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The campus card factory: Time for a new business model

10 strategic questions that every administrator should be asking
University Business, May 2017

Most Institutions of Higher Education (IHE's) have issued plastic Campus Cards for decades based on a 30-year business model.  Perhaps it is time for administrators to review this process in light of current technology and dramatic shifts in generational expectations.  Development of a contemporary business model, which may include migration to a "virtual" Campus Card, should include greater customer-focus, advanced technology and closer alignment with evolving institutional priorities.  This strategic process has the potential to save your institution millions of dollars as well as provide significantly increased student satisfaction.

Pick A Card

The first electronic card system for dining halls was pioneered by Gary Lorenz and John Darjany at California State Polytechnic University in 1972.  A decade later, a major milestone was achieved in 1985 with the introduction of the All-Campus Card (non-patented) by entrepreneurs Joseph Pietrantoni and Robert Huber at Duke University.

The All-Campus Card was developed as an strategic business solution to outdated, costly and erratic customer service practices at many campuses.

The consumer value was immediate - a single card, multiple campus privileges, durable to last 4 years, FLEX accounts, no expiration date, and issued by a centralized Campus Card Service Center.

Thirty years ago, Fall registration was more reminiscent of an annual scavenger hunt.

●   Most institutions issued 50 to 150 forms of campus identification – most of which were only valid for a semester or an academic year.

●   Antiquated technologies: OCR, bar codes, punch cards, paper tickets, labels, stickers, single-track magnetic stripes, proximity fobs, and metal keys.

●   Single-application systems and databases were managed by a variety of non-affiliated departments and all updated manually on a daily basis.

●   Students were required to stand in endless lines – with many offices and lines closed during office lunch hours.

●   Some Institutions issued "dumb" campus cards – requiring students to stand in more lines to have department privileges individually activated.

●   Cumulative costs of these parallel processes were often hundreds of thousands of dollars per year (i.e., labor, materials, equipment, support, utilities, warranties).

The overall effect of these decentralized practices generated frequent student complaints - provoked by inefficient, costly and often indifferent customer service.

The introduction of the All-Campus Card concept, Campus Card Service Centers (One Stop Shopping), immediate applications activation, FLEX-ible spending accounts for all campus venues, and eventually online advance payments, all revolutionized and simplified the Fall registration process.

Within a decade, thousands of IHE's introduced a Campus Card program, eliminated many student lines, greatly reduced overall institutional direct and indirect costs, and increased student service, convenience and customer satisfaction.

Generational Shifts

Historians concur that the generations that have had the greatest impact on modern society are the Baby Boom and Gen Y - better known as the Millennials.

Marketing to Millennials has become an overwhelming challenge to most business sectors – especially Institutions of Higher Education.

Baby Boomers (1946-1962) have continued to leave their imprint on society throughout their lives.  From disposable diapers to electronic toys, loud music, eccentric clothing, revolutionary politics, mini-vans, organic food, fitness clubs, anti-aging cosmetics, alternative medicine, and active retirement communities.

However, the Millennials (18-34), which compose most college students, have also surpassed the Baby Boomer population in North America.

Since their birth, Millennials were anointed by their overly protective "Helicopter" parents with an inflated sense of entitlement.  More than 50% of Millennials still live at home (age 30), have little interest in home purchase, 50% do not own an automobile, 25% do not have a driver's license, and most prefer public transit, UBER or Zipcar.

Most Millennials have never entered a bank, written a check, licked a stamp, and 80% have never eaten a BigMac.  Their lack of political involvement can be traced in part to not owning a television and therefore not as impacted by traditional TV advertising.

Millennials most commonly travel in flocks, rather than pairs, and routinely text others before making decisions.  

Highly educated and tech-savvy "Mobile Millennials" own several digital devices and often make dining decisions based on mobile charging outlets or WIFI access.  Battery chargers at home are usually in their bedroom – so they will never miss the latest text or Tweet (24/7).  They avoid credit cards and prefer non-banking FinTech digital payment applications.  In the past year, the VENMO app was used for 25% of Millennial dining expenses.

Ironically, student union and campus dining managers report finding smartphones in clear sight on a daily basis.  Apparently, if students "lose" their phone, followed by an emotional call to their Helicopter parents, they can be guaranteed their personal crisis will be resolved with a new gifted smartphone.

"They're the RIGHT NOW generation", as described in the latest "Mindset List" (Class of 2020) by Beloit College, but with increasing anxiety levels.

For the "Mobile Millennial", their smartphone is an extension of their personality.  Most of all, Millennials don't like waiting in lines … or waiting for anything.

Campus Card Factory

Over the past 30 years, the centralized issuance of a single plastic Campus Card has become a cultural membership card of a college or university – especially on residential campuses.

Technology has experienced seismic advances, including electric cars, ATMs, international banking, wireless phones, Internet, Cloud, websites, email, texting, eTickets, Facebook, LinkedIn, Twitter, social media, smart watches and smartphones.

During this period, campus card operations changed as well – but primarily technologically.

