Dynamic pricing, micro payments, digital wallets, virtual currencies, and frictionless transactions will transform the way that fans spend — and the way franchises profit. Artificial intelligence(AI) will enable venues to offer increasingly compelling seating offerings. Example: Your favorite hockey team’s arena offers tickets in a section populated exclusively (for tonight at least) by 100 transplanted New Yorkers under 30 who attended ACC schools. You can pay for your ticket — and beers at the game — with HockeyBucks, the league’s own digital currency.
Dynamic ticket pricing and seat assignment
Custom currencies built on the blockchain technology underlying Bitcoin
Traditional middlemen in ticketing and payments — ticket brokers and credit card networks, and eventually regulators and central banks — face obsolescence.
Increasingly efficient and fraud-proof payment methods mean more of the value of sports tickets and merchandise will remain with venue owners and fans.
Never in the history of the payments industry has there been a time of such disruption and opportunity across regions. Digital technologies will upset the competitive order and the role that payments play both in the operations of businesses and in the daily lives of consumers.
John Henry Clippinger
Founder, Berkman Center for Internet and Society Law Labharvard University; Research Scientist, MIT Media Lab Founder, ID3
With the evolution of location-based technologies, mobile payment systems, and a continual decrease in technology costs, this concept of truly frictionless commerce is quickly becoming a reality. The Internet of Things is bringing Amazon’s 1-Click ordering experience to sports venues everywhere.
Digital wallet payments enable our fans to engage and transact with us in a more fluid manner. There’s a lot of friction at the sports arena — battling traffic, distributing tickets, waiting in line. Payments is one of them. You have to pull out your wallet, deal with change or credit cards. One-click technologies minimize the friction. And we’re focused on minimizing friction points wherever we can.
Chief Marketing Officer, Sacramento Kings
In the spring of 2014, the Kings became the first professional sports franchise to accept Bitcoin as payment.
Dynamic ticket pricing has already drastically expanded who attends games. Fans can pay what they want, as often as they want, sitting as close to the action as they can afford. The result is sold-out stadiums, with plenty of cheaper tickets available and an overall revenue increase of 7%.
AI ticketing takes this one step further: You set your preferences, but you don’t actually know which seats you will get until shortly before the game. The ticketing system will maximize your desires for you. Because the new sales platforms (think Facebook) have much more detailed data about you than old outlets, the experience represented by your ticket can be customized in a variety of ways. Want to sit near Facebook friends? The system can do it. Want to send 35 employees to the game as a reward? They no longer have to sit in the nosebleed section in order to sit together. Want to be near other families? Want to go with the guys and actually meet single women? The system can handle it all. All the various reasons people have for wanting to attend the game can be isolated, packaged, and priced according to demand.
Already, the total value of loyalty programs in the United States is a $165 billion annual virtual economy.
When you enter a casino, you don’t spend cash. You trade your cash for casino chips, and then you use the casino chips. As the line between real currency and virtual currency becomes ever more fluid, it will be the same way with your favorite sports team or league.
Fans will both buy and continuously earn affinity points convertible into virtual currency. They’ll be able to wager these points during games, earn more by promoting the game on social media, and spend some on a better bat for their video game star avatar.
Though it is the most high-profile digital currency to date, Bitcoin is almost certainly NOT the payment technology most fans will end up using, at least not directly. Bitcoin transactions take seven minutes, on average, to clear the system’s multi-party verification process. Nor is Bitcoin optimized for individual micropayments (the legendary low processing charges only materialize for large or aggregated transactions). Instead, the future lies in new layers of payment processing technology built on top of Bitcoin — essentially private currency networks. Between any two customers on these private networks, transferring money is instantaneous and free, or close to it.
The race is on to determine which of the new payment-service providers will become the VHS of cryptocurrency and which will become the Betamaxes. Currently, BitPay and Coinbase are the early Visa and American Express of the burgeoning Bitcoin processor industry.
Predicting the Future
Move to Digital
Smartwatches and mobile devices using fingerprint technology become hugely popular for payments — not because they save money but because they’re more convenient and secure from fraud. This lays the groundwork to move all tickets to digital form.
Paper Tickets Go Away
Paper tickets go away. Apple bypasses credit cards, establishing its own banking technology.
End of the Line
The end of the line: The only time fans will stop moving is when they’re sitting in their seat or using the rest room. Lines disappear, and event attendance and revenues increase.