The power of plastic: a key forecaster shares his vision for the campus card. Are you ready for the changes? - Trend report: campus cards

University Business, July-August, 2002 by Jean Marie Angelo

It's wiser to market the campus card and what it can do. Students have a lot on their minds, which is why they need reminding that their campus card is good for buying books at the bookstore, or a pizza at the fast-food vendor on campus, says Huber. More card administrators are following the lead of schools such as Ohio State, which advertises the benefits of its campus card in college newspaper ads and in promotional brochures available at information tables in the student union.

There's revenue in those transactions. With more card activity comes more account deposits, which means more revenue for the campus-card program. Huber points out that a card program can earn interest--albeit modest interest--on the money parents and students deposit into a program's interest-bearing general-ledger bank account. (These are the funds students draw on when they use their campus cards.)

But there's other revenue to be realized in transaction costs, the analyst says. Local merchants who accept the campus ID card for payment should pay commission to the school for the sale. Duke University, for one, has arranged for 15 commercial vendors to accept its campus card for payment. Students can use the card at the campus McDonald's, but can also use it to pay for food delivery from the Domino's Pizza and Subway. Each sale yields a 20 percent commission to Duke's Auxiliary Service Office. With annual pizza and sub deliveries totaling $1.9 million, commission revenues could add up to $380,000, say school officials.

The campus ID cord will be used to open more doors. Administrators are understandably far more conscious of campus security than they were a year ago. They are paying much more attention to who gets in and out of administration buildings, which means that a student's campus ID card may be used for daily access to many more places than just a residence hall, predicts Huber. More campuses are expected to install electronic access readers at campus library entrances, student unions, and recreation centers, he says.

Wireless apps will emerge. So far, there's talk about wireless apps, but nothing concrete, says Huber. Still, the day may be coming when schools install wireless devices to help with micro-security issues. Students, for example, might gain entrance to their dorm rooms by swiping a card that's read by a wireless reader located on the same floor. Access to the campus bus system might be set up in the same way, with a swipe that's read by a wireless device placed on the bus.

The magnetic-stripe cord remains king of the campus, at least for now. Its popularity is driven by economic realities, says Huber, for it remains cheaper to produce than a chip card (a.k.a "smart card"). Sure, chip cards with student data stored within can lessen the burden on a campus-card system and may help reduce administrative costs, says the analyst, but the cost to produce a chip card is still about $7 versus 75 cents for the mag card, says Huber; that's why the mag card's still king.