A new report from the Federal Reserve suggests consumer debt skyrocketed during the fourth quarter of 2011, which may lead to a growth in new sales.

Total consumer debt jumped at an annual rate of 7.5 percent during the fourth quarter of 2011, suggesting economic growth is comprised mainly by borrowing. After shrinking 2 percent the previous quarter, credit card debt leaped by 4.5 percent to $801 billion. The resurgence of auto sales edged non-credit card debt up to 9 percent, and overall, consumer credit increased from $19.3 billion to $2.5 billion, CBS News reports.

The fact that consumers are breaking out of recessionary habits and spending more indicates they are growing increasingly confident in the economic recovery of the country. This is particular evident by their willingness to make long-term purchases, such as automobiles. Furthermore, the trend outlined in the Federal Reserve report has continued thus far into the new year.

"Consumer confidence is so far running ahead of economic reality. All this spending has yet to be reflected in the economy. Initial government figures show the nation's GDP grew at an anemic annual rate of 2.8 percent in the last three months of 2011," the news source adds.

The Federal Reserve report further echoes a separate release from Visa. The credit card company announced that profits rose 16 percent in the first quarter as consumers used their debit and credit cards more frequently. This is particularly noteworthy considering the recent legislation that capped swipe fees in the United States – the area from which Visa makes 56 percent of its revenue.

In fact, the company upgraded its 2012 outlook, forecasting revenue growth in the low teens or high teens, as opposed to the single-digit figures it predicted last year.

This clearly highlights the value of point-of-sale software solutions that still accept credit cards. While mobile payments gained traction in 2011, with the launch of several near-field communication payment platforms, credit and debit cards remain the top way for consumers to pay for goods and services at retail merchants. Retailers would be wise to offer the option to pay by credit card in some way or another.

This entry was posted by Retail Pro on Thursday, February 9th, 2012 at 2:50 am .

Apple's iPad has already made its way into the hearts of many consumers, now the technology company is hoping to do the same with retailers. According to a recent report from Aruba Networks, approximately 56.2 percent of retail merchants plan to be using iPads to bolster their in-store efficiency.

Associates using the tablet devices will be able to browse retail websites, sign customers up for loyalty programs and reward initiatives, perform point-of-sale software tasks and accomplish other key goals. The iPad isn't the only piece of Apple technology infiltrating retail outlets – 38.5 percent also plan to issue iPhones to associates in an effort to accomplish the same goals.

"Today every other shopper walks into a store carrying a smartphone and increasingly using them for price comparison," Manish Rai, Aruba Networks' head of industry solutions, told Internet Retailer. "With an e-retailer with cheaper prices just a click away, bricks-and-mortar retailers are looking to differentiate in-store service to retain customers."

Several retailers have already integrated iPads in some capacity. For example, Moosejaw Mountaineering began leveraging the devices to help shoppers locate items.

This entry was posted by Retail Pro on Wednesday, February 8th, 2012 at 2:33 am .

Retailers concerned by the safety of online shopping platforms have little to worry about. According to a new survey by CyberSource, the online fraud rate hit a 13-year low in 2011, declining from 0.9 percent in 2010 to 0.6 percent.

While fraudsters didn't manage to steal as much, they were more prone to target big-ticket items. In fact, total dollar values were up – criminals stole approximately $3.4 billion from U.S. and Canadian e-tailers last year, an increase from the $2.7 billion pilfered in 2010. Luxury good sellers should take note and ramp up security on their ecommerce platforms.

"The continued growth in ecommerce is a welcome development for merchants and the economy overall," says Andrew Naumann, CyberSource's senior business leader for fraud management solutions. "The bad news is that fraudsters took in a higher dollar volume, the first such increase we've seen since 2008."

Given the rampant growth of ecommerce – more than $35 billion was spent over November and December 2011 alone – it's vital that retail brands have some sort of online shopping platform in place. They just need to look out for suspicious activity to avoid being scammed.

This entry was posted by Retail Pro on Wednesday, February 8th, 2012 at 2:31 am .

After the dry month of January, retailers once again have holidays they can look forward to. This month, it's Valentine's Day, and Americans are looking to spoil their friends, family and other loved ones with gifts in celebration of the holiday.

