MONEY Scams

5 Ways You’re Being Duped by Food & Drink Labels

Whiskey barrels
William Baker—Alamy

Think that "natural" food you're buying is made without artificial ingredients? Think again.

You might think that labels describing products as “local,” “craft,” and “natural” indeed mean that they’re local, craft, and natural. To a disturbing degree these days, you’d be wrong. Here are five examples of how food and drink labels can be vague, meaningless, or downright fraudulent, and how consumers are being duped as a result.

Liquor That’s “Local” and “Craft”
In a story about the emerging small-batch craft liquor trend, the Denver Post recently asked an interesting question: “Ever wonder how a brand-new distiller is offering 8-year-old whiskey?”

The answer is that the new company is buying the hooch, typically from an industrial factory in another state like Kentucky or Indiana. The truth is that often, according to the Denver Post investigation, the packaging and marketing of supposedly hand-crafted, locally produced whiskeys, vodkas, and bourbons are the only things actually concocted by the company on the label. In related news, a class-action lawsuit in Iowa against the makers of Templeton Rye whiskey received approval to proceed this week; the suit alleges that consumers were tricked into believing the product was made in Iowa when in fact it was made in an Indiana factory.

Critics say that most of the rapidly growing legions of new players in the craft liquor space are mere marketers, not manufacturers, and that they intentionally mislead buyers into thinking the booze is made in-house. Sometimes the language on labels is an indication—the words “produced by” rather than “distilled by” may be a giveaway that the brand doesn’t make its own product—while other times the labels are even more vague or simply false, and the hope is that no one really unearths the truth.

Thankfully, authentic craft liquor makers tend to be geeky types who dwell on every last detail of production and happily run through the process step by step on websites and tours. If you’re unsure about a brand and want to know more about how the product came to be, all you likely have to do is ask.

“Local” Farmers Markets
When you buy, say, kale at a farmers market, it’s reasonable to assume the kale is grown at the farm whose representatives are doing the selling. But perhaps you shouldn’t jump to such conclusions.

One apprentice who worked farmers’ markets for his employer in New England explained in a confession published by Modern Farmer that he was unknowingly selling kale that came from a farm in Georgia. The New England farm was also passing off Canadian asparagus and California salad greens as its own “local” produce at farmers markets. The confessor confronted his boss about the produce of questionable origins, and “he said that not all of it was coming from the farm, that some of it was coming from other farms, and I asked was it coming from local farms and he said some of it was not.”

Previous investigations, in metropolitan areas such as Los Angeles and Detroit, revealed pretty much the same: farmers passing off produce from somewhere far away as home grown and local.

“Natural” Foods
More and more, American consumers say that eating healthier diets is important to them. According to the 2014 Food & Health Survey, taste and price are be the two biggest reasons people purchase food and beverages (listed by 90% and 73% of consumers, respectively), but the healthfulness of what’s put inside one’s body is catching up as a key factor: 71% said it was very important, compared with 61% in 2012.

Quite naturally, many of these health-minded consumers are likely to be drawn to foods labeled as “natural.” There’s just one problem: The word means pretty much … nothing. Consumer Reports found that three out of five consumers check specifically for “natural” products, “despite there being no federal or third-party verified label for this term.” And this summer, the consumer advocacy group decided to do something about the fact that millions are seemingly being misled into believing the term “natural” only applies to foods that are made without pesticides, artificial ingredients, or genetically modified organisms.

“Due to overwhelming and ongoing consumer confusion around the natural food label, we are launching a new campaign to kill the natural label because our poll underscores that it is misleading, confusing, and deceptive,” Urvashi Rangan, Ph.D., executive director of the Consumer Reports Food Safety & Sustainability Center, said in a statement in July. “We also don’t believe it is necessary to define natural when there is already another label—organic—that comes much closer to meeting consumer expectations and is accompanied by legal accountability.”

Any Kind of Fish You’re Buying
An alarming study released last year by the nonprofit group Oceana showed that the mislabeling of seafood sold in restaurants, sushi shops, and supermarkets happens all the time. In a study covering 21 states around the country, one-third of all samples were listed as the wrong kind of fish—the “snapper” turned out to be rockfish, for instance. Restaurants in northern California misidentified fish in a whopping 58% of the samples taken, while Pennsylvania was the worst state overall, with 56% of the seafood in grocery stores and restaurants turning out to be something other than what was listed on menus and pricing labels.

Meanwhile, a series of Boston Globe stories that predate the Oceana study also showed that restaurants and supermarkets routinely mislabel the seafood they sell. Investigators followed up that analysis with another study indicating that shoppers were regularly paying too much for seafood in supermarkets because the fish weight (and therefore, price) was inflated thanks to ice being factored in during the weighing process. In all likelihood, this means that some consumers have been charged excessively for seafood for two separate reasons—because of ice skewing the true amount they were paying for, and because they were duped into thinking they were getting a pricier kind of fish.

