Sluggish video game sales threaten one of the most vibrant retail categories

Throughout the course of the economic recession, the video game sector was one of the few bright spots in retail. High-profile titles such as Call of Duty and Halo repeatedly smashed sales records year after year and many analysts deemed the category "recession-proof."

But according to new data from the NPD Group, video game sales are slowing down and merchants who have traditionally relied on this product type may want to rethink store operations. Video game hardware, software and accessory sales fell 42 percent year-over-year in April, one month after a 25 percent drop-off in March.

However, analysts are optimistic that once new high-profile games and next generation hardware, such as Nintendo's Wii U, hit the market, prospects will turn around.

"I think it's a simple as that, because when we see compelling content come into the market, the games are still selling as well as ever," Anita Frazier, an NPD analyst, explained. "We just saw a lot less of this in April as compared to last year."

With many retailers already beginning to plan their holiday offerings, they may want to consider the impact of the wavering video game sector as they make purchase decisions.

Privacy is still a top concern among online shoppers

The number of consumers shopping online continues to grow, as does the amount of money they spend on purchases. But despite this, many are still concerned about the privacy and security of these transactions, according to a new report from Forrester Research.

Half of online shoppers said they were concerned with the privacy and safety of the activity, with a slim 16 percent having confidence in the trustworthiness of online-only web merchants. Even though many consumers have qualms with the security of online shopping, 71 percent of American adults said they actively shop online.

Merchants that collect information about consumers, whether it's demographic and behavioral or financial payment data, need to do a better job of being transparent about what they do with this intelligence to make consumers want to shop with them.

"Ease [consumers’] fears by providing easy access to what information you have about them, reducing both the fear of the ‘unknown’ and letting them feel a sense of control," Forrester says.

New Zealand core retail sector tumbles during first quarter

During the first quarter of 2012, retailers based out of New Zealand struggled to keep sales up. According to data from the National Business Review, core retail sales (which excludes auto sales and gasoline) declined 2.5 percent – the biggest quarterly drop in nearly two decades.

Prior to Q1, the retail sector had been thriving, with 2011 finishing on two quarters of strong growth. A decline was expected by many industry analysts, but not this severely. Overall, the total value of retail sales (including all retail categories) is up 4.4 percent to NZ$17.2 billion compared to the same time frame last.

"The decrease is not as bad for total retail sales, mainly because of a 6.4 percent ($130 million) rise in sale of motor vehicles and parts," the news source adds. "This was, though, the only category to show a significant increase."

Across the ocean, the Australia retail sector has also been noted for its recent struggles. Many consumers located in the country are able to get less expensive prices on goods by buying them online and then importing them, which costs local retailers precious sales.

Foot traffic dips due to warm weather in April

Warm weather in April means American shoppers are spending less time shopping and more time outside, causing a slight dip in retail foot traffic over the course of the month. Compared with March, in-store shopping declined 7.6 percent and was down 2.7 percent year-over-year, according to new data released last week by ShopperTrak.

This makes April the first time in more than three months that foot traffic has declined in both month-over-month and year-over-year capacities. It's especially noteworthy that not even the Easter holiday could salvage April in terms of in-store visitations.

"Also, because March’s weather was so unseasonably warm, many shoppers took to the streets and bought their spring wears before April arrived," Retailing Today adds. "This meant that although April too experienced above-average temperatures, most consumers had already spent their shopping dollars."

However, industry professionals believe Mother's Day should boost shopping and help retailers mount a full recovery.

Retailers feeling particularly hard hit by the decrease in store traffic may want to consider launching special marketing campaigns for Mother's Day. By promoting discounts and offerings through a wide variety of mediums, retails may be able to lift sales.

Australian economists surprised as local retail sector improves in March

Retailers have long bemoaned the current conditions in Australia, with many citing enhanced competition from online sellers as a core issue the sector is facing. However, in March, the retail sector managed a somewhat surprising comeback after many analysts suggested the industry would continue to struggle.

Data from the Australian Bureau of Statistics suggests retail sales grew 3.7 percent to AU$21.23 billion (US$21.15 billion). Even after inflation, this is still a substantial gain and mirrors the revival of other sectors as well, such as private house building.

Some economists were quick to attribute the gains from normalizing food prices, rather than sector-wide resurgence.

"Heavy discounting in food prices through the quarter in a flat economy looks to have played a role here," Annette Beacher, head of economic research at TD Securities based in Singapore, told The Wall Street Journal. "We know that food prices collapsed in the quarter and that seems to be where all the retail demand is emerging."

Many Australian retailers blame the lack of importation laws for the weak sector. Consumers can simply pay less expensive prices on foreign retail websites because there is no legislation preventing this practice.