A recent report conducted by the National Retail Federation and BIGinsight found the average consumer will spend $126.03 on Valentine's Day gifts, up 8.5 percent over the $116.21 they doled out last year. Despite the relative uneasiness of the economy, Valentine's Day 2012 will be the biggest one in the past decade in terms of consumer spending, with budgets expected to exceed $17 billion.

"As one of the biggest gift-giving holidays of the year, it's encouraging that consumers are still exhibiting the desire to spend on discretionary gift items, a strong indication our economy continues to move in the right direction," said NRF president and CEO Matthew Shay. "Anticipating high foot traffic in the coming weeks, retailers have replenished their inventories."

Men tend to spend the most on Valentine's Day presents, with the average male expected to pay for more than $168.74 worth of clothing, jewelry, greeting cards and other related merchandise – nearly twice as much as the $85.76 the average woman will spend. Across the broader consumer base, couples are anticipated to spend $74.12 on their significant other, $25.25 on their children or parents and $6.92 on friends.

"Celebrated by children who give Valentines to their teachers and classmates, family members who make sure to send greeting cards across the miles and couples who wish to show their appreciation for each other, Valentine's Day means more than what's simply on the surface," said Pam Goodfellow, consumer insights director at BIGinsight.

When shopping for these gifts, discount retail stores will be the go-to place: 37 percent plan to purchase their Valentine's Day gifts from brands of this variety. Meanwhile, 33.6 percent will go to department stores, 19.3 percent will shop online and 20.2 percent will hit specialty stores. Floral shops, jewelry stores and clothing stores were also popular shopping destinations.

Valentine's Day will offer a breath of fresh air, with many retailers not anticipating strong sales until later this spring. According to a separate NRF report, container shipments will remain flat until spring, suggesting retailers aren't expecting big sales until then.

This entry was posted by Retail Pro on Tuesday, February 7th, 2012 at 2:39 am .

While many retailers have a Facebook or Twitter profile, few are conducting adequate customer service through these social tools. Long response times, unanswered questions and other customer service missteps were among some of the key pitfalls CMO.com noted in a recent survey.

This isn't an issue relegated to smaller, understaffed retail merchants either. Across the entire sample, 64 percent of brands didn't answer questions or respond to complaints, and among this group were major chains such as Costco, Kroger and Kmart.

"Unlike traditional customer-service channels, every complaint and response in Facebook and Twitter is completely public. Follow-up comments from the original, now much angrier, customer and empathetic responses from other fans can undermine the first impression of a brand for page visitors," CMO.com notes.

Conversely, well-respected retail brands frequently had quick response times. A recent customer satisfaction report from The E-tailing Group found that top 10 retailers all had response times of less than three hours.

This entry was posted by Retail Pro on Tuesday, February 7th, 2012 at 2:36 am .

North American retail brands need to be sure they have some sort of anti-shrink and theft plan in place. Globally, shrinkage cost retailers $119.1 billion in 2012 – approximately 1.45 percent of total retail sales, according to new data collected by the Center for Retail Research.

Shrink remains the biggest threat to merchants in North America and Europe. Theft was up a total of 6.6 percent in 2011, an increase CRR believes stems from the still-struggling global economy. Customer theft, ranging from shoplifting to organized retail crime, accounts for the majority of shrinkage at 43.2 percent worldwide. Employee theft, however, was a big issue in North America, making up 44.1 percent of shrink – even greater than shoplifting.

"Internal error and administrative failure, such as pricing, process, or accounting mistakes, accounted for 16.2 percent of total shrinkage, compared with 16.9 in 2010 and 16.4 in 2009. Suppliers/vendor fraud accounted for 5.6 percent of total shrinkage, compared with 5.4 in 2010 and 5.6 in 2009," the research notes.

Given the slow post-holiday time frame, now may be the ideal time to develop new anti-theft policies to help curb shrink.

This entry was posted by Retail Pro on Tuesday, February 7th, 2012 at 2:35 am .

Retailers using quick response codes on flyers, posters and in-store shelves may see an increase in consumer activity. A new report from ScanBuy suggests the number of people scanning these codes has shot up dramatically over the past year and will continue to do so through 2012.

ScanBuy registered more than 31 million scans worldwide in 2011, marking a significant 297 percent increase over the 7.8 million scans registered in 2010. More than one-third of these engagements – 11 million – came in the fourth quarter of 2011, which means consumers were scanning these codes more actively as the year drew to a close.

