On average, 20 percent more is spent when attendees pay with the new wearable technology.
The Austin City Limits Music Festival in Austin, Texas, will announce this week that ACL Fest will be the latest major festival offering a cashless option for concessions and merchandise purchases.
Considering that promoters only make 15% or less of their money from ticket sales, ancillary revenues from sources like parking, merchandise and concessions are critical. As in the rest of the live business, technology is changing the way fans spend money at concerts and, right now, tech is leading live entertainment towards cashless events.
Jacob Smid, managing director of live events, North America, for EDM fest producer/lifestyle brand SFX, says cashless falls in line with other tech-driven trends like fan-facing wi-fi to social connectivity that mark the way a new generation of fans experience live music, especially festivals. “The decision to go cashless is in line with how this new generation consumes, and provides us with the ability to deliver a better fan experience overall,” he says.
On a recent earnings call, SFX revealed that when its Mysteryland festival offered a cash-less experience this year with RFID bracelets connected to cash or credit accounts, attendees spent double on merch and concessions than attendees of comparable events. Other fest producers are also in the game, with Front Gate Tickets, a division of Austin-based promoter C3 Presents, rolling out a cashless solution for ticketing clients and C3 events alike, including Counterpoint, RBC Bluesfest, Center of the Universe, and Lollapalooza, along with the just-announced program at ACL.
Both Front Gate’s and Mysteryland’s cashless systems rely on simplicity, making use of RFID (radio frequency identification) technology via the chips already embedded in the wristbands used for festival entry. Front Gate’s turnkey technology sells the tickets, scans at the gates, runs the box office and, now, operates the cashless system, reporting everything together within the Front Gate solution. When fans receive their wristband in the mail, they register for cashless if they choose, entering credit/debit card info and creating a PIN. (Card info is not stored on the chip but, rather, with the credit card company.) On-site, fans order at the counter, tap their wrist, enter their pin, and a receipt is immediately emailed to the patron. While Mysteryland was 100% cashless, Front Gate says about one-third of patrons opt in for cashless at their events where it's available.
SFX partnered with Intellitix and their Intellipay product on the RFID implementation for Mysteryland, with more than 200 points of sale (POS). “It was the first year of the festival, so the number of POS was driven more by factors such as vendors and site layout with regards to the transaction locations,” Smid says.
Beyond ease for fans, the system benefits the promoter, “including the reduction of on-site cash management and expanded analytical opportunities allowing for proper placement of product and inventory management to always give the people what then want, when, and at which location,” Front Gate president Maura Gibson tells Billboard. She adds that the impact on sales at Lolla was “significant,” with the fest experiencing substantial per cap growth year-over-year. “One-third of the increase is directly attributable to cashless,” she says, adding the rest of the increase could be be related to indirect cashless benefits like faster, more efficient ordering.
While Smid declined to release sales information for Mysteryland, he did cite “strong” per capita spending from festival goers. “It is fair to say that Mysteryland was at the higher end of the curve when it comes to other comparable festivals,” he says.