Retailers Fighting Back After $5.7 Billion Credit Fees Settlement

Home Depot (NYSE: HD), Target (NYSE: TG), Macy’s (NYSE: M) and a host of other merchants and retail organizations are appealing a $5.7 billion settlement in the long-running court battle between retailers and card issuers over interchange fees.

On December 13, Visa and MasterCard agreed to settle the lawsuit filed by retailers in the U.S. District Court for the Eastern District of New York in Brooklyn. The $5.7 billion settlement is considered to be the largest antitrust settlement in history.

Walmart Gets Mobile Sales Boost Thanksgiving, Cyber Monday

Most major retailers reported increased sales this holiday from Thanksgiving through Cyber Monday, thanks in part to m-commerce.

Notably, mobile spending reached $314 million on Black Friday, out of the total $1.512 billion spent online that day, comScore found. Plus, mobile sales accounted for $350 million of Cyber Monday’s $2.085 billion in online sales.

M-commerce sales accounted for nearly 21 percent of total Black Friday online sales and 17 percent of Cyber Monday sales.

And Wal-Mart Stores’ (NYSE:WMT) executives gave thanks for the spike in mobile traffic that greatly benefited their Thanksgiving, Black Friday and Cyber Monday sales. The traffic from mobile devices to between Thanksgiving and Cyber Monday was more than 50 percent of total traffic, up a significant 40 percent from last year, according to Walmart.

Thousands of Cards Compromised at Retailers’ POS

More than 20,000 payment cards have been compromised at retailers’ and restaurants’ point-of-sale terminals and servers since August, thanks to a new malware botnet.

The tech that the criminals have used in this case is one of the first-known –and very advanced –botnets targeting POS terminals. The “infections” observed by IntelCrawler in this case allow attackers to corral large numbers of POS devices into a single botnet, Ars Technica wrote on its web site.

“The interface makes it easy to monitor the activities of infected machines in real time and to issue granular commands. In short, they are to POS terminals what ZeuS, Citadel, and other banking trojans are to online bank accounts,” Ars Technica wrote. The code helping to streamline the process has been dubbed StarDust, a major revision of the Dexter malware that targets POS devices.

Retailer Takes Customer Tracking to New Level for the Holidays

As we have discussed here before, more retailers are adding technology to track customers’ traffic and purchases in stores, from iBeacons to infrared sensors. The practice is becoming so common, in fact, that the Future of Privacy Forum estimates that around 1,000 small and large retailers are using some type of sensors to monitor the pathways their customers take throughout the store.

Macy’s is the largest and most recent example of a retailer effectively using customer tracking in an attempt to increase customers’ purchases this holiday season. In November, Macy’s installed Apple’s iBeacon technology in certain stores in New York and San Francisco, in partnership with rewards app Shopkick.

Shopkick’s shopBeacons enable shoppers with iPhones and some Android phones to have their Shopkick app “woken” up by a signal from Bluetooth transmitters when they enter Macy’s, even if their phones are in sleep mode, according to The Wall Street Journal. As a customer who has opted in walks through a Macy’s store, they might see special offers based on the products they are near, Cyriac Roeding, Shopkick’s CEO, told the newspaper

Card Fraud Linked to Fast Food Chain Costs Thousands

This is the first time we have heard of customers of a major national fast food chain being the victims of retail credit card fraud. Hundreds of victims lost thousands of dollars in October and November after thieves use malware to pull the Bojangles customers’ card information, and sold the numbers to a third party. The criminals took the scam of step further, making new cards with magnetic strips (cloned cards).

Investigators say hundreds of customers of at least five Bojangles restaurants in Asheville, Waynesville and Hendersonville, N.C., along with stores in Greenville, S.C. and western Tennessee were impacted.

Return Fraud Expected to Reach $3.4B This Holiday Season

Retailers expect to lose an estimated $8.76 billion in return fraud this year - $3.4 billion during the holiday season alone, according to a new survey.

The National Retail Federation’s (NRF) 2013 Return Fraud Survey found that 5.8 percent of holiday returns are fraudulent, up from 4.6 percent last year. Plus, a significant 60.3 percent of retailers said that the return fraud they experienced was linked to organized retail crime groups.