"Thousands of marketers are using [the] platform to create, manage and track their QR code activity," Mike Wehrs, president and CEO of Scanbuy, told Internet Retailer. "They range from local businesses up to Fortune 500 brands like Coca Cola, Home Depot and Starbucks."

This shouldn't surprise any retail merchants – the number of smartphone owners in the United States jumped from approximately 60 million at the beginning of 2011 to 91 million by the close of the year, meaning the potential audience grew significantly.

This entry was posted by Retail Pro on Monday, February 6th, 2012 at 2:46 am .

Efficient ecommerce platforms, prompt customer service and quick shipping are three factors that have elevated retailers above their competitors, according to a new customer satisfaction from The E-tailing Group.

Ballard Designs, Tiffany & Co., Williams- Sonoma and Wine.com were among the top retailers recognized by the survey, which uses mystery shoppers to rank and rate ecommerce merchants. Retail brands in the top 100 had the average customer service response time of 31 hours and four delivery days. On the other hand, top companies responded in 20 hours and shipped in less than three.

"These merchants understand that customers gravitate to sites with front-end efficiency and back-end speed in support and logistics," E-tailing Group president Lauren Freedman says. "Delivering a swift online shopping experience has become the ticket to retention."

This study should show retailers where they could improve their online shopping services. Response time is key – whether they are answering inquiries or shipping packages, it's absolutely crucial for merchants to be prompt.

This entry was posted by Retail Pro on Monday, February 6th, 2012 at 2:43 am .

While recent reports from the National Retail Federation have suggested retailers are gearing up for a slow winter season, one product category is standing out as being particularly lucrative: Licensed children's toys.

Through the end of 2011, licensed toy sales were up in terms of dollar sales by 2 percent and represented 26 percent of total industry sales, the NPD Group reports. Retailers bank on the sales of these products, as they cost 57 percent more than toys not based on popular licenses, such as Power Rangers or Ninja Turtles.

"The overarching story for 2011 was that consumers made purchasing trade-offs. When they did buy toys, compared to last year they purchased more higher-priced toys at the expense of mid to lower-priced ones," said Anita Frazier, industry analyst at The NPD Group.

Overall, approximately $21.18 billion was spent on both licensed and non-licensed toys in 2011.

The report comes just weeks before the annual Toy Fair, an event where big-name toy manufacturers show off their product lineups for the upcoming year.

This entry was posted by Retail Pro on Monday, February 6th, 2012 at 2:42 am .

Everyday, the impact of smartphones and web-enabled cellphones on purchasing habits can be seen – when consumers are looking around stores, they can frequently be seen looking up products on their mobile phones. Now, a common fear has arisen among many brick-and-mortar retailers: Consumers will use these devices to find better prices elsewhere.

A new survey from the Pew Research Center suggests that actually isn't always the case, perhaps allowing retailers to breathe a sigh of relief. In fact, more than one-third of the time (35 percent), consumers do purchase the item they were researching on their phones. Conversely, only 19 percent opt to buy the product online and 8 percent purchase the item from another store.

In fact, consumers frequently don't even use their phones to research prices on the web. When Pew asked respondents what they used their mobile devices for as they shopped, 38 percent revealed they called their friends to ask for advice. That said, one-quarter (25 percent) responded that they did look up prices online while in-store, and 24 percent searched product reviews.

"These findings show that the growing availability of smartphones and other mobile devices has dramatically changed the shopping experience," says Aaron W. Smith, a Pew senior research specialist.

"Consumers are frequently using their phones to make sure they get the most highly-rated product at the best price, and in many cases they are willing to go elsewhere or delay their purchase until they find the right combination of value and quality," Smith added.

Of course, younger consumers – the ones who tend to be on the bleeding edge of technology – are the most likely to use their mobile phones to research products and services. Nearly two-thirds (63 percent) of consumers between the ages of 18 and 29 use their mobile devices while they browse retail shelves. Conversely, only 36 percent of consumers between 50 and 64 utilize their phones for the same purpose.

Younger consumers are also more likely to compare prices – 38 percent of 18- to 29-year-old shoppers check prices elsewhere on their phones, while only 16 percent of those between 50 and 64 did the same.

The key is embracing this new technology rather than fearing it. Have a mobile app and implement price-matching policies to keep these shoppers from going to competitors.

This entry was posted by Retail Pro on Monday, February 6th, 2012 at 2:39 am .