“Craft” Beer
Blue Moon, Shock Top, and Goose Island are beer brands that claim to be authentic craft beers, and many consumers assume that’s what they’re getting. Yet all three brands are owned by the world’s two biggest brewing companies—MillerCoors for the first two, and AnheuserBusch InBev in the case of Goose Island. In other words, these brews fall under the domain of the same companies manufacturing and marketing Coors Light and Budweiser, brands that are as mass-market and non-craft as you can get.

Amid the rapidly growing craft beer craze, it’s understandable that bigger companies would try to cash in on the trend by selling brews that appear to be made with personal care and “small batch” appeal. Just as understandably, the independent craft beer community, as embodied by the Colorado-based Brewers Association, has taken umbrage at the way that multinational corporations are trying to stealthily pass off mass-produced “crafty” beers as true craft product.

Related:
That Craft Beer You’re Drinking Isn’t Craft Beer. Do You Care?
The Demise of BK’s ‘Satisfries’ and the Sad History of ‘Healthy’ Fast Food

MONEY Autos

Used Car Prices Are Plummeting. Here’s Why

Vehicles for sale at a used car lot.
Chuck Franklin—Alamy

When the market for new car sales is hot, smart buyers know to look instead at the overflowing inventory of used cars—a supply that's cheap and getting cheaper.

It’s a great time to be in the market for a used car. The Wall Street Journal recently cited data indicating that used-car prices declined for the four consecutive months through August. USA Today noted that the average used car purchased at a franchised auto dealership sold for $10,883 in August, down 1.6% from the previous year and 2.4% versus July 2014. Edmunds.com predicted that used car prices would dip around 2% overall this year, and that some used vehicles—in particular, large crossover SUVs like the Chevy Traverse—would drop in price by upwards of 8%.

What’s more, the forecast calls for used-car prices to stay on a downward trend for the foreseeable future. AutoTrader.com, the Atlanta-based online marketplace for new and used vehicles, says that its inventory of certified pre-owned vehicles has risen 6% since March, and that by year’s end buyers can expect a handful of top “pre-loved” car models—including the 2011 versions of the Ford Fusion, Toyota Corolla, and Honda CR-V—to be priced at roughly 5% less than what dealers were asking just six months ago.

What accounts for the sudden price dip? A quick review of what has happened in the new and used car markets over the past few years sheds some light. In 2011, used vehicle prices hit a 16-year high in the wake of the Great Recession, when relatively few consumers were purchasing or leasing new cars because money was tight and credit was less available. That meant a shrinking supply of used cars, as there were fewer trade-ins or vehicles coming off lease. The “Cash for Clunkers” stimulus program also removed millions of used vehicles from the market, further tightening supply.

According to Cars.com, the average 2012 listing price for five popular used vehicles five or more years old had risen a whopping 29% over the three years prior. Around that time, however, new car leases and sales surged, rising 13% in 2012 and continuing with impressive growth in 2013 and 2014. All of those new vehicle purchases and leases have translated to a parallel rise in trade-ins and cars coming off leases. “Leasing has surged in recent years with thousands of those cars coming back to dealerships as used cars,” Michelle Krebs, AutoTrader.com senior analyst, said via press release. “The abundance of returned lease cars should result in used cars coming off their historical highs of recent years, representing good buys for consumers.”

The takeaway is that used cars are cheap, at least when compared to the record highs of a few years ago, and that the market for previously owned vehicles should remain attractive to buyers through the near future.

Yet this turn of events isn’t all good for consumers. When used car prices tank, so does the value of your trade-in, if you have one. Also, automakers are more likely to offer low-price lease deals when their anticipated resale value is high. The flip side is that when used car prices crater, like they’re doing now, car dealerships must assume that they’ll be forced to sell off-lease vehicles for less money—and therefore they need to make more money from the person leasing the car in the first place. In other words, typical monthly payments for a customer leasing a new car are likely to rise compared to the rates available not long ago.

MONEY Customer Service

3 Industries That Desperately Need Customer Service Makeovers

Chimpanzee on a telephone
Brad Wilson—Getty Images

Comcast is hardly the only company that should be doing some soul searching and commit—not only with words but actions—to making customer service genuinely better.

Because the state of customer service has been bad for so long, and because we’ve heard many times over that some or another big initiative would improve customer service dramatically only to have little or no impact, we’re skeptical about the effectiveness of any broad campaign supposedly crafted to address age-old customer grievances. Nonetheless, it was good to see Comcast’s recent announcement that a long-serving executive named Charlie Herrin had been named as the company’s new senior vice president of customer experience. “Charlie will listen to feedback from customers as well as our employees to make sure we are putting our customers at the center of every decision we make,” a message from Comcast president and CEO Neil Smit explained on Friday.

Read between the lines and it sure looks like Comcast is acknowledging that in the past, customers haven’t exactly been top of mind when it comes to company decisions. That’s no revelation to consumers, of course, who have routinely dinged Comcast for terrible customer service. In 2014, Comcast “won” the annual Worst Company in America competition as voted by Consumerist readers, the second time in recent years it has nabbed that dubious honor.

