Many event organisers are keen to get on board with RFID ticketing, attendee admission and payments, but are worried about the costs. Are these concerns justified, and how should you go about performing a cost-analysis for implementing RFID at your next event? Here are some guidelines that can help you understand the true costs and potential benefits of RFID for events.
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Consider the total cost, and don’t ignore the price of doing nothing
The first thing you need to remember is that unless you’re completely strapped for cash, “how much will it cost” shouldn’t be the main question you’re asking. Instead, you should always be thinking in terms of return on investment – how many dollars you get back for each dollar you put in.
This means that you need to weigh not just the amount of money you’re paying upfront, but also the revenue you’re generating, as well as the ‘cost of doing nothing’. In other words, there are costs to not implementing RFID and instead relying heavily on cash payments. A complete cost-benefit analysis needs to take these into account, in addition to the direct and indirect revenue and savings generated by RFID.
Nevertheless, the initial price tag is a good place to start – so let’s do that.
Direct cost factors to consider
While many of you reading this are doubtlessly expecting a single number, the truth is that such a number is pretty much impossible to give without understanding the particular circumstances of your event – which is why you’re not likely to see actual details of pricing on any vendor website (including ours).
There are five factors that will typically play a part in the quote you’ll receive, which are:
- Types of RFID solutions required: Access control is typically simpler to implement than cashless payments, which are in turn simpler than social-enabled activations; each of these will be priced differently.
- Number of attendees: RFID is most often priced at a per-attendee basis. Typically, the more attendees at your event, the less you can expect to pay for a single activation.
- Hardware: this includes the RFID accessories given to attendees – such as wristbands, badges or lanyards – as well as the devices used to read them. The cost of RFID wristbands and scanners usually depends on the number that you require, and the quality. Wristbands start from about 0.10 cents a band, and scanners can be loaned to you at an agreed daily rate (to save you purchasing your own).
- Software: An end-to-end RFID system will include an event management platform that lets you track scanned wristbands, transactions, etc. Licenses to use said software will be part of the quote you receive.
- Support and services: Will you need the RFID provider to have people ‘on the ground’ at your event, in addition to your own staff? Will remote support via phone / chat suffice? These factors could also play a significant role in the overall price of the solution.
The costs of RFID will always be comprised of the above five elements, but the specifics can vary significantly based on a multitude of factors – including the size of your event, the level of difficulty in implementation (e.g. a festival held in a remote location vs a club night), as well as shipping and travel costs .
However, as we’ve mentioned at the start of this article, understanding the “sticker price” should only be the first step in your cost analysis – and should be weighed against the indirect ‘costs of doing nothing’, and the direct benefits that RFID can generate. Let’s move on to examine these:
Indirect costs of running a cash-and-credit-card event
The initial inclination might be to to assume not implementing an RFID solution is the cheaper alternative, because you avoid all of the direct costs mentioned above. However, the alternative would often be to rely heavily on cash payments, which bears its own costs, including:
- Lost and stolen cash: with vendors handling large amounts of cash money, discrepancies are inevitable. Estimates of the amount of revenue lost due to theft and mishandling of money typically range between 3%-15% of total event revenue.
- Wifi costs: enabling credit card payments in remote or large-scale events will often require organisers to invest in event wifi – which could easily cost upwards of $20K, and still not guarantee connectivity all the time. RFID can mitigate these costs by removing the need to purchase temporary internet.
- Staffing: RFID access control streamlines attendee admittance and makes it easier and faster to validate tickets, which could often mean you can hire less people to man the gates. Assuming that you’re paying staff around $25 per hour, this saving would amount to somewhere between $500 and $5000
Looking at the above, it’s easy to see that the costs associated with not implementing an RFID solution are far from inconsequential – and can easily amount to anywhere between $20-100K, depending on the size of your event.
Revenue benefits of RFID
Now that we’ve covered the potential costs for both alternatives, we need to also look at the ‘returns’ side of the scale. Needless to say, these will also vary wildly based on the event and how successful the implementation is, but they would typically include:
- Increased customer spend: When purchases of food, drinks and merchandise are done by a simple wristband tap – rather than ‘painful’ methods such as handing over cash or swiping a credit card – customers have a propensity to spend more. Studies have placed this increased spending at 15-30% more than a traditional event.
- Higher sponsorship value: The novelty of RFID-enabled events, as well as the accurate data you collect and the ability to create branded activations, can all help you gain better sponsorship deals at your events. However, this is difficult to quantify – it could be anywhere between 5-50% more than what you would receive otherwise, depending on the data you can produce and your own savvy as a negotiator.
- Improved attendee experience: Highly intangible and difficult to quantify, but extremely valuable nonetheless, is the fact that attendees have more fun when you use RFID: they wait less in line, they enjoy better security, and they don’t need to carry cash on them throughout the event. This will translate into a multitude of direct and indirect benefits, from increased ticket sales at your next event to more favourable online reviews.
- Additional revenue channels: where applicable, an organiser can charge activation or refund fees, thus rolling over parts of the cost of an RFID event to attendees.
Taking these revenue-generators into account, it’s easy to see how RFID will often cover and far surpass its direct costs, even without looking at the price of the alternatives.
Conclusion: It’s all about the ROI
This article presented a framework for analysing the costs and benefits of implementing an RFID solution. While it’s difficult to give one general number that will apply to all circumstances, we hope you can use the above to gain a better understanding of what you can expect to pay for when considering this type of system, and how to calculate the potential benefits and the costs of the alternatives – which would mean doing nothing, relying on cash or investing in temporary internet solution.
Finally, we’ll end where we started – unless you’re completely strapped for cash, the question should never be “how much am I paying?”, but rather “what is my return on this investment?”. Adopting this frame of mind will help you fully consider the pros and cons, and have more thoughtful discussions with RFID providers.
Want to see how we apply these principles to your event? Request a price quote for Token RFID to learn how much you can expect to pay and gain at your next event.