Corporate travel and entertainment (T&E) expense accounts are a sizeable chunk of a company’s outgoings. Most people probably don’t realize how significant it actually is, and with travel budgets being carefully scrutinised in these tough economic times, travel managers are finding it extremely difficult to forecast next year’s budgets.

The research we’ve conducted around this—which can be seen in this White Paper —makes the case abundantly clear.

According to the JP Morgan 2011 Corporate Travel Card Benchmark Survey, detailed card management information gives travel managers accurate data about how much they spend with each T&E supplier, allowing them to negotiate better discounts for:

• frequent air fares (9.1% versus 5.9% without using the corporate card data),
• hotels (12.3% versus 9.5%) and
• car rental (14.5% versus 12.4%).

Payment card data can help forecast and accrue T&E budgets so that companies have a clear picture of their employee’s spend and can allocate resources accordingly.

We are living in data rich times, and the valuable role that information can play in managing budgets and improving the operations of business and government is hugely significant.

I’d encourage anyone who manages travel expense programs to share their thoughts and ideas on the best ways to improve efficiency. I look forward to hearing your insights.

“Privacy” and “security” are often used together but don’t mean exactly the same thing. Privacy means the right to determine how your information is going to be used. Security means that the information will not be used for harm. The sharing of passwords between girlfriends and boyfriends demonstrates that teenagers do not perceive a risk of either having their privacy or their security compromised.  They are fine with the sharing of information—as long those they share their information with are individuals or companies that can be trusted and/or that they receive a benefit in return.  In the case of romantic relationships, it is greater intimacy and a deeper bond. For others they share with online, it could be something else entirely.

The article in The New York Times talks about teenagers across America displaying their affection for their partners by choosing to share e-mail, Facebook, and other passwords. These teens are not oblivious to the risks of such sharing, but rather are doing it because it is risky, and therefore do it as a sign of trust. Tiffany Caradang, a high school student from San Francisco quoted in the article, notes “I have nothing to hide from him, and he has nothing to hide from me.”

Companies who use the web as a sales channel, a marketing channel, or a product itself must understand the issues and societal perception of privacy and security. By proving that they can be trusted and are not going to harm their users, companies can solidify relationships with consumers and position themselves to provide these consumers with the right services at the right time. In return, they will gain customers who will tell their friends “It’s all right, I trust them.”

Tablets will reach one-third of U.S. adults by 2015 via a 51 percent CAGR from 2010 to 2015, according to a report recently published by Forrester Research (“Why Tablet Commerce May Soon Trump Mobile Commerce” July 2011). Currently, Forrester says, one-half of tablet owners report purchasing products online and another 13 percent have shopped on their tablet but have not purchased. These are not trivial numbers and spark interesting questions about consumer shopping behavior with these new devices and their preferences among form factors.

When it comes to shopping, tablets, while not quite PCs, provide more than smartphones. Tablets will not outnumber PCs in the home anytime soon. However, many see their tablet as a replacement for their secondary PC or a complement to their primary one. Regardless of how they view their tablet, 40 percent of respondents to the Forrester survey report they use their tablet more when both their tablets and their PCs are available. It’s easy to see why. Consumers generally feel that tablets provide greater convenience than PCs because of their size and ease of use.

Tablets also overcome the main problem with smartphones: small screens. The same Forrester report indicates that more than half of owners of both tablets and smartphones prefer using tablets over smartphones for shopping.

Retailers cannot afford to neglect this new device. Traditional websites are optimized for PCs—not smaller screens—while mobile websites are designed for the much smaller screen. Some retailers have been successful developing shopping apps rather than changing their sites, but this is more expensive than optimizing their sites for different browsers. Whichever path retailers take, they need to optimize their content delivery in order to maximize t-commerce.

The only example that we have in the last 200 years of a continent-sized economy rapidly industrializing is the United States between the end of the Civil War (1865) and the outbreak of the First World War.  Over a half century, the United States changed from a largely agrarian economy to a highly urban and industrialized one—becoming one of the wealthiest and most dynamic economies in the world by 1914.

In this half century of breathtaking economic growth, however, the U.S. economy suffered 13 recessions, seven of them accompanied by financial panic and massive bank failures. Indeed, the U.S. economy was in recession an astonishing 54 percent of this 49-year period.  In four out of the 13 recessions, business and industrial activities contracted by over 30 percent.  In 1890, 2 percent of households earned more than 50 percent of total household income.

In other words, during a period of rapid industrialization and growth, the United States suffered violent market swings characterized by boom-bust cycles, with serious social and economic dislocation inflicted upon the vast majority of Americans. These boom-bust cycles were confined to the American economy in most of the 19^th century. But as soon as the United States started to become more integrated with the global markets in the early 20^thcentury, its boom-bust cycles began to affect the rest of the world.