Customization and Conversation Is Key In Creating Omnichannel Retail Wins

Malissa Nelson, director of marketing and eCommerce at Dean and Deluca, spoke on FierceRetail's webinar, "How Retailers Are Embracing Omnichannel Strategies to Improve Customer Experience," and shared how the foods retailer connects with customers in store and online, and the number one way to get customers to trust brands.

Some Sephora Customers Banned from Online Shopping

This is the worst time of year for beauty retailer Sephora to make it difficult for its shoppers to buy their products, but that is exactly what is happening.

Some shoppers in Sephora’s VIB Rouge customer loyalty program – dedicated to customers who spend at least $1,000 per year – have been banned from online purchases. On beauty blogs, the VIB Rouge customers report that banned them from making purchases after they placed too many orders.

Bomb Threats New Scam in Prepaid & Gift Card Fraud

Like two peas in a pod, the holiday season rings in an increase in gift card fraud. Gift cards are being purchased in stores and online in record numbers and criminals see this as a prime time for skimming and online card fraud.
Consumers loaded $112.3 billion onto gift cards in 2012 alone, according to Mercator Advisory Group, representing a lucrative windfall not only for retailers but also for thieves.
A very serious gift card scam that developed this year involves phoning in bomb threats in an attempt to force retailers to hand over prepaid cards’ identifying information.

Cyber Monday E-Commerce Sales Shatter Records, Led by Mobile

Numerous retail organizations and research firms predicted that there would be a significant rise in holiday shopping via mobile devices this holiday season, and it turns out they are right so far. Early reports indicate that Cyber Monday’s overall online sales topped $2 billion, shattering last year's U.S. e-commerce record of $1.465 billion.

Plus, 18.3 percent of all online sales across the 2,000 major retail sites that the Adobe Digital Index 2013 measures came from tablets or smartphones, an 80% increase over last year.

Mobile traffic exceeded 17 percent of total online sales, an increase of 55.4 percent over 2012's Cyber Monday, according to IBM Digital Analytics data. Retailers catering to smartphone and tablet users benefited the most, with mobile traffic accounting for 32 percent of site visits, a 45 percent rise from last year.

Why Amazon Prime Air is a Bunch of Hot Air

It is retailers’ shortest holiday shopping season in years, so cue the ridiculous publicity stunts. That is what I thought soon after Amazon (NASDAQ: AMZN) CEO Jeff Bezos made his grand announcement about delivery drones – which are years away from being utilized – on “60 Minutes” the day before Cyber Monday.

But hey, Amazon is not the only one. Kmart launched the earliest holiday TV campaign this year on September 9, in an effort to promote its layaway program for holiday gifts.

It’s not that Amazon’s delivery drone idea is absurd. It’s just that the grand scale in which it was announced – with such curious timing – allows the e-commerce giant to be the butt of jokes and parodies, which it has this week.

How Should Retailers Handle Bad Web Reviews? Not Like KlearGear

Negative online reviews have been a problem for retailers since they began selling items online. Bad ratings on third-party review sites such as Yelp and TripAdvisor along with Amazon and shopping sites can literally cost businesses thousands or millions of dollars in lost sales.

In fact, 80 percent of online shoppers have changed a purchase decision based on a bad online review. That amounts to an alarming amount in lost sales and damaged reputations. Some retailers and hotels have taken matters into their own hands, suing the review sites over lost sales and damaged reputations. In one case, an owner whose hotel was listed at the top of TripAdvisor’s “Dirtiest Hotels in the U.S.”, sued TripAdvisor for $10 million.

A New Way to Prevent Card Data Security Breaches

All retailers and any business that processes payments should have a new document on hand that is meant to prevent and mitigate some of the millions of dollars in losses from card data breaches annually.

When the Payment Card Industry (PCI) released its updated Data Security Standard 3.0 earlier this month, it said that companies should create a data flow diagram showing all the individuals, systems, and applications that have access to cardholder data. This idea first came about, PaymentsSource reported, after a hacker produced a color-coded scheme showing where sensitive data was stored at his targeted organization.

