Results Show a More Robust Holiday Shopping Season Than Expected

With the 2009 holiday shopping season all but over except for some post-Christmas bargain hunting, several payments indicators show that merchant acquirers are processing more transactions than many observers expected when the season began nearly two months ago. Online shopping tracked by Chase Paymentech Solutions LLC, the nation's largest e-commerce merchant acquirer, is up for the season by 29.3% in transactions and 17.7% in dollar volume from early November through Monday over the equivalent 2008 period. Volumes were especially strong in the week leading up to Christmas, with transactions up 43.8% and sales up 36.6% over comparable year-earlier levels, though part of that increase is attributable to an extra shopping day this year. Chase Paymentech's Cyber Holiday Pulse Index monitors the daily settlement activity of 50 of the 250 largest Web retailers ranked by Internet Retailer magazine. The index picks up credit card, debit card, automated clearing house, and alternative-payment transactions at the sample merchants. Despite the plethora of forecasts that retail sales in late 2009 might be a bit better than 2008's but still weak in the wake of the recession, Dallas-based Chase Paymentech didn't go into the season with preconceived notions, according to Aaron Press, director of market analysis. That said, Chase Paymentech's e-commerce merchants are performing better than expected. “I think everybody is happy this year,” Press says. Reflecting recent reports from the payment card networks, however, Chase Paymentech also is seeing a decline in average tickets, which are down 8.9% for the season. Many economists say consumers are trimming their spending, but other forces also can pull down the average tickets of e-commerce merchants, Press notes. They include lower pricing, more free shipping, and, in some categories, consumer shifts to lower-priced media for essentially the same product, such as downloadable music versus a higher cost CD. “You've got kind of all these factors working together,” he says. Meanwhile, MasterCard Inc.'s MasterCard Advisors consulting unit on Monday reported that, “e-commerce was the big winner this year.” Sales rose 15.5% versus 2008 for the Nov. 1-Dec. 24 period, according to the MasterCard Advisors SpendingPulse, which monitors transactions on the MasterCard network and uses survey-based estimates for other payment forms. In other categories, apparel sales showed mixed results, depending on the specialty, but electronics finished the season up 5.9% while jewelry sales rose 5.6%. Luxury goods, excluding jewelry, posted a 0.8% gain over 2008 but would have been down without the extra shopping day. “Overall this year, we have seen increasing stability in spending, as opposed to the free-fall of 2008,” Michael McNamara, vice president of research and analysis for SpendingPulse, said in a statement. While the extra shopping day accounted for some of the gains, the increases were still notable because retailers held the line on prices this year whereas in 2008 consumers enjoyed “broad emergency discounting,” McNamara said. Also on Monday, Reston, Va.-based Internet market tracker comScore Inc. reported that November online sales rose 10% from a year earlier to nearly $12.3 billion.