Cashing in on Cashless in Stadia Environment

The theme of this article is Football Clubs, however the exact same benefits of cashless environment apply to other sporting venues including but not limited to racecourse, rugby club, motor racing circuit, tennis club, athletics club etc. In fact the German F1 Grand Prix in Nurnberg in 2009, the 2010 Football World Cup in South Africa, the Olympics in London 2012, 2014 football World Cup in Spain have plans for cashless facilities and in the case of the German F1Grand Prix have already implemented a cashless solution. To demonstrate this point Sandra Alzetta, Visa Europe Senior VP for consumer market development, said "the aim is for a cashless Olympic Games in London in 2012."

In recent times we have seen a surge in e-payments or what is now been termed cashlesspayments, but what is the cause of this gallop towards removing cash from some environments. Well that is simple ... costs savings, revenue generation and efficiencies.

There have been many types of organisations implement cashless something or other, including Local Authorities, Government, Schools & Universities, Sports Arenas and more. All have realised significant benefits including modest revenue generation but moreover cost reductions and efficiency gains. In fact one local authority have seen 60% increase over all efficiencies by issuing and entitlement card rather than paper vouchers and cheques.

Olympics 2012

The potential for generating revenue in most sectors is, as previously mentioned, modest however not so within the stadia environment where the increase in revenue for awell planned and implemented scheme can be significant. So when that is added to the benefits of holding the deposited funds and having immediate access to the transactional data the attraction for football clubs is very clear. But is this just hype or are the financial benefits of cashless stadia truly a reality? They can be if the scheme is a scheme where the closed cashless solution operates only within the stadium and club shop, and where is the "custodian of the scheme and the cashless funds deposited within it. This type of scheme could be managed by the club or the club could directly appoint a specialist organisation to manage the scheme on their behalf whilst retaining the overall control.

This approach vastly improves a business case based on income and also gives theclub in direct relationship with the supporters and autonomy over the day to day operation of the cashless scheme including the all important scheme rules, in particular the rules breakage. How the scheme is perceived by cashless the supporters will be the critical success factor in terms of customer experience for every Cashless Stadia scheme. So in the closed scheme operated by the club, the fans are truly supporting the club on many fronts not just from the terraces and with the right scheme rules the club is directly responsible for the relationship with the supporters.

If, however, the club outsource the whole process to a cashless third party then almost all of the financial benefits disappear along with the direct relationship with the supporters, but this does fit with abusiness case built around streamlining operations to just core functions. Control over the scheme operation and rules have also been passed to the third party supplier.

Also depending on the contract terms data sharing may also be less than ideal. Transactional data is extremely important for providing the club with the ability to dynamically create personalised promotions and offers to the supporters via CRM. If data is not available on demand then selling those away shirt XXXL surplus in April will be more of a blunderbuss rather than sniper approach.

On the face of it giving away all this control to a third party is not the best approach, correct? Well that depends on what the club actually have a set of requirements. If the clubs view is that they are in the business ofplaying football and achieving success on the pitch, and the operational cost of a cashless solution within their stadia is a necessary evil, then outsourcing the complete scheme is exactly the right thing to do. However if the aim is to be able to efficiently manage and nurture the relationship with the supporters whilst generating additional income from intelligent but uncomplicated use of the transactional data, then the whole outsourcing cashless scheme would be madness.

The decision to go cashless either completely or in just one section of a stadia is not an easy one to make and must be done after properly analysing the clubs overall objectives and other considerations such as the contractual arrangements with other suppliers such as caterers, etc. Then and only then can andinformed decision be made for a best fit solution and how it should be implemented to ensure the highest rate of customer delight and take up is achieved.

Cashless Stadia, what are the benefits?

Regardless of whether the clubs chooses to retain control of their cashless scheme or outsource to a third party what cannot be disputed are the common benefits.

No cash handling-there will be no cash transactions within the stadium on match days, cashing up, no more security van collections,

Faster throughput-because a cashless transaction is up to 60% can be faster than cash and 3 times faster than a credit and debit transaction the queues at the catering kiosks move much more quickly.

Improved hygiene as the catering staff will not be handling cash andonly handling food this not only removes any related hygiene issues but also enables fewer staff deliver a faster, more efficient service.

Free pricing-there is no reason to keep prices to round 50 p or pound so this enables an item of £ 2.50 be increased or decreased to improve revenue which will improve customer experience and may lead to higher sales.

Improved date-the date the transaction via POS terminals can tell who bought what, when and where in the ground which can be used in personalised promotions when processed through CRM.

The specific benefits of either a closed scheme that the club operates directly or via a specialist organisation and those of a fully outsourced scheme should be carefully considered.

What to consider when choosing a cashlesssolution!

Some of the important things to consider when making a decision on a cashless solution are:-

or Impact on the customer

or Catering/caterers

or Legal requirements and FSA rules

or Scheme rules around breakage (Poor scheme rules around refunds on lost, stolen or expired cards can even create the perception that the club, having introduced the cashless solution is now taking advantage that the fact that the supporter is now a captive audience)

or Systems integration i.e.. which systems. Point of Sale (POS), Customer Relationship Management system (CRM) as a minimum and also a Card Management System (CMS) for the more progressive multi-application smart card schemes.

or Business model for predicting payback and forecastingrevenues

or Specific benefit of in sourced or outsourced scheme

or Transaction fees

or Financial management

or On going scheme management

or Sponsorship

o Data Requirements

or Customer communications/Promotion of the scheme.

or Supplier selection

Future requirements for wider or multi-application scheme

or Technologies, barcode, contactless, dual interface for backwards compatibility maybe even NFC.

or Cash Flow Data,

Watch out for that banana skin!

Cashing in on Cashless in Stadia Environment