Essentially the same is happening today, with one notable difference:  The Chinese, Indian, and Brazilian economies are much more integrated with the global economy than the U.S. economy was in the 19^th century.  Thus, their boom-bust cycles reverberate instantly across the world.  Yes, the global economy is undoubtedly better off with the emerging markets, but paradoxically, it is also more volatile as a result.

To learn more about the latest report, watch this video:

For more information, please check out:

• MasterCard Consumer Spending Infographic
• “Consumer Spending Outlook and Value Creation in the New Global Economy” report

Yuwa Hedrick-Wong is a guest blogger and Adjunct Professor at the Sauder School of Business, University of British Columbia, Vancouver, B.C. Canada.

I was surprised by how young they were to own mobile phones, much less iPhones.  I thought to myself how nice to be “city kids.” Kids who grow up in the City, well at least those on the Upper West Side, tend to grow up a little faster—perhaps because they have affluent parents who can afford to buy more expensive things than the average.  So I dismissed the scene as an anomaly.

That evening, curiosity got the best of me and I started to research the average age when people acquire their first mobile phones.  The results?  According to a recent survey by Verizon Wireless and Parenting.com, the average age at which Americans get their first cell phones is 11.6.  According to the Personal Finance Education Group, the average age in the United Kingdom is 8.  And it continues to drop every year.  Wow!  I didn’t get my first mobile phone until well after college.

I started thinking that perhaps banks and payment companies are not engaging young people early enough.  We tend to wait until consumers own a credit card or have a job before thinking of them as serious contenders for financial services.  But while teens might not produce their own sources of income, they do wield a lot of power over household purchase decisions—especially those they care about:  clothes, videogames, food, and even smart phones.

Mobile commerce is becoming a reality right before our eyes.  I think the payments industry needs to get in on the action and service this group of consumers—or shall I say influencers?  While I don’t have the answer quite yet, I’m willing to bet mobile phones will be part of the equation.

What’s behind this?  A number of factors.  In brick and mortar stores, we’ve been seeing a steady increase in the number of promotions being offered by merchants across the spectrum.  On top of that, stores are opening earlier and earlier on Black Friday – some as early as midnight – and in the past, we’ve usually seen that the increase in hours leads to an increase in overall sales.  Internet sales, too, have been on the rise, and not just at the expense of traditional stores.  Finally, a rise in prices of oil, cotton, and other commodities has pushed prices up this year, and so that, too, gets added to the mix.

If the past is any guide, we should be seeing particularly strong results in luxury.  Black Friday is traditionally the second biggest day for luxury, and considering how well luxury has been doing all year, this Black Friday could be a good one.  Black Friday tends to be even more important for electronics.  Traditionally, it has been the single most important day for that sector, showing twice the volume of the next largest day.

While most sectors have been strong recently, those related to the housing market are still struggling.  Looking at some our latest SpendingPulse information, furniture and furnishings are substantially below their pre-recession levels, while sales for other retail sectors are anywhere from 5%-15% above where they were in 2006.

You can see the full interview below:

http://www.bloomberg.com/video/81471492/

“Finances @ the Foundation” is the number one trend affecting consumers in the United States today. This trend, identified with the help of the GfK Roper Consulting, highlights consumers’ genuine recognition that a healthy financial underpinning is necessary to “live the dream.”  This understanding has been shaped and reinforced by the current economic situation in the United States.  Consumers have become more risk averse; “living within your means” is moreen vogue today than at any time in recent memory.

Companies need to be aware that financial health is what matters most to the majority of consumers and is the lens through which they view almost everything else.  This reality shapes many of the other consumer trends that I discuss in Remaining Relevant:  Seven Consumer Trends to Watch—and Act On and is important for banks, credit unions, and even merchants to keep in mind as they plan for 2012.

Paying close attention to emerging consumer trends is no longer optional.  Companies have a choice:  Either meet changing consumer needs or face the prospect of extinction.  Technology, which is changing the way we live, can also play a role in spurring the innovations that will help organizations adapt and thrive.

Research firm Aite estimates U.S. prepaid will grow to US$104 billion (US$164 billion including payroll cards) in volume loaded by 2014; a positive opportunity showing some financial vehicles are still growing in light of the economic downturn. Mobile is another such example. Coupling mobile and prepaid looks to be a promising effort to further innovations in payments.

The uptake in developing countries around mobile has shown signs of success.  There are parallels in how prepaid has met a need in developed countries and how mobile has met that need in the developing world. Indeed, in countries like Kenya the prepaid and mobile models have been combined in a powerful way enabling players in the market to make significant progress on the mobile front far ahead of most developed countries.

While the U.S. is by most measures a mature payments business, it is still in the nascent stages of mobile payments adoption; similarly with prepaid. A country like Italy however, also in the early stages of mobile payments adoption, have modeled what seems to be a promising rollout paradigm similar to that of developing countries like Kenya.  Poste Italiane, Italy’s postal service provider and owners of Italys largest bank, BancoPosta, has become a major player in Italy’s mobile market.

