The Player Card System Revolution
Data Rich, Cost Saving Cashless Systems
By George McAuliffe, President, Pinnacle Entertainment Group
Ten years ago, we were evangelists for “debit” card systems. In our columns and speaking engagements, we spread the word and shared the immensely positive results. No longer. We don’t have to. The contribution of such programs to the modern-day arcade is undisputed. The player card revolution is just that, a revolution. It is taking the “coin” out of “coin-op” systems! Incidentally, I’ve dropped the term “debit card” and use “player card” instead these days to differentiate what our fun centers use from bank debit cards.
Player card systems have truly arrived. Here are a few reasons why:
• Technology: The cost has dropped, the quality and capabilities have risen, operating cost savings are greater.
• Widespread consumer acceptance: We’re riding a societal shift to a cashless economy with debit cards as our favorite vehicle!
• Pricing and marketing: When tokens were the medium of play, our options were limited when it came to pricing and marketing. Player cards give us tools to finesse the perceived value of the arcade experience, tripling the average play price in recent years.
• Labor: The costs involved in stocking, selling, collecting, counting and reporting token and game sales is reduced to a fraction of what it used to be when using player cards instead of coins.
• Data Management: We can analyze everything the player card system touches –– games, guests, time, spending, employee activity and more.
• Enhanced management of group sales and birthday parties: A huge contributor to the success of any FEC, group events and parties are much more easily packaged and managed with player card systems. Customer loyalty programs are also enhanced and simplified.
• Efficiency: Conversion from paper to e-tickets adds cost savings, reduces waste and provides a positive societal result.
• Reporting is tremendously improved: Many system providers offer quality reports capable of slicing the data any way an operator could want. This gives us the intelligence we need to manage the business without spending valuable management time to collect it. Systems provide better information in real-time and leave management with more time to fine-tune operations.
Our industry is blessed with a good number of suppliers of such player card systems. At last year’s Bowl Expo, we led two sessions of a seminar titled “FEC, Games & Redemption,” drawing 600 hundred people combined. Our informal survey of the crowd found that about 80 percent featured player card systems in their centers and the large majority of those users ran either Intercard or Embed.
That surprised me. Companies like Sacoa, Coin Tech, Ideal and Core Cashless have solid systems and have served FECs for a long time. There is also Semnox, Amusement Connect, and more recently, Tigapo competing for their share of the cashless system market for amusements.
Our company recently teamed up with Intercard as our strategic client for card systems and point of sale, so we’re not exactly objective. We find them to be the best solution for us and the facilities we advise. The POS and card system are very critical to any FEC and, in my opinion, no vendor choice is more important.
While you might arrive at a different final selection, here are the main criteria we used to make our choice:
• Track record: You need a company that has demonstrated its stability and ability to deliver changes in technology and reliability over time.
• Experience: Closely related to track record, what we mean here is specifically arcade and FEC experience, understanding our world and what we need.
• Innovation: The marketplace evolves and a card system is a long-term investment. Players want, and expect, the arcade world to keep up.
• Service and support: It all begins with training and installation early on, then continues with consistent reliability.
• Product features and dependability: You need solid products with operator- and customer-friendly features that work.
• Reporting: Data is a key management tool. Just having it is only half the battle. It’s how it is accessed and organized that is critical.
• Pricing and marketing features: There are tremendous opportunities to impact the business in these key areas.
The Next Frontier
As great as player card systems are for arcades of a certain size, smaller arcades and route locations with a few games each were left out of the revolution. That is rapidly changing.
Cost was always an issue for smaller arcades. They have fewer games to amortize the cashless system’s central infrastructure and software costs. Companies have figured out how to drive that cost down. We think Intercard is again leading the way here with their new iTeller Element system priced as low as $12-15,000 depending on the number of games. Element is designed for smaller arcades and is backed by their experience, support infrastructure, report packages and the other services developed over 30 years in our industry. At that price, we think we’ll see the next big expansion of systems in our industry.
Embed has had their EmOne system in the marketplace for some time and it is a solid solution, though priced higher (in the mid-$20K range).
The route side of the business has cashless solutions as well. PayRange, for example, makes an easy-to-install device that allows operators to take mobile payments on their machines and includes a suite of marketing services.
Heartland MicroPayments has its WaveRider solution for route operators, letting them add debit card, credit card and mobile payments to their machines. Also serving this segment of the industry is Amusement Connect, a company co-founded by operator Frank Licausi with products that work in FECs and route stops. In the same price range as Intercard’s Element, their system seems to have some interesting features, including a tie-in to Gamer Green, the online redemption solution owned by Bay Tek.
By the way, online redemption is a parallel technology development for our industry. The ability to shop and redeem online is in its infancy, but in our view, is the next wave for arcade redemption. Combined with the spread of the player card revolution to smaller arcades and routes, this next phase will be fun to see!
Aha! Moments – Scott Sherrod
“In the year 2000 before I was the CEO of Intercard I had an Aha moment to apply cloud-based technology to solve the woes of the customer before the cloud was even called the cloud. I am an avid follower of technology and I like to be ahead of the curve. I spent hundreds of hours at customers sites early on in my career to understand the business needs of the operators so me and my team of developers could build a system to cure their woes. Now the cloud is a go-to solution for all software offerings everywhere. Intercard was the first to release cloud-based technology in the amusement industry in 2003. This technology dramatically lowered the costs of the software and software maintenance. That’s an Aha moment that I’m proud of!”
George McAuliffe has helped hundreds of business large and small develop and execute arcades and FECs. He has personally operated family entertainment centers from 2,000 to 150,000 square feet as a corporate executive, entrepreneur and consultant. With his partner and son Howard, he launched The Pinnacle Insider to help a wider audience execute FEC operations at a higher level. Readers can become an Insider at ThePinnaceInsider.com.
George lives on the Jersey Shore with his wife, Julie, and has a passion for passing along what he’s learned in the fun business to the new generation of operators and suppliers.