KHD Buzz – Retail Sales Drop in May, US Consumers Expect Inflation to Worsen and More
Unexpected Drop in US Retail Sales for May
In May, retail sales in the United States fell more than predicted, as car sales fell and record fuel costs caused people to cut back on spending on other things.
Retail sales dipped 0.3 percent last month, down sharply from April’s downwardly revised 0.7 percent growth and the 0.9 percent first reported, according to the Commerce Department. May’s figure was also the first drop in five months. Bloomberg had polled economists, who predicted that the newest report would show a 0.1 percent increase. Read More
Apple’s Pay Later Launch May Sink Other BNPL Providers
The fintech companies who pioneered the “buy now, pay later” trend have had the stakes raised by Apple’s entry into the crowded “buy now, pay later” industry.
The iPhone maker has announced intentions to launch its own “pay later” loans, adding to its already extensive portfolio of financial services, which includes mobile payments and credit cards. Apple Pay Later is a service that allows consumers to pay for items in four equal monthly installments with no interest.
BNPL players like PayPal, Affirm, and Klarna are now in an uncomfortable position. Apple, a $2 trillion firm and the world’s second-largest smartphone manufacturer, is expecting to lure Apple dependent customers away from such services. Affirm’s stock dropped 17% last week as a result of the announcement. Read More
Average American Expects Prices to Continue to Rise
According to a poll conducted by the Washington Post and George Mason University’s Schar School of Policy and Government, 66% of Americans believe inflation will worsen somewhat or significantly during the next year. Nearly 90% stated they had altered their own purchasing habits in order to stretch their budget. Read More
Report: Customer Service in the Retail Industry is Getting Worse, Not Better
According to Forrester, the average customer experience score in April was 71.3 percent, down from 72 percent in 2021. After years of climbing scores, this is the first time the score has dropped. “The changes signal to us that some organizations are either having a hard time keeping up with these consumers’ evolving expectations, or are just sidetracked by all of the other things that they need to be working on,” said Pete Jacques, principal analyst at Forrester. Read More
Target’s Stock Discounting May Spike Price War
Target isn’t the only retailer dealing with a high level of excess inventory. The expected upshot for consumers will be a summer of aggressive retailer discounting and offers for those who are feeling the pinch of rising inflation. Read More