Warm weather affects retail hiring

February was uncharacteristically warm this year and retailers responded as a result, launching early spring sales and boosting staff numbers to meet the demands of consumers who were trading in their heavy winter clothes for something a bit lighter and more colorful.

This means many retailers already have the staff required for the spring rush, which drove down hiring in April, according to a recent report from Macroeconomic Advisers. Over the course of the month, 31,862 retail hires were made, compared to the 33,209 in March. Both months have been weak in terms of hiring, but Macroeconomic Advisers believes this is solely because of the influx of new hires in February.

"The Kronos Retail Labor Index edged down two-tenths to a still solid 3.8 percent in April, reflecting a moderate decline in hires and a small gain in applications," explained Chris Varvares, senior managing director and co-founder of Macroeconomic Advisers. "This was the second consecutive decline in hires, following a strong, nearly 11 percent gain in February."

Having an appropriately sized staff can make a huge difference in store operations and greatly improves the customer experience. Retailers are better off staffing up early so employees have time to learn policies before busy seasons.

Retail sales growth stumbles in April

While retail sales were still up in April, the growth of the sector wasn't as explosive as seen in the previous two months, according to a new study from the International Council of Shopping Centers.

The revenue of key retailers, such as Macy's and Costco, grew a scant 1 percent, marking the worst growth performance since 2009. This comes after months of big growth, buoyed by a recovering economy and improving employment statistics.

"The economy is growing in fits and starts, and we are seeing sales shoot up and down," said Michael P. Niemira, chief economist at International Council of Shopping Centers, as quoted by The Street. "We're in a choppy period."

Retailers are heavily dependent on consumer spending to generate revenue, so when Americans grow more cognizant of their budgets, retailers tend to suffer. The latest report suggests consumer spending tends to sway with the influx of economic news, and a month of less-than-optimistic reports may have taken its toll on consumer spending.

Free shipping is worth the wait, according to consumers

Free shipping is perhaps one of the most commonly used perks to encourage consumers to make ecommerce purchases. There is even a Free Shipping Day in December designed to get Americans to buy more goods online.

A recent study from AlixPartners highlights the importance of the promotional gimmick. According to respondents, free shipping is worth waiting for, as 75 percent said they were willing to wait five days for goods, provided they could get it for free.

In fact, when the survey asked why consumers don't shop online more often, 36 percent even said it was because shipping cost money. This was the second-biggest concern about buying goods online, with not being able to see and touch an item in person coming in first at 37 percent.

"The AlixPartners Home-Delivery Shopping Survey, which polled 1,000 adults nationwide between March 22 and 25, found that free shipping has a bigger effect on consumers' online shopping behaviors than the inclusion of sales tax on online purchases," Internet Retailer added, citing the study.

Bolstering customer loyalty with new features in Retail Pro 9

The economic recession has impacted how many retailers have done business – rather than focusing on gaining new customers, they shifted directions to better service their existing customer base. A number of retailers, ranging from a specialty store down the street to Home Depot, launched customer loyalty programs in an effort to keep their shoppers coming back and spending more frequently.

The latest release of Retail Pro 9 helps merchants to do the same, allowing them to set up loyalty and reward programs for their best customers. Loyalty programs enable businesses to maximize retention of their most profitable customers, strengthen new customer relationships, widen profit margins and improve business intelligence.

With Retail Pro 9, loyalty points are awarded and redeemed using Retail Pro's Central Server. This server processes transactions and updates in real-time, providing customers with up-to-the-minute balances at store locations, ensuring they are able to take advantage of their points at any location. Of course, it also ensures retailers don't get hit with mistakes stemming from "double-dipping" shoppers due to lag time.

The Customer Loyalty module fully leverages the power of the Retail Pro 9 system, giving customers a reason to keep shopping and providing businesses with valuable information about their guests.

Online shoppers opt for credit cards

Credit cards remain king of the payment castle, even on the internet, according to a new survey conducted by WorldPay.

Nearly seven in 10 consumers (69 percent) prefer paying with their credit cards at digital point-of-sale terminals. PayPal and debit cards followed at distant second and third places, coming in at 40 and 37 percent, respectively. Shoppers were allowed to choose more than one type of payment for the survey.

Additionally, the survey found that American consumers spend 23 percent of their disposable income shopping online, further illustrating the importance of ecommerce to any retail operation.

"Among U.S. consumers who had made an online purchase through a mobile device within the three-month period prior to the March survey, 53 percent used a smartphone or tablet to purchase clothes, 46 percent to buy books and 42 percent DVDs or online games," Internet Retailer reports, citing the research.

According to separate data from comScore, ecommerce spending has experienced double-digit increases for the past eight quarters. If retailers don't have an online website, they are likely losing out on some key sales.