Mainframe refrigerator cabinets and later micro-computers were replaced by PC-based card systems.  Miles of card reader data cables and rented telephone lines were replaced by plug-in Ethernet networks.  Manual floppy discs (5¼") were replaced by automatic backup systems with infinite storage.  System manuals were replaced with Help Screens.

Suitcase Polaroid cameras, photo die cutters and hot laminators were replaced with portable card printers. Large micro-wave size readers have been replaced by small credit card readers and downloadable applications to iPads.  Traditional keyed residence hall doors are being systematically replaced by hotel-type electronic locks.

Even the business model for campus card system providers has essentially shifted 180 degrees from past decades.  Whereas providers formerly designed, installed and supported only their own brand of proprietary computers and card readers, companies now specify or resell international brand computers, financial industry and security readers.  Most system vendors no longer manufacture plastic cards in-house, but broker them to international card service bureaus.

Paradoxically, in recent years an increasing number of "stealth" door access systems have surfaced on campuses – often installed by decentralized housing offices.  Most utilize antiquated proprietary technology (e.g., proximity), often require proprietary credentials (e.g., fobs), and are not controlled by Campus Police in case of a campus emergency (e.g., shooting, lock-down).  Clearly, these rogue systems do not conform with Best Practices, are not cost-effective nor in the best interests of most institutions.

Although card production has been reduced from 20 minutes to 20 seconds, most campus cards still use 70-year old technology (i.e., bar codes, mag stripes).  Many campus cards include embedded smart chip technology but which continues to be plagued with ongoing technological, proprietary, security and cost issues.

Over 200 colleges and universities, as well as campus dining contractors, have been piloting smartphone apps for dining and door access venues for over three years – with no major business issues, and most importantly, enthusiastic acceptance by Mobile Millennial students.

During the past decade, most students upload their photos, change meal plans, add funds online, and correspond with the Campus Card Office electronically via email, text, Facebook or Twitter.

So why do schools continue to produce plastic Campus Cards and in-house?

New Business Model

The consolidation of diverse forms of campus identification and proprietary departmental systems was revolutionary and has proven to be a very successful business model for over 30 years.

Major generational shifts and technological advances have set the stage for a paradigm shift by administrators focused on increased campus safety, enrollment, retention, marketing and financial resources.

Higher education has been revolutionized with online college catalogs, online registration, online password changes, online classes and distance learning.

Other than upgrading campus card system technology, most institutions have not formally assessed their Campus Card operation – including how to best serve their "Mobile Millennial" customers.

Decades ago, all campus card questions had to be answered by employees in-person (or telephone).  Now responses to most questions are available 24/7 via the Internet or on a program website.

Just as public telephones and residential party lines have become technological dinosaurs, the smartphone has become the contemporary extension of the Mobile Millennial student and their personality.

Hotels nationwide are now replacing hotel guest cards with a smartphone app which they can activate en route and never stand in line at the front desk during their stay.

If the Transportation Security Administration (TSA) now accepts smartphone credentials from millions of airline passengers everyday, why not extend that same technology and privileges to your students and employees?

We would suggest that all campuses assess their current infrastructure and begin to offer their Mobile Millennial students and employees a "virtual" campus card which can be accepted for campus verification, financial and security privileges.

With virtual credentials, lost cards are no longer an office expense or a customer inconvenience.  As with online academic registration, replaced phones becomes the online responsibility of the student or employee via a website or smartphone app.

For special groups, plastic badges can still be produced (off-site) overnight via card service bureaus – saving considerable overhead, training, equipment, inventory, card stock and printer supplies associated with traditional in-house card production.

Administrators need to consider whether it is time to shift their institutional resources from operating a 30-year old "Plastic Card Factory" to a virtual Campus Customer Service Center via a 24/7 website.

Other than program marketing and reader maintenance, service centers should be able to reduce their overall expenses by at least 75% by issuing a virtual credential.

Is your institution well positioned to respond to these business infrastructure challenges and new campus marketing opportunities?

We recognize that there are no "cookie cutter" solutions.  However, to begin the inquiry process for consideration of a new business model for your institution, we have included the following Strategic Questions - That Every Administrator Should Be Asking.

The Baby Boom and Millennial generations have both changed the world and the culture at institutions of higher education.  The next generation is about to decide whether to attend class … or just send their drone instead.

Strategic Questions

Every administrator responsible (directly or indirectly) for a Campus Card program should be asking the following institutional strategic questions:

1.   What if our campus card vendor is sold?

2.   Is our campus card website contemporary and mobile-ready?

3.   Why do we still need residence hall student laundry readers?

4.   Why do we still need to purchase vending machine readers?

5.   Is proprietary vendor hardware (still) a wise investment?

6.   Should we "leapfrog" over Contactless to mobile technology?

7.   Why are we (still) making campus cards in-house?

8.   When will we make plastic campus cards optional?

9.   Why are we issuing plastic cards vs. virtual credentials?

10.   What is our plan to convert all campus readers to mobile-ready?

Robert C. Huber is a certified vendor-independent Strategic Planning Business Consultant, publisher of the "Campus Card Industry Business Forecast", author, entrepreneur, visionary and frequent conference speaker. He can be contacted via Huber@AllCampusCard.com.

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