While it’s unclear what Herrin and Comcast will do to improve customer service, the first step in solving a problem is acknowledging that you have one, which Smit did more squarely when he said, “It may take a few years before we can honestly say that a great customer experience is something we’re known for. But that is our goal and our number one priority … and that’s what we are going to do.” To which the consensus reaction among consumers is … it’s about damn time. Followed by, we’ll believe it when we actually see real,meaningful change.

To be fair, it’s not just Comcast that’s sorely in need of a customer service makeover. Here are three entire business categories that are regularly bashed for not putting customers’ needs first on the agenda.

Pay TV & Internet Providers
Current Comcast competitor and likely merger partner Time Warner Cable is also a regular contender for the worst service title, as are other pay TV-Internet providers including DirecTV and Verizon.

Among the complaints are that there is a lack of true competition in the category, because roughly three-quarters of Americans have exactly one local choice for a high-speed Internet provider. A survey published this summer indicated that more than half of Americans would leave their cable company if they could, and nearly three-quarters said that pay TV providers are predatory and take advantage of the lack of competition. Among the most hated pay TV practices that consumers would love to see changed are promotional rates that are replaced by skyrocketing monthly charges, frustrating and time-consuming run-ins with customer service reps, and bundled packages overloaded with channels and options the customer doesn’t want (let’s add smaller packages and a la carte channel selection, please).

Wireless Providers
The good news for cell phone users is that customer satisfaction is on the rise, increasing 2.6% according to the 2014 American Customer Satisfaction Index (ACSI). The bad news, however, is that while we’re happier with the actual gadgets (from Samsung in particular), satisfaction with the companies providing our cell phone service—including AT&T, Verizon, T-Mobile, and Sprint—remains stagnant and below average.

Plenty of other studies also show just how frustrated and dissatisfied consumers are with wireless providers nowadays. A vote-off at Ranker.com, for example, placed AT&T at the top of the list of “Companies with the Worst Customer Service.” Among the many problems consumers have with wireless providers is that choosing a handset and data-minutes-texting package is absurdly complicated, with countless permutations, obfuscations, and mysterious add-on charges. This past weekend, a New York Times columnist presented a painstaking step-by-step analysis of why the $199 price advertised for the new iPhone 6 is a joke—because by the time fees and monthly upcharges are tacked on, upgrading to the new phone will easily run more than $600.

“Wireless service has always been one of the most complex purchases a human can possibly make,” Eddie Hold, a wireless industry analyst with market research firm NPD Group, summed up in a Consumer Reports story last year. “It’s always been horrific.”

Banks
Number 3 on the Ranker list of companies with the worst customer service, just below AT&T and Time Warner Cable, is Bank of America. Another study, from 24/7 Wall Street, used customer service surveys to put Bank of America in the #1 spot for its Customer Service Hall of Shame, and two other banking institutions, Citigroup and Wells Fargo, are in the top (bottom?) 10. (The study factored in ratings for these institutions’ banking and credit card services.)

What may come as a surprise—a sad and ironic one, at that—is that customer satisfaction with banks is apparently at a record high. The 2014 J.D. Power study on U.S. Retail Banking Satisfaction indicates that big banks and regional banks have made some strides in terms of making customers happier (or less disgusted) with their service, and that overall bank scores are higher than they’ve ever been since the study has been conducted. Yet the J.D. Power study shows there’s a long way to go: The most common reason given for switching banks is poor customer service, and millennials, minorities, and affluent consumers stand out as being particularly dissatisfied with today’s banks.

“Even with record high satisfaction, there are some banks that fall far short in meeting customer needs,” J.D. Power’s Jim Miller said via statement. “It is easy for banks to become complacent. To stay at the top of their game, banks should focus on those customers who are not satisfied. And consumers should keep in mind they have the opportunity to shop banks to find the right combination of services, products and fees to meet their needs.”

What’s your pick for the company with the worst customer service? Tweet us at @MONEY with the hashtag #unhappycustomer. Here’s what readers have already said. Add your nomination, and we may publish your feedback in a future post.

Related:
5 Packages That Could Replace Pay TV As We Know It
How to Pick a Bank

MONEY Food & Drink

7 Reasons Our Coffee Habit Is Costing More These Days

dollar sign made out of coffee beans
Andrew Unangst—Getty Images

In a relatively short period of time, the American coffee habit has gotten a lot more expensive.

Monday, September 29, is National Coffee Day, when restaurant and coffee chains around the country are giving out free (or extremely cheap) cups of Joe to the masses. The day is quite the exception, however, given how as a nation we are spending more and more on coffee.

Here are 7 reasons why:

We’re drinking coffee earlier in life. A study published this year by S&D Coffee & Tea shows that on average, younger millennials start drinking coffee at age 15, while older millennials picked up the habit at 17. Typical members of Gen X, meanwhile, started drinking coffee at 19.

More of us drink coffee regularly. U.S. coffee consumption rose 5% in 2013, according to a National Coffee Association survey, meaning that today 83% of the adult population drinks coffee; 75% have coffee at least once a week.

