Online purchases are up, and so is credit card use. The Nilson Report published a report by Global Credit Card Brands this week which revealed that debit and credit cards with the American Express, MasterCard, Visa, Diners Club, UnionPay and JCB logos made 135.33 billion worth of transactions in 2011, a 12.1 percent increase over 2010.
David Robertson, publisher of the Nilson Report, commented that the results of the study” reflect a continuation of the worldwide movement from cash and checks to payment cards, both debit and credit.” This meshes with the recent study by The Pew Internet Project and Elon University in which sixty-five percent of industry experts agreed that cash could be extinct by 2020.
Shopping Shifts Away from Stores
Persistent worries about internet security and credit card fraud don`t seem to be a great deterrent to customers who are eager to avoid brick-and-mortar stores and do their shopping online. Even among older people, who are traditionally more reluctant to shop online and more concerned about fraud, online commerce is rising. The younger generation, those who do not even remember a time when the internet didn`t exist, will be used to conducting business online and through mobile phones and they are the ones who may see a cashless society within their lifetime.
Making Online Easier
Meanwhile MasterCard recently released a survey which they commissioned from Harris Interactive, asking 2,229 people about their online shopping experiences and opinions. About three in five of them (58 percent) responded that they would like to store all their account information in one secure location that they could easily access it in order to make purchases online.
Most of those surveyed said that “entering payment, billing and shipping information” was one of the biggest drawbacks of shopping online. The only thing they dislike more is the fact that when shopping online, they don`t know how things look in person or how clothing fits.
Geoff Iddison, an executive in the e-commerce and mobile department at MasterCard, said of the survey: “Online and mobile shopping puts a host of new options at consumers` fingertips, but the current checkout process needs improvement . . . research shows that consumers want a simpler, faster way to enter account information, so they can spend more time searching for exactly what they want and less time filling out forms at checkout.”
Abandoned Carts and Mobile Shopping
Some of the other survey results showed that fifty-three percent of American adults shop online with their mobile phones, at the same time that they said security is one of their biggest concerns. The convenience of mobile shopping seems to outweigh any concerns about security.
Filling up a virtual shopping cart and leaving the site without checking out and actually buying the items is another widespread practice, as online shoppers find it easier to be fickle via web than at an actual store. Almost twenty-five percent of shoppers admit to doing this on a regular basis – at least once a month.
Mobile shopping and online shopping, though they both involve “card not present” transactions – defined as any transaction that takes place without a customer having to actually hand a credit card to a salesperson – are two distinct things. Consumers who are comfortable shopping from their computers may still not have gotten the hang of shopping via cell phone. That will likely change fast as more and more people become adapted to using smartphones for everything from shopping to checking bank balances to calling their mothers.