TEST Consumers Expected To Refrain From Spending Early On In 2012
TEST The 2011 shopping season saw a significant rise in consumer credit card spending. America’s Research Group has predicted that, as a result, early in the New Year consumer spending will dip to record lows.
This holiday shopping season, consumers put more purchases onto their credit cards as compared to the previous year. According to consumer payment data tracking company First Data, 7% more shoppers pulled out their plastic at the register in November and the first half of December 2011. The recent surge in the usage of credit cards over the holidays comes after a three-year period of credit cutback as households focused their attentions on reducing their debt.
While the increased reliance on credit reflects greater consumer confidence in their own personal economic situation as well as that of the country overall, it also is a testament to the success of credit card companies in steering consumers towards spending with a credit card as opposed to a debit card.
Frenzied spending during the weeks leading into Christmas inspired the National Retail Federation to make the prediction that sales would be 3.8% greater than that of the year prior to reach $469.1 billion, a record amount. While current balances are low when compared to pre-recession levels, high interest rates make it challenging for many to quickly pay down their debt.
According to data released by America’s Research Group, 2011’s Black Friday was so tremendously successful that some 44% of Americans admitted to blowing their holiday budget. Shopping online contributed significantly to the rise in holiday credit card usage. Sales made via the Internet, the vast majority of which are credit card transactions, rose from 16% in 2010 to 26% during the 2011 holiday shopping season.
ARG’s chairman Britt Beemer predicts that, “Shoppers will cut back in a very significant way relative to January and February of the last few years,” according to online news source twice.com. In fact, ARG expects post-holiday spending to decline to some of the lowest levels as seen in years making the anticipated “retail hangover” a bad one.
“Now that those credit card bills are hitting mailboxes shoppers will cut back in a very significant way relative to January and February of the last few years,” Beemer is reported to have said in a statement, according to Supermarket News.
He went on to forecast that unless consumers are availed of significant price reductions by retailers – in the realm of 70% off – they will likely hold off on making many new purchases throughout January and February and perhaps well into the spring.
Latest Other Card News
Yesterday, on October 28, Uber introduced their new team – Uber Money. According to the official website, it is supposed to work on financial products and technologies to let their customers access, manage, and grow money easier and faster. Uber is expected to develop several new features, as well as make enticing improvements to existing […]
The results of the 2019 Debit Issuer Study, commissioned by PULSE®, a debit/ATM network, and conducted by Oliver Wyman, a global management consulting firm, show that consumer debit use has skyrocketed in the last year and will keep soaring. In 2018, the number of debit transactions increased by 6.7% reaching more than 68 billion. According […]
Some serious changes are in store for many Citi credit cards like the Citi Prestige Card, the Citi Premier Card, the Citi Double Cash Card, the Costco Anywhere Visa Card by Citi, the American Airlines AAdvantage MileUp℠ Card, and some other. The updates imply elimination of some consumer and travel benefits. The bank’s official response […]
Priority Pass is a world-known program offering its members access to over 1200 airport VIP lounges with free food, drinks and entertainment in more than 500 cities across 143 countries. The program is available to everyone who’s paid for membership, regardless of a tickets class.
A virtual credit card is a unique credit card number that is linked to your main credit card account but is different from the physical card number. The virtual credit card number allows to shop online or over the phone without using your physical credit card. The numbers can usually be used once and expire if not used. The cardholders can also delete the numbers if they want or need to.