It’s the season of spending, and already records are being set on the e-commerce side of the scale. Beyond the dollars being transacted – and debt being accrued – the holiday shopping experience seems to be shifting, both in-store and in the digital realm.
Although e-commerce is clearly catching fire, 88 percent of Americans will still visit actual stores for their holiday shopping. However, this does not mean they’re not still using digital payment methods. In fact, early estimates from Adobe Analytics found that shoppers buying online and picking up items in-store grew 65 percent from last year. “Converting mobile traffic to sales has long been a thorn in the side of retailers, but investments in making the experience faster and easier have paid off,” said Taylor Schreiner, director, Adobe Digital Insights, in the release.
What this tells us is that holiday shoppers are no longer partial to just one payment method: they are shifting towards omni-channel payments. And for retailers and credit unions, this is good news. According to the National Retail Federation (NRF): “Multichannel shoppers outspent single channel shoppers by about $93.”
The holidays are a good example of the rise of omni-channel payments. As you continue to monitor your members’ spending this holiday season, pay attention to which payments they’re using and when.
We’ll be sharing some statistics on Black Friday/Cyber-Monday shopping among our credit unions and their members next week.
In the meantime, enjoy this week’s 5 must-reads, dedicated to the growth of omni-channel holiday spending.
PwC: Mobile Payments a Big Part of Holiday Shopping 2018
According to PwC’s 2018 Holiday Outlook, smartphones will be the payment “vector of choice” for 24 percent of shoppers; wearables will account for 16 percent (double what they were last year). While mobile payments are clearly on the rise in the U.S. – particularly among millennials and Gen Z consumers – our stats are modest compared to China’s. There, 95 percent of the country has used mobile payments, compared to 42 percent of U.S. consumers.
More Retailers Go Cashless in Time for Holidays
In an effort to cut costs – and deter theft – a handful of major retailers have gone cashless this holiday season. “They include clothing retailers such as Bonobos, Indochino, Everlane and Reformation; Amazon bookstores; Casper Mattress; Drybar hair styling; The Bar Method fitness studios; and United and Delta airlines (both at ticket counters and for in-flight food and drinks),” according to USA Today reporter Paul Davidson. What are the pros and cons of going cashless for retailers – and, maybe even more to the point, consumers?
The Evolution of Point-of-Sales Systems
The shift to digital isn’t just happening on the consumer side; merchants are also evolving their point-of-sale systems to create an omni-channel experience. Google Local Ads are a great example of this. Google gives shoppers an easy way to find available products from retailers near them, and then place an order for in-store pickup. This sort of experience is made possible by open APIs, something that many see as the next evolution of the omni-channel payment space.
If You Hate Traffic, Curb Your Love of Online Shopping
From the Department of Counterintuitive Facts: The online shopping we do to avoid crowds and traffic at the mall is actually creating more traffic. Between Thanksgiving and New Year’s, the U.S. Postal Service, Fedex and UPS expect to haul about 2.1 billion packages – up more than 10 percent since 2016. What’s the impact? “McKinsey estimates trucks alone will be responsible for $34 billion a year in urban congestion costs by 2020, up 20 percent since 2014.” The solution, according to one professor of civil engineering, is for shoppers to factor environmental cost into their omni-channel payment experience. Adding environmental-consciousness to the payment method decision doesn’t really sound scalable… but it give you an opportunity to save some money and rethink that purchase!
Stay tuned for our credit union Black Friday/Cyber-Monday spending analysis coming soon.
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