“In the majority of compromises we’ve seen over the past few years, the merchant was trying to do the right thing but was unaware that cardholder data existed in a location that was not being protected. What these compromises have demonstrated is the business value for having a clear way to identify where the cardholder data is in your organization,” Troy Leach, chief technology officer for PCI’s Security Standards Council, told StorefrontBacktalk.

Can E-Commerce Save Flailing J.C. Penney?

On the brink of obscurity, J.C. Penney Co. Inc. (NYSE: JCP) executives finally have a reason to hold their heads up. The struggling retailer produced positive growth of 24.3 percent from its e-commerce division during the third quarter, rising to $266 million. However, this news arrives at a time of great uncertainty within the company, as they are being removed from the S&P 500 Index in favor of the S&P MidCap 400. The S&P decision comes as no surprise, since J.C. Penney continues to turn in quarterly losses, resulting in plummeting stock prices.

How One Shopper Stopped Card Fraud at Walmart

I’m sure all retailers wish their cashiers were more vigilant in catching credit and debit card theft at the time it occurs. But who really expects shoppers to be aware of card fraud in progress and alert stores to what is going on? That is exactly what happened at a Walmart store in American Fork, Utah, last week. A woman waiting in line to check out happened to stand behind two men attempting card fraud.

Free Shipping, Ease of use to Boost Holiday E-Commerce Sales

Apparently, retailers’ extensive prep work – including shoring up their fulfillment and shipping processes – will pay off in online sales. Holiday e-commerce sales are expected to soar 15 percent this year to $78.7 billion, according to numbers released this week by Forrester Research. The Forrester projection is somewhat in line with other researchers’ estimates: EMarketer, also projects that U.S. holiday e-retail sales will increase 15.1% this year, while Deloitte LLP predicts a 12.5 percent to 13 percent increase in U.S. non-store sales, which primarily consists of online sales.

New Tech Stops Card Fraud Through Mobile Phones

We think that a new tech, which compares the physical location of a cardholder’s mobile phone against the location of the ATM or point-of-sale (POS) terminal where the card is being used, will significantly reduce credit and debit card fraud.

How Will Fraud Impact U.S. Bitcoin Regulation?

U.S. regulators this week tackled the tough issue of regulating virtual currencies such as Bitcoin. The Senate Committee on Homeland Security and Government Affairs heard from Justice Department officials, who say they need help regulating digital currencies as well as Bitcoin proponents, who say the government should stay out.

Bitcoin’s global popularity has been soaring, and its value jumped to $900.98 for a single bitcoin this week. Bitcoin can be purchased and exchanged for standard currency, such as dollars, euros and yen, at bitcoin exchanges, but bitcoins have fluctuated wildly in value.

There are almost 12 million Bitcoins in circulation, giving the currency, a market value of nearly $8.5 billion.

Bitcoin advocates say that virtual currency could transform economies in developing countries where people have little access to banks and financial services. The software for creating a Bitcoin "wallet," allowing a user to send and receive bitcoins, is public and can be used on a mobile phone, USA Today reported.

ISIS Launch Boosts NFC Payments

When it comes to mobile payments by consumers, you have a tale of two worlds. At least that is where the mobile payments marketplace was in the past. On one hand, operators could utilize NFC (Near Field Communication), which boasts approximately 400 million NFC-enabled devices and hopes to grow to an estimated one billion by 2016. On the other hand, you have Bluetooth devices, which account for around three billion devices annually.

Now, the future has arrived and the two options may soon be one and the same. In an unprecedented move designed to secure a brighter future in the world of m-commerce, both of these mainstay entities have developed an alliance.

Address Changes: A Growing e-Commerce Fraud Tactic

Changes in customers’ shipping addresses is one of the key ways that thieves are now getting away with online credit card fraud, financial experts say.

Changing addresses in hacked credit card accounts provides a way for thieves to receive delivery of goods purchased with stolen payment card accounts, Julie Conroy, an analyst at financial services research and advisory firm Aite Group, told Internet Retailer.