Ticketed events like movies, concerts, and sporting competitions were one of the many things that went on hold as the world responded to the COVID-19 pandemic. Stats show that revenue from event ticket sales fell to $16 billion worldwide in 2020. In 2019, the number was more than $58 billion.
As we begin to ease Covid restrictions, ticketed events seem to be making a comeback. Projections are already placing ticket sales for 2022 at $72 billion. While that means a huge boost for many industries that were crippled by Covid, it also means a huge potential for the kind of fraud that can often be associated with event ticket sales.
To push back against fraudulent purchases, many ticket sellers are transitioning to new technology that, while not always as convenient, ensures that the credit and debit cards that are often used to purchase tickets are genuine and that they secure user data.
Making EMV technology the new standard
Credit card fraud, which is considered a type of identity theft, is on the rise. The nearly 400,000 reports of credit card fraud filed in 2020 marked a 44.7 percent increase over 2019 numbers. In 2021, reports show that 11 percent of consumers were victims of credit card fraud.
One of the key vulnerabilities that contributes to credit card fraud is the outdated technology known as the magstripe or swipe card. Magstripe cards store data on a band, or stripe, of magnetic material that is affixed to a plastic card. In the late 1960s, magstripe cards were used as identification cards. By the 1980s, magstripe cards were being used widely as credit and debit cards that allowed for financial transactions.
Magstripe cards make credit and debit card transactions easy and efficient, but they also make credit card fraud simple for thieves. Magstripe technology delivers static information that is provided by the stripe. It is not encrypted and it is not dynamic.
One method used for obtaining information from a magstripe is known as skimming, in which a device that reads and obtains the information on a magstripe is attached to a legitimate point of sale location like a gas pump or ATM. Data obtained from skimming is embedded in a duplicate magstripe and attached to a card that can then be used for a wide variety of fraudulent purchases until the user discovers the fraud and deactivates the card.
To address the vulnerabilities of magstripe cards, the financial world is transitioning to a new standard: EMV cards, or chip cards. These cards store data on an integrated circuit, rather than a magnetic stripe. The circuit and the process that it uses to authenticate transactions is much more complicated than magstripe technology, making card data more difficult to steal and cards more difficult to duplicate.
Transitioning to chip card systems
The safeguards provided by chip cards have proven to be so effective that many financial networks are phasing out magstripe technology. Starting in 2024, newly issued Mastercard credit and debit cards will not be required to have a magnetic strip. By 2033, they will be gone completely from Mastercards.
For organizations that accept credit and debit card payments for ticket sales, this means transitioning to new systems that allow for chip “dipping” rather than card swiping. While this may bring new expenses for hardware and systems and new training needs, the benefits in terms of added security for transactions make transitioning well worth the costs.
The good news is that online platforms are available that work with chip card readers to allow organizations to sell tickets efficiently and securely at virtually any location. When these platforms not only process transactions, but also gather user data and store it securely, they can help organizations to manage customer relationships in a way that not only boosts tickets sales, but also assists in fundraising, merchandise sales, virtual engagement, and marketing.
For those managing ticketed events, now is the time to take advantage of the technology that is available to better safeguard transactions and better serve customers. The time is coming when those who can’t dip a chip card won’t be able to sell a ticket.
– Mike MacPherson is Director of Sales and Marketing for VBO Tickets. Mike is a passionate, proven leader of sales and marketing, with three decades of successful experience in motivating and leading sales/marketing teams. His most recent success was helping guide VBO Tickets through the dramatic circumstances resulting in the shutdown of event venues and ticketing sales in response to safety measures from the Covid-19 pandemic.