And we’re drinking higher-priced coffee at that. Data from 2014 shows that 34% of Americans drink gourmet coffee daily, an increase of 3% over last year. Young people in particular are willing to pay higher prices for coffee: In a new PayPal poll, 18% of people age 18 to 34 said they are willing to pay more than $3 per cup, compared with just 8% of those age 50 to 64.

We eat breakfast outside the home more often. Our fast-moving, on-the-go culture has been blamed as a reason for declining sales of cereal and milk, as more Americans are skipping the traditional breakfast at home and opting for foods that can be eaten on the run, like Pop Tarts and fast food via the drive-thru. In fact, breakfast has become enormously important to quick-serve restaurants because it’s the one mealtime experiencing strong growth lately. Coffee purchased at a restaurant or on the go at a convenience store or café is always more expensive than coffee brewed and drunk at home.

One word: Keurig. “In 2002, the average price of a coffee maker was about $35,” a recent post at the Northwestern Kellogg School of Management blog stated. “By 2013, that number had risen to around $90.” Truth be told, it’s still easy to find a coffee maker for $35 or even less, it’s just that the type of machine—the traditional kind that brews ground coffee by the pot—is no longer typical. It’s been replaced by the pricier single-cup brewer that came into the mainstream over the last decade thanks to the Keurig company. For many consumers, the speed and convenience of such machines outweighs the premium one must pay beyond the plain old-fashioned coffee maker. Some 1.7 million single-cup Keurig brewers were sold in the second quarter of 2014, an increase of 200,000 over the same period a year before.

Plus, K-Cups themselves are pricier. It’s not just the single-cup machines that cost more—the cups themselves do too. The price per single-serve K-Cup pod varies widely depending on the style of roast, whether you’re buying a small pack or stocking up in bulk, and how strategically you shop for deals. But no matter how good you are at snagging deals, you’ll almost always pay more for coffee pods than you will for old-fashioned ground or whole bean coffee. One price-comparison study conducted a couple of years ago indicated that K-Cup coffee cost more than $50 per pound, roughly four times the cost of a bag of Starbucks or Dunkin’ Donuts beans. What’s more, K-Cups are subject to a 9% across-the-board price hike in early November. (Side note: Mother Jones and others have pointed out that single-use K-Cups cost more and are worse for the environment than recyclable pod filters, though Keurig Green Mountain has plans to make all K-Cup pods fully recyclable by 2020.)

All coffee is simply getting more expensive. A long-lasting drought in Brazil (the world’s biggest producer of coffee beans) has pushed global coffee prices to near-record highs, and the market may be affected for years to come. Already this year, java junkies have faced price hikes from coffee brands such as Starbucks, Folgers, Maxwell House, and Dunkin’ Donuts. Interestingly, even as coffee has gotten more expensive and economic growth hasn’t exactly been sizzling in recent years, Starbucks sales have outpaced lower-priced competitors Dunkin’ Donuts and McDonald’s. What does that show us? For the most part, coffee lovers are passionate about their caffeinated beverages and aren’t going to trade down to what they view as an inferior cup of Joe, even if doing so would save a couple of bucks here and there.

MONEY Shopping

The Creepy New Way Macy’s Tempts You to Make Impulse Purchases

A view of a Macy's flagship store in New York.
A view of a Macy's flagship store in New York. Bebeto Matthews—AP

Macy's is outfitting stores with the ability to detect shoppers' exact locations—and then make ads and coupons magically appear on smartphones so they'll buy the merchandise in front of them.

The Shopkick app was born as a combo rewards program and location-based coupon dispenser, in which users accumulated points (or “kicks”) for doing things such as activating the app inside stores, scanning barcodes of specific items, or merely walking inside a participating retailer location. The app works with tons of national retailers, including Best Buy, Sports Authority, J.C. Penney, and Macy’s and was a hot topic in the news a couple of years ago, when Target made Shopkick available for use in all of its stores around the country.

From the get-go, retail experts anticipated a time when such technology would be fine-tuned and pushed to the next level. Instead of the app displaying basic coupons and deals the moment the customer walks through the doors, more precise location-based offers and promotions would appear based on where the shopper is standing inside the store.

During the upcoming holiday shopping season, this futuristic vision of retailer marketing will arrive in a big way at Macy’s. The Washington Post reports that over the next few weeks, Macy’s is installing 4,000 special devices inside nearly 800 stores, with the purpose of detecting the exact location of shoppers—and then sending them special tempting offers accordingly.

The devices, developed by Apple, are called iBeacons, and some people have already described them as “creepy.” Macy’s began testing how Shopkick and iBeacons would work together during the 2013 holiday season. Apparently, the retailer was happy enough with the experiment to roll out the technology to all of its U.S. stores.

How exactly will the tech play out in a real-world situation? Say you’re “in the housewares department standing next to our display of KitchenAid mixers,” Macys.com president Kent Anderson explained. “The ability to transmit to you information — a video about the quality of this product, the accessories that we have as part of our assortment that you may not see there — rich content that may, and should, help us close the sale, is where we potentially see the beacon technology going in our stores.”

