PayPal, the online payment system owned by eBay, is slowly shifting into a universal way to pay. The payment company announced last week that it is teaming up with Home Depot to test PayPal acceptance at five physical store locations.

Users can pay using one of two methods at the point-of-sale. First, they could enter the phone number associated with their PayPal account along with a special identification number. Second, they could swipe a card that is already tied to their account. The transaction would then conducted through PayPal.

Home Depot was mum on how long the test would run or how many PayPal employees were involved in the pilot program.

"PayPal has made it clear it wants to be a player in bricks-and-mortar stores," George Peabody, director of the emerging technology advisory service at consulting firm Mercator Advisory Group, told Internet Retailer. "And they made it clear they want to play with the largest retailers."

This shift is not coming out of the blue. PayPal originally announced its intentions to gap the physical and digital worlds in a blog post last fall.

This entry was posted by Retail Pro on Monday, January 9th, 2012 at 9:52 am .

Mobile payment processors, such as the popular Square device, are enabling small retail merchants to speak with customers in a more "educated and effective way," small business and retail expert Paula Rosenblum recently told Crain's New York.

"The device itself allows a retailer to communicate with his customer in a much more educated and effective way," Rosenblum, an associate at consultancy Focus.com, said, speaking of benefits mobile payment processors have over traditional point-of-sale equipment.

Small merchants may particularly excel through the development of mobile payment processing tools. Unlike traditional credit card services, which charge monthly fees based on transaction volumes, companies such as Square generally charge a flat rate per transaction. This is perfect for retail merchants that experience bursts in revenue or sell seasonal goods and may not make enough to cover annual contracts.

Because of the portable nature of mobile payment processors, they have other advantages as well. For example, retailers could take them to conferences or events or set up point-of-sale gateways in other areas of their stores.

This entry was posted by Retail Pro on Sunday, January 8th, 2012 at 10:07 am .

With 2011 now in the books, digital measurement firm comScore has totaled up online spending figures for the two-month period between November and December. Overall, Americans spent $37.2 billion over the 61-day time frame – a substantial 15 percent increase over the same time last year.

The most money was spent, unsurprisingly, on Cyber Monday. Americans spent upward of $1.2 billion on the internet shopping day, up 22 percent from the $1.02 billion spent on the same day in 2010. The shopping day to see the biggest year-over-year jump was Black Friday, which improved 26 percent from $648 million to $816 million, suggesting that consumers no longer view the promotional day as an in-store only event.

"The 2011 online holiday shopping finished with slightly more than $37 billion in spending, up about 15 percent versus year ago," said comScore chairman Gian Fulgoni. "With brick-and-mortar holiday retail estimated to have grown about 4 percent this year, it's clear that ecommerce continues to gain market share from traditional retail due to the attractiveness of the internet's convenience and lower prices."

Overall, the top five days to see the most online spending were November 28 (Cyber Monday), December 5, December 12 (Green Monday), November 29 and December 6. Interestingly enough, not all of the promotional shopping days spurred customers into action. For example, customers spent only $1.07 billion on December 16 (Free Shipping Day), which was only the sixth-heaviest shopping day.

It's crucial to note, however, that online shopping has made giant leaps over the past two years. Americans are now shopping on the channels that make sense and are convenient to them. Whether it's online or in-store, it's crucial that retail merchants reach shoppers in a multitude of ways.

"Despite their continuing price sensitivity, consumers felt a bit more comfortable opening up their wallets this year, although this appears to have occurred as a result of a decline in the savings rate. Nonetheless, it’s clear that, at least on the basis of top line growth, this was a Merry Christmas for many online retailers," Fulgoni adds.

Merchants looking to make the biggest impact need to connect with customers through a variety of means. For example, quick response codes can bring consumers to online stores, while in-store pickup options enable brands to encourage customers to come in and shop.

This entry was posted by Retail Pro on Friday, January 6th, 2012 at 10:05 am .

