about vending machines: "better-for-you" products aimed at kids have grown by 31% since 2002, compared to only 7% for more mainstream food and drinks, according to a recent article in Automatic Merchandiser Magazine.
Three Tips for Parents
1. If you find yourself in front of a vending machine this summer with your kids, you might want to tell them a bit about "the olde days," when vending machines weren’t quite so ubiquitous. It’d be a good time to talk about convenience versus cost -- and how high that cost might end up being, if they use credit cards to buy soft drinks and then don’t pay off the bill when it arrives.
2. You can just say NO! to the use of credit cards in vending machines.
3. For young people going off to college with their first credit cards, it’s a good idea to limit their use to emergencies, only. David Hunt, the former president of AT&T Universal Card, put it this way, when he gave his daughter her first credit card:
Nancy Castleman has spent 20+ years helping people get out of debt, save money, and live better on less. Along with her partner, consumer advocate Marc Eisenson, Nancy is known for her work on mortgage pre-payment, and for first explaining "credit card math" in her often acclaimed free e-letter, The Pocket Change Investor. Find it, along with many articles from back issues, special reports, link picks, and book reviews, on her Good Advice Press Web site. You can also see pictures of her 10,000 square foot organic garden and her nine grandchildren.
But what she'd most like you to do is read about her book, Invest in Yourself (Wiley, 1998, 2001), which she wrote with Marc Eisenson and Gerri Detweiler. Nancy considers this book, which discusses how to invest your time, energy, and money to create the life you want, to be her life's work. Nancy's books have received rave reviews in leading national publications, including USA Today and Money Magazine.
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posted by CardRatings.com at 11:13 AM
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