Presumably, if the mixer was on sale or part of some other promotion, that information would also appear on the smartphones of those using the Shopkick app. Macy’s says that “more personalized” offers—based perhaps on one’s history of purchasing or browsing in stores and online—could pop up as soon as next spring, though that may depend on how the new program plays out during the upcoming season and how welcoming (or not) shoppers are to the retailer using even more of their personal data.

Macy’s maintains that it will proceed cautiously concerning how often specific location-based ads and promotions will be sent to shoppers in stores. Going to that well too often could prove to be, quite literally, a turn-off in that shoppers could wind up turning off the app. “There is the opportunity to overload them” with special deals, Anderson said, “and I think that the balance has to be found.”

MONEY Shopping

8 Things We Already Know About the 2014 Holiday Shopping Season

Mark Cerqueria, software engineer for the application software company Smule, performs as Santa Claus
In all likelihood, Apple will have good reason to celebrate during the upcoming holiday season. Jeff Chiu—AP

Among other things, it looks like it will be a terrific holiday season for Apple, "Frozen," and workers seeking temporary jobs.

It’s still only September, and there are many unknowns about the end-of-the-year holiday shopping period. We don’t know exactly how aggressive retailers will be in terms of starting price wars with the competition, for instance, nor what the chances are of a surprise “it” toy emerging as a must-have gift for legions of American children. Still, even at this early date, it doesn’t take a crystal ball to see the way much of the season ahead will play out. Here’s what we know:

The holiday season already started. Sure, the back-to-school shopping period is considered to last through September, and autumn and Halloween are increasingly important for the marketing of everything from scary costumes to pumpkin spice lattes. But everything—everything—pales in comparison to the importance retailers place on the winter holiday shopping season. That’s why stores try to make the season a little bigger every year. Kmart launched its first Christmas ad, or rather a coy “non-Christmas ad,” in early September. And soon after, Walmart, Target, Toys R Us, and others rolled out various versions of the season’s “Hot Toy” list, long before kids even start thinking of making wish lists of their own.

You’ll be required by law to buy gadgets and “Frozen” merchandise. OK, it will only seem that way. That’s because the hot toy lists are dominated by “Frozen” products even though it’s been months since the Disney film was in theaters. When the lists aren’t directing parents to 3-foot-tall Elsa dolls, they’re steering buyers to techie items for kids like this Vtech smartwatch. Tech for adults will arguably be an even hotter category this season, what with a series of new tablets from Amazon and, of course, Apples’s hot-selling iPhones.

Stores will have longer hours and shorter checkout lines. Shoppers have come to expect the former around the holidays, with stores sometimes open for 88 hours in a row, or even longer, in the days leading up to Christmas. This year, Target launched longer hours (including midnight closings at some locations) before the summer even ended, with the hope of rebuilding its reputation as a convenient, fashionable spot to shop. What’s come as more of a surprise—and a welcome one at that—is Walmart’s promise to keep all of its checkout lines open during peak shopping hours throughout the season, starting on Black Friday weekend. As for Thanksgiving store hours themselves, experts expect big box retailers to open doors on the holiday even earlier than they did last year.

Black Friday won’t have the season’s best prices. On the day after Thanksgiving, stores will surely draw in the masses with promises of amazing discounts and doorbuster deals—but only on some merchandise. Because Thanksgiving store hours essentially mean that Black Friday begins on Thursday, because “Black Friday” sales start appearing days or even weeks before the actual Black Friday, and because retailers are known to launch wild sales out of the blue to stir up business before, during, and after Black Friday week, it’s foolish to assume that all of the prices shoppers encounter on the day after Thanksgiving are the lowest of the season. For some merchandise, including toys, name-brand TVs, and jewelry, shoppers can expect prices to drop after Thanksgiving weekend is over. Meanwhile, the discount-shopping site Ben’s Bargains anticipates that tablet prices will hit rock bottom in early November, and that prices for sports apparel and winter clothing will be cheaper in mid-November than they will be around Black Friday.

It’s a great year to snag a seasonal job. In 2008, retailers hired about 325,000 workers for the holiday period. The figure’s been on the rise ever since, hitting 786,000 a year ago. In a new report, researchers at Challenger, Gray & Christmas say they expect “seasonal employment gains in the retail sector to significantly outpace 2013.” Toys R Us, for instance, announced this week that it is hiring 45,000 seasonal employees, which more than doubles the company’s existing workforce, while UPS is planning on hiring 95,000 workers for the upcoming season. “We could see retailers add more than 800,000 seasonal workers for the first time since 1999,” said Challenger CEO John A. Challenger.

People will shop online earlier to avoid last year’s shipping nightmare. According to a new survey from Pitney Bowes, an e-commerce and shipping consulting firm, half of the consumers polled (49%) said that for the upcoming holiday season they will shop online earlier than they did last year. The most popular reason for doing so is to ensure that gifts and other packages arrive in plenty of time for the holidays. A year ago, many families were disappointed on Christmas morning because shipping delays caused orders from Amazon, Kohl’s, and other retailers to arrive after December 25. (Hopefully, the additional hires made by UPS will help ease the shipping problems of a year ago, but it’s smart for shoppers to play it safe by ordering well in advance.)