Retailers based in the New England region are increasingly leveraging new technology such as quick response codes to engage prospective buyers. According to technology and marketing firm Nellymoser, at least 23 major retailers with physical presences in Boston, Massachusetts, are utilizing QR codes.

QR codes are black-and-white graphics that can be printed on physical materials, ranging from posters to actual merchandise. When scanned by specific smartphone applications, they will redirect consumers to a web destination set by retailers, including ecommerce websites, YouTube channels or social media profiles.

Of the retailers analyzed, seven put the codes on window-front displays, five put them on in-store displays, four placed them inside fitting rooms and three mounted them at store entrances and point-of-sale cash registers. Location is key – fitting rooms, for example, are relatively distraction-free areas.

"The front window not only reaches today’s shoppers, but also people who are walking past the store and could become shoppers after looking at the retailer’s offerings,"  Roger Matus, Nellymoser executive vice president, told InternetRetailer.

This entry was posted by Retail Pro on Thursday, January 5th, 2012 at 2:39 am .

Retail merchants that are paying more than mere lip service to customer service are on the receiving end of more sales, according to a new report from ForeSee Results.

The customer satisfaction analysis firm recently polled a number of consumers to see which retailers were doing the best job of meeting their shoppers' expectations. Amazon.com was the 2011 leader during the holiday shopping period, charting No. 1 with 88 points. Avon, JCPenney, QVC, Apple and VistaPrint were other leaders.

At the other end of the spectrum, Overstock.com ranked as the worst at 72 points. Gap followed closely behind at 73 points.

"Customer satisfaction is a leading indicator of consumer spending, and the bump in the Index is good news for online retailers," Larry Freed, president and CEO of ForeSee, said in a statement relayed by ABC. "Unemployment is down, consumer confidence is up, and holiday retail sales are up from last year."

Retailers looking to capture more sales this year – particularly online – need to reconsider their customer service practices. Regardless of whether they are available through desktop computers, mobile devices or brick-and-mortar stores, they should have a flexible and easy-to-understand customer service regimen.

This entry was posted by Retail Pro on Wednesday, January 4th, 2012 at 9:31 am .

Gift cards are a favorite product of many retail merchants because they ensure consumers will come back and spend that money – and maybe even a bit extra – in-store.

However, many consumers are also trading these gift cards to third-party resellers for some extra cash. December 26 is national Gift Card Exchange Day, an annual one-day event where resellers pay the highest amount to refill their inventory. It works for both parties involved – consumers get money for whatever they need, while resellers can get the cards into the hands of people who will actually use them. 

As International Business Times notes, a substantial number of gift cards go unused throughout the course of the year. Experts' estimates suggest between 2005 and 2011, $41 billion worth of gift cards will have gone unspent.

According to a separate report from the National Retail Federation, shoppers were anticipated to spend approximately $27.8 billion on gift cards for the 2011 holiday season. Digital gift cards that could be emailed to recipients made them even more popular, as they made for better last-minute gifts.

This entry was posted by Retail Pro on Tuesday, January 3rd, 2012 at 2:24 pm .

Holiday shopping may not be coming to a close quite yet – the Los Angeles Times suggests the popularity of the gift card may keep consumers coming back to stores past the traditional holiday season.

Citing a report from the International Council of Shopping Centers and Goldman Sachs, the news source notes gift card spending was up 18 percent this year, up from 14.6 percent last year and 13.1 percent in 2009. This could lead to greater in-store traffic and more purchases through January, economist Michael Niemira claims.

"Gift cards were already being seen as the likely top gift choice, above clothing, toys and electronics, before the holiday season started," the news source adds. "Demand may have picked up because of a scarcity of must-have items and soft apparel demand this year."

Many retail merchants prefer gift cards sales over other transactions because customers will frequently spend more than the amount allotted to the card, especially if they have attractive discount offers.

This entry was posted by Retail Pro on Sunday, January 1st, 2012 at 11:20 am .