The theme of this article is Football Clubs however this also benefits of cashless environment apply at other sporting venues including but not limited to racecourse, rugby club, motor racing outlet, basketball club, athletics club etc. In fact the German F1 Grand Prix in Nurnberg just last year, the 2010 Football World Cup in South Africa, the 2012 Olympics in London, 2014 basketball World Cup Stadia in The nation have plans for cashless facilities and in the case of the German F1Grand Prix formerly 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 classified as cashless payments, but what is the explanation for this gallop towards removing cash from some environments. Well that is simple….. costs savings, revenue generation and efficiencies.
There have been many types of establishments implement cashless something or other including Local Authorities, Government, Schools & Universities, Sports Arenas and more. All have awakened to the fact significant benefits including modest revenue generation but moreover cost discount rates and efficiency gains. In fact one local authority can see 60% increase over all efficiencies by giving and entitlement card rather than paper vouchers and cheques.
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 a well planned and implemented scheme can be significant. And once 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 closed scheme where the cashless solution operates only within the arena and club shop, and where club is the custodian of the cashless scheme and the funds deposited within it. This type of scheme could be managed by the club directly or the club could appoint a specialist organisation to manage the scheme on their behalf whilst retaining the overall control.
This method vastly improves a business case based on income and also provides each club a direct relationship with the supporter and autonomy over the day to day operation of the cashless scheme including the all important scheme rules, in particular the breakage rules. How the cashless scheme is perceived by 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 cashless process to a third party then almost all of the financial benefits disappear along with the direct relationship with the supporter, but this does fit with a business 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 surplus XXXL away shirt in April personal computer of a blunderbuss rather than sniper approach.
On the face than me 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 few requirements. If the clubs view is that they are in the business of playing football and success on the pitch, and the operational cost of a cashless solution for their stadia is a necessary evil, then entrusting the full scheme is precisely the right thing to do. However if the aim is to be able to efficiently manage and nurture the relationship with the supporter whilst generating additional income from intelligent but uncomplicated use of the transactional data, then entrusting the whole 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 and informed decision come in for a best fit solution and how it ought to be implemented to ensure the highest rate of customer delight and take up is achieved.