Apple loyalists will outspend Android users. Last November, the average order placed on a mobile Apple iOS device was $121.48, compared to just $89 for Android devices, according to a new IBM report. The data also shows that while we do more web-surfing with smartphones (accounting for 24% of all website traffic, compared to 14% via tablets), consumers are more inclined to make purchases on tablets (11.5% of website sales) than smartphones (5%). Again, Apple mobile device users outspend the rest of the field, representing 13.6% of web sales in March 2014, compared with 2% of site sales made via Samsung, LG, HTC, Motorola, and Nokia devices combined.

We’ll be heavily influenced by digital, but make most purchases in person. The forecast from Deloitte calls for a 4% to 4.5% overall increase in consumer holiday season spending. While researchers point out that 50% of sales will somehow be influenced by digital interactions (browsing online, for instance), only 14% of purchases will come in the form of non-store sales (primarily, e-commerce sales).

MONEY The Economy

8 Ways the American Consumer May Have Already Peaked

disposable diapers
Statistics suggest that American consumers may have hit "peak diaper"—for babies anyway. Joseph Pollard—Getty Images

The U.S. economy relies on robust consumer spending. But it's starting to look like Americans have had enough of some products.

Have you heard of “Peak Car”? That’s the idea that there’s a point at which total car ownership and miles driven will start declining. Given the questions about whether or not millennials want cars, as well as data showing that Americans have been driving less for a wide variety of reasons, some analysts believe that we’ve already hit Peak Car in the U.S.

And cars may not be the only thing that’s peaked. Here’s a look at a several seemingly disparate areas where U.S. consumers may be topping out.

Peak Car
The case for this one is controversial. Auto sales have been on the rebound since the Great Recession, sometimes growing by more than one million sales from year to year. After a hot summer for sales, 2014 is on pace for perhaps 16.5 to 17 million new vehicle purchases in the U.S. Then again, after months of heavy promotions and discounting, some experts believe the market is bound to slump toward the end of 2014, and few think that the tally will match the all-time high of 17.4 million sales in 2000.

Globally, some analysts predict that car ownership and usage will peak sometime in the next decade, while the Economist has theorized that Peak Car “still seems quite a long way off” because demand for cars in developing countries is expected to be strong for decades, and also because self-driving features will become mainstream. That means driving will be safer and insurance will cost less, drawing more people onto the roads.

Peak Casino
For years, there’s been talk about reaching a saturation point for casinos, in which gambling expands so widely that too many casinos are chasing the business of the same pool of customers willing to roll the dice and pull the arms of slot machines. The effects of such a situation are on display in Atlantic City, N.J., where one-quarter of the casinos opened at the beginning of 2014 are now closed. Two more casinos in Mississippi closed this year, and analysts are questioning whether markets such as the Baltimore area—which now hosts two casinos, and which has been blamed as a contributor to the falloff in gambling in Atlantic City—are big enough to keep local gaming interests afloat.

New casinos are still planned for Massachusetts and Pennsylvania, yet based on the number of casino closings and data indicating that overall slot revenues in North America are on pace to be down nearly 30% this year, it looks like there are already too many casinos in the marketplace battling to survive. “In many jurisdictions, gaming supply has increased while demand for the product has not, resulting in a state of market disequilibrium,” a post at the asset-based lending site ABL Advisor explained. “There is no simpler way for me to make this point.”

Peak Golf
Between 1986 and 2005, more than 4,500 new golf courses were opened in the U.S., including as many as 400 in a single year. Over the next six years, however, there was a net reduction of 500 courses, with 155 courses closing in 2012. Golf participation and golf sales are likewise plummeting for a variety of reasons: Ppeople are too busy, the sport just might be too hard, too expensive, or too uncool. And projections call for roughly 150 course closings and no more than 20 course openings in the years ahead. In other words, golf most likely peaked in the U.S. in 2005.

Peak Fast Food
The American appetite for pizza appears to have reached an all-time high around 2012, when one survey found that 40% of consumers noshed on pizza at least once a week. The food and beverage consultant firm Technomic noted in early 2014 that pizza consumption has “decreased just slightly over the past two years, likely peaking post-recession due to pizza’s ability to satisfy cravings and meet needs for value.” Foot traffic at Pizza Hut and other quick-serve pizza chains has been on the decline. For that matter, Businessweek recently made the case that the U.S. may also be reaching “Peak Burger.” The growth of franchises for fast food giants such as Burger King and McDonald’s has slowed significantly in recent years, with net openings close to zero.

Data from a new report from the NPD Group indicates that visits to low-cost quick-service restaurants, where the average customer bill is about $5, has been flat over the past year, and for the most part, income inequality and stagnant wages among the middle classes are to blame. “Low-income consumers, who are heavier users of quick service restaurants, were most adversely affected by the Great Recession and have less discretionary income to spend on dining out,” the study explains.

