5 Ways Health Clubs Can Prepare for Payment Technology Trends

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The year is ending, but the Daxko Payment Services team is already looking ahead to next year. I recently read through Accenture’s The Future of Payments: 10 Mega Trends. It has some great information but it isn’t targeted to the needs of the health and wellness industry. So, to distill this list into what it means for our customers, here is a countdown of the top 5 ways next year’s “mega trends” will affect you and your health club, Y, or J.

NUMBER 5: IT’S ALL ABOUT THE USER

Just as the health club landscape is innovating to provide high-end services and exceptional experiences while taking fitness classes or ordering a smoothie, payments is innovating to make user experiences quick, seamless, and visually appealing. This is true both for the end user, the member, as well as your staff. From providing a paperless membership process to accepting payments with mobile devices, these innovations not only save time and frustration for members, they reduce back-office clutter and waste. You’ll see these trends emerge in the membership process and for online and in-person payments from your members. In addition to offering more seamless payments capabilities, the user experience for staff accepting those payments will become more and more important.

NUMBER 4: STAYING AHEAD OF THE CRIMINALS

The unfortunate reality is that just as payment technology companies are innovating, fraudsters are getting more innovative, too. It’s more important than ever to stay ahead of the curve in security updates. At Daxko, we have an entire team dedicated to security to ensure our customers can rely on us to maintain the highest levels of security preparedness.

With the fraud liability shifting from card issuers to merchants, EMV compliance and secure credit card terminals are more important than ever for all kinds of clubs, gyms and wellness centers.

NUMBER 3: GENERATION Z

If you’ve been struggling to accommodate and appeal to millennial members and staff, you better prepare yourself. Generation Z (those born around 1995) is coming and according to Accenture, they’re projected to make up around 40% of consumers by the year 2020. Probably the most notable attribute of Gen Z is that they are the first generation made up of completely digital natives. This generation has never known a world without Google, Facebook, Apple and they rely heavily on mobile technologies, including for payments.

Gen Z relies on digital tools to make their live simpler, like apps that look up discount codes automatically or those that offer instant person to person payments. So, as this generation comes of age, we can expect the trend towards mobile banking and payments to accelerate and the move towards purely digital wallets to take a firm hold.

NUMBER 2: TREAT YO-SELF

Just as Gen Z isn’t afraid to use digital tools to save money at online checkout, they’re not afraid to switch around their cards to get better rewards. It’s important for health clubs, Ys, and other fitness centers to take steps to mitigate the effect different rewards cards can have on their overall rates. Daxko helps mitigate this for customers by creating a detailed analysis for each Daxko Payment Services customer that includes their personalized mix of card types. This allows our payments customers to proactively account for and offset these increased costs stemming from different card mixes.

NUMBER 1: HOLD ON TO YOUR HAT

Payments used to be a relatively stagnant world, but like many other industries it’s being disrupted by younger generations and the pace of new technology. Ten years ago, next-day funding was practically unheard of and now the trend is moving towards same-day funding.

Innovation in the payments industry is constantly evolving and that won’t slow down in 2018. You need a partner that knows your business and is committed to tackling these trends as they happen. Daxko is constantly investigating and investing in future technologies and incorporating what makes sense to the health and wellness industry.

To learn more about how Daxko can prepare your organization for the future, contact us with the form on this page.

The Hidden Costs of Credit Card Declines

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Credit card declines are more than just a headache for your business and your members. They negatively impact on your bottom line. First, there’s a fee per decline which typically ranges between $0.06-$0.08. Then there’s the labor cost to your staff who are spending countless hours tracking those members down to update payment information. And finally, there’s the lost membership revenue that comes from members who decide to terminate their membership when you reach out to update payment information. Those costs can really add up!

Use this calculator to see how invalid and expired card declines are impacting your organization.

proactive card account updater will reduce the number of declined cards, preventing decline fees and drastically cutting down on staff time  spent contacting members regarding invalid and expired credit cards. Wouldn’t you rather their time be spend on more meaningful activities to your organization?

Preventing declines also keeps members from leaving. Contacting members regarding returned payments from expired or invalid cards often triggers member termination. We have found that 1 in 3 members will leave within 30 days of this happening. Think of all the future membership revenue you prevent from walking out the door when you never have to have those conversations in the first place.

Interested in how Daxko Payment Services can help improve your bottom line and member retention? We’d love to talk you.

What’s in it for me? An overview of Daxko Payment Services.

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When we launched Daxko Payment Services it was with the knowledge that we could provide better payment services options for our customers and the results we’ve seen thus far have proven that out. So, what are the advantages that Daxko provides?

An Integrated Model of Payment: By creating a service with an integrated gateway and processor, Daxko Payment Services allows the Daxko Payment Services team to have visibility, access and control to allow seamless and efficient service throughout the payments process for our customers and their members.

Creating Daxko Payment Services for our customers also offers customers these benefits:

  • Single Point of Service – Questions about a card decline? Or, wondering why a deposit didn’t hit the bank when expected? Daxko Payment Services offers our customers one point of contact (the Daxko Team) for all questions about payments. Be integrating our payments, we now can provide our customers the award-winning customer service they’ve come to expect when dealing with all types of payment processing questions or needs.
  • Transaction and Batch Visibility – Daxko Payment Services offers an online portal with payment history and visibility to allow customers to troubleshoot with their members. For example, the online portal allows Daxko Payment Services customers to search by last 4 digits on a card to find a member that was double-billed quickly.
  • Next Day Deposits – We know that any transaction closed in Daxko Operations or in Daxko Spectrum by 5pm CST will be deposited the next day.
  • Integrated EMV Compliant Terminals – Daxko Payment Services provides our customers true point of sale capability integrated with the software application.
  • Proactive and Automatic Account Updater – This card account updater service avoids CC declines for invalid expiry dates or invalid account numbers. Daxko Operations or Daxko Spectrum customers will sometimes see a monthly draft fail due to an invalid expiration date. Staff is then required to call the member and explain that they were unable to run the card because it expired. Then one of two things occurs, staff time is spent getting updated card information and getting it into the system or the member will realize that they aren’t using their gym membership as much as the used to and they will terminate their membership.

The numbers prove how valuable this service has already proven to be:

CURRENT STATE:
Across Daxko in 2016, we saw 379,246 preventable declines due to invalid expiry dates or invalid account numbers. Those declines were worth $29 million (not including future revenue lost on long-term membership value).

Based on Daxko Operations and Daxko Spectrum data, we know that 1 in 3 members that have a card decline based on one of the reasons mentioned here will terminate their membership within 30 days.

So, across our products, that equals 113,172 terminations. Just a single month of that revenue loss of $8.7 million.

Imagine taking those numbers for members stayed one, two, six months or even longer at your health club, YMCA, JCC or fitness center.

REVENUE PROTECTED:

So, what happens when we add Daxko Payment Services Proactive Account Updater? Our data show that it updates around 40% of card data. Across Daxko with card account updater we could see 35,268 declines prevented, worth 3.48 million for one month and $41.76 million annually

The difference between Daxko Payment Services card account updater is that it is “proactive” and “automatic.” because it automatically checks the card numbers prior to draft day. It is automatic, secure, and most importantly is proactive. No manual intervention required. It runs automatically every month in the background. In addition, there is robust reporting in both Daxko Operations and Daxko Spectrum.

Since we launched Daxko Payment Services Proactive Account Updater, we’ve proactively updated more than 100,000 cards. If we use the same math as we did previously, we’ve prevented more than 40,000 declines, more than 12,000 terminations and retained more than 6 million in revenue.