Peak Soda
Coca-Cola, PepsiCo, and the Dr. Pepper Snapple Group may have together just pledged to reduce calories by 20% in sugary beverages, but the effort appears unlikely to bring American soda consumption back to the heights of a decade or so ago. Per-capita consumption of soda fell 16% between 1998 and 2011, and in 2013, total volume sales of soda was measured at 8.9 billion cases, the lowest total since 1995. Part of the long-term decline has been attributed to Americans wanting to cut calories and have more nutritious diets, but diet soda sales have been tanking lately too.

Peak Fashion
In 1991, the average American purchased 40 garments of clothing annually, according to data cited by the Wall Street Journal. Clothing consumption took off from there, reaching an average of 69 articles bought in 2005, which appears to have been the peak. In 2013, American consumers had gotten their clothing purchases down to an average of 63.7 garments per year.

Peak Diapers (for Babies)
The U.S. birth rate declined 8% during the recession-era years 2007 to 2010, and just kept on falling thereafter, reaching a record low (thus far) in 2013. Considering that U.S. births peaked in 2007, it shouldn’t be a surprise that diaper sales in the U.S. have retreated since then as well.

What’s especially interesting is that as baby diaper sales have declined, industry giants like Procter & Gamble have stepped up efforts to sell adult diapers and other incontinence products to make up for the decline at the other end of the market.

Peak Median Income
Lots of these peaks are just challenges for specific industries. But here’s one that might worry any consumer-based business: People can’t spend more if they aren’t earning more.

In 1999, median household income in the U.S. was $56,895 in today’s dollars (after adjusting for inflation), according to census data cited by New York magazine. That was the highest it’s ever been. Lately, the middle-of-the-road household income in America has been $51,939. Given increased automation of the workforce and the rise of income inequality across the board, it may very well be that the median household will never be able to party like it’s 1999.

MONEY Shopping

You’ll Never Guess What Store Sells the Most Vinyl Records

Urban Outfitters Store in Herald Square, NYC, 2014.
Urban Outfitters Store in Herald Square, NYC, 2014. Patti McConville—Alamy

It's the same store known for selling supposedly hip, intentionally offensive clothing—and then apologizing in mock surprise when people are offended.

It’s Urban Outfitters, the clothing chain that recently received grief and load of media attention by marketing a seemingly blood-stained—or was it just vintage and discolored?—Kent State sweatshirt, (The store has also in the past has sold controversial, ill-conceived designs such as a T-shirts with slogans like “Depression” and “Eat Less” and bottles that look like they hold prescription drugs.) Urban Outfitter stores have been selling vinyl records for years, in a campaign that’s been so successful it’s drawn imitators trying to attract hipster music lover customers. You can get vinyl with your kale at some Whole Foods stores.

Now Urban Outfitters is claiming to be the biggest seller of vinyl records in the world. “Music is very, very important to the Urban customer,” CEO Calvin Hollinger said in a meeting with analysts this week (HT: Buzzfeed). “In fact, we are the world’s number one vinyl seller.”

At first glance, it might seem odd for a youth-focused apparel retailer to be in the business of selling music—especially one using technology that was considered old-fashioned and dying in the 1980s. But when you think a little deeper about vinyl records, and who’s interested in them, the sales category makes more sense. For one thing, records tend to have a longer shelf life than fast fashion. No matter how many fashion cycles pass, people will still want to listen to (and buy) the music of the Sex Pistols and Bob Marley and the Ramones. It doesn’t take up a whole lot of space in a store to hold a few hundred records, and the same customers who enjoy flipping through the albums are likely to be put in the mood for browsing other merchandise.

What’s more, in many parts of the country, there are no record stores left, so Urban Outfitters is the only option left—a surprisingly good option, as many skeptics have found. “I kept finding more and more crates full of more and more records,” one Village Voice writer stated regarding a shopping venture to Urban Outfitters last summer. “And pretty decent ones! And not super expensive (generally between $10 and $20).”

Perhaps most importantly, even as streaming has crippled sales of CDs and digital downloads, vinyl record sales are on the upswing. Nielsen data shows that for the first six months of 2014, vinyl LP sales were up 40% compared to the same period of a year prior. What’s behind the surge in vinyl?

“Ask any number of your friends who collect and listen to vinyl records, and there’s a good chance they’ll tell you vinyl just sounds better than anything else,” a recent Motley Fool post summed up. There’s also the hipster factor, combined with nostalgia and the collectability of classic and obscure record album covers. “In short, vinyl is cool.”

Also interesting: Starting in 2008, an event dubbed Record Store Day has been celebrated every April, in which more than 1,000 independent stores in the U.S. have special promotions and roll out new albums on vinyl for sale. The 2014 edition of Record Store Day was the most successful ever, with sales up 58% over the previous year’s event, and up 91% compared to the previous week, according to Rolling Stone.

Last year, a Record Store Day imitation event was added to the mix, and its second incarnation actually takes place this Saturday in select stores. Something tells us it won’t be quite as successful as Record Store Day, however. It’s called Cassette Store Day.

TIME China

Meet Alibaba’s Jack Ma

The man leading China’s online shopping giant to America

Ma’s Alibaba, China’s online-shopping giant, completed the largest initial public offering in history–$25 billion–on the New York Stock Exchange. The shares started trading on Sept. 19, and the value of the company exceeded that of Facebook, Coca-Cola or IBM.

• CLAIMS TO FAME

Fifteen years ago, Ma, a former English teacher, started Alibaba in an apartment in the Chinese city of Hangzhou. Today Alibaba is the undisputed champion of online retailing, handling twice as much merchandise as Amazon. An indifferent student, Ma built his empire without the top diploma or political connections usually needed to succeed in China.

• BIGGEST CHALLENGES

Ma will be under pressure from his new investors to deliver ever larger profits. He must expand outside his home market while also fighting off opponents at home. Chinese Internet giants Baidu and Tencent and property group Wanda recently joined forces to start a rival e-commerce firm.

• BIGGEST THREAT

China’s authoritarian rulers still wield tremendous control over business. A big wild card in Alibaba’s future will be Ma’s ability to stay in the good graces of the Communist Party while building trust with consumers in the West.

• BIGGEST CRITIC

The investor Peter Thiel passed on Alibaba’s IPO, arguing that a bet on the company was ultimately a bet on Beijing–with the political uncertainty that implied.

• CAN HE DO IT?

Ma has a proven track record of competing with global e-commerce titans–and winning. He’s shoved aside eBay and Amazon in China. And with his post-IPO war chest, Ma has the financial muscle to invest heavily and acquire other firms. The question is, Will he shop wisely?

–MICHAEL SCHUMAN

MONEY online shopping

Amazon Wants to Invade Your Home With Its One-Click Buying Button

Amazon boxes in front of door
Goss Images—Alamy

If Amazon has its way, one day our homes will be equipped with devices that detect when we're running low on household supplies and let us order more—from Amazon, of course—with one touch of a button.

According to Reuters, Amazon is developing a device that would be installed in a house—perhaps tucked away on a kitchen counter, or inside a closet or pantry—and enable customers to order detergent, toothpaste, paper towels, and other home supplies by simply pressing a button.

Amazon, which tends to be notoriously tight-lipped about its innovations and experiments until Jeff Bezos feels like blowing everyone’s minds (see the “60 Minutes” story on drone deliveries last year), isn’t talking publicly about the one-button device it reportedly has in the works. It’s also unclear if and when such a device would be ready to be tested in actual homes. Anonymous sources cited by Reuters say that the device is being developed by Lab 126, the secretive outfit owned by Amazon that has helped design and engineer gadgets such as the Kindle and Amazon Fire Phone.

In theory, the device would be installed in an Internet-connected home, in which various appliances would “talk” to each other via wi-fi. Sensors would be able to detect when the home is, say, in need of a new air-conditioning filter, or when you’re due to buy more laundry detergent, and it would prompt the customer to order new supplies with one press of a button.

In addition to the one-button device, Amazon is also looking into developing wearable gadgets that might allow customers to place orders for home supplies and other items with a single touch. The potential of such innovations follows right in line with Amazon’s ongoing efforts to be the destination of consumers seeking to purchase, well, pretty much anything and everything you can imagine.

Amazon Prime is brilliant not only because it gets customers to fork over $99 upfront annually in exchange for two-day shipping, but more importantly because it results in members making far more of their everyday purchases at Amazon. The online shopping giant’s forays into same-day delivery, groceries, and a household supply service called Prime Pantry are all part of its mission to eliminate tedious shopping errands by allowing customers to handle them via Amazon and one-click buying. Amazon thereby has been systematically horning in on the everyday sales of its competitors, which include players ranging from Best Buy to Costco, and CVS pharmacies to Kroger supermarkets.

Then there’s the Fire Phone, which hit the market this past summer and stood out from the pack most significantly thanks to Firefly—a feature that scans the barcodes of items and lets you purchase them instantly, via Amazon of course. Anyone buying the phone also got a free year of Amazon Prime, which brings customers further into the Amazon purchase-sphere. Less than two months after the Fire Phone entered the market at a minimum price of $199 (with a two-year contract), it was discounted to 99¢ (a price drop that some had predicted the moment the device was introduced).

Nonetheless, the Fire Phone flop isn’t going to slow Amazon’s pursuit of innovations—and a larger and larger portion of our purchases. Earlier this year, the Wall Street Journal spread the word that Amazon was a developing a service dubbed “anticipatory shipping,” in which the company would anticipate customer needs before any order had been placed, and it would ship what it felt you needed before anyone ever clicked “buy.” Now it looks like Amazon wants to have devices installed in customer homes, so that it can anticipate our shopping needs at a deeper, more invasive level and sell us stuff before anyone even considers other shopping possibilities, let alone actually leaving the home to make a run to a store.

The goals for Amazon in such developments is to ease any friction and slowdown in the purchase transaction, to eliminate hassles and save time for customers—and to sell us more and more stuff.

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