Italy is not looking at each of these products in isolation.  The Poste Mobile brand was created back in 2007 and Poste Italiane has found synergies between the mobile and prepaid space through the Postepay prepaid cards. Customers can send mail, transfer money, pay bills, pay for transportation services, from and to their Postepay prepaid cards through top-up mobile phones. Poste Italiane, with 50 percent of Italy’s mobile share, is finding ways to integrate their customers to a greater familiarity and usage of mobile through the prepaid model.

Could prepaid be the precursor to mobile bringing consumers to a greater handling of mobile payments?

In partnership with eXelate, we described an exciting way to overlay segments based on anonymized MasterCard transaction data.  The focus is on helping advertisers to deliver more valuable offers – and reducing the clutter that many consumers experience today.

It begins with our anonymous data, which is pooled together, analyzed and averaged to develop buying trends and to help predict future purchase potential.  Advertisers can use this insight into purchase desire to overlay on their current methodology as another filter to determine what offers go to which audiences.  For example, businesses can get a better handle on when, where and how often segments of consumers purchase, and even gain aggregated insights into propensities for future purchases.

Ultimately, with additional insights available to advertisers, the world’s inboxes will be less cluttered and consumers can receive the value they deem relevant and important to their quality of life. Our new approach and willingness to forge new partnerships seemed to resonate at this gathering. We’d certainly like to hear your views as well

Please view our presentation below:

So here’s a third metaphor to throw into the cocktail: When in Rome…

One of the reasons that MasterCard has been so successful with its new prepaid debit program in Italy is the very high relative cost of maintaining an actual full-blown current account there.  It can cost consumers as much as €75, but averages out at about €45. So, naturally, a prepaid card is a great alternative.

Now some U.S. banks are, thanks to “Durbin,” forced to charge cumulatively as much as $17 or $20 monthly to run a DDA account. It’s not €45, but it’s not free, either.

There’s more going on here than backfilling a revenue shortfall. It’s about whole swathes of the DDA portfolio rendered unprofitable by a stroke of the legislative pen. If the goal is financial inclusion, then the Italian model, migrating to prepaid consumers unwilling to pay those fees, makes a lot of sense, doesn’t it?

Mario spoke about the increased role mobile devices continue to play in our lives and how technologies, like PayPass, are revolutionizing the shopping experience to offer consumers simple, easy and convenient ways to pay for goods and services. Check out a clip here and be sure to check your local listings to hear more!

What are your biggest concerns about mobile payment? Please share in the comments below and we will try and answer your questions to the best of our ability.

The research we conducted with Joeri and his team aimed to find out was how young people use technology and social media when shopping in grocery and fashion. What it underlined is that this is a demographic group that has grown up with mobile phones and is inseparable from their devices – the mobile phone is their key tool to interact with the world. So retailers who want to stay ahead of the curve need to keep up and provide the mobile services young people are looking for. Joeri presented some great examples of what retailers are already doing in this sphere and how we at MasterCard are leveraging our partnerships and insights to help retailers maximise the opportunity ahead.

The research got us many key findings:

• Young people don’t only use their phones to shop. More and more, young people use their phones to build relationships with the brands they like
• It’s more common in the UK than in Germany to buy items over the internet, particularly in terms of grocery shopping
• Confidence levels in buying online are almost twice as high in the UK

Above all, what is clear is that today the mobile device is no longer just the phone for the Y generation – it is an enabler, helping youngsters to connect to their social world in a multitude of ways. Now they expect retailers to engage with them through this device (be it smart phone or tablet) as they shop, create their wish-lists and compare today’s hottest products with their friends.

What would you like your shopping buddy to be able to do for you?

The security can be thought of as layers that protect the integrity of the transaction, and by extension protect the consumer.

(i) We chose NFC technology as the basis for secure mobile contactless payments because of its very short range (less than 4cm). We wanted to make sure that consumers still made conscious decisions to pay — we don’t want payment happening accidentally.

(ii) We require that the PayPass application on the phone be housed within a tamper-resistant chip known as a Secure Element. The Secure Element has various physical and logical security components that controls access to sensitive data regardless of the phone’s own operating environment.

(iii) We built into the PayPass protocol, technology that generates dynamic data every time a transaction is made. This dynamic data means that in the event transaction data is captured by a bad actor, the data has no value and cannot be used in replay attacks.

(iv) Developers of wallet software on the phones often provide an option for consumers to enter a code prior to accessing the wallet. Therefore, the wallet itself could be locked preventing any payments.

(v) Once a transaction is made it traverses the MasterCard Worlwide Network, the same network that supports billions of card transactions today, and the consumer is afforded the same protections (e.g., zero liability guarantee) as card-based transactions.

Bottom line: we’re glad when people want to talk about security because MasterCard has been working on making mobile payments secure for more than 10 years. That said, are you ready for the mobile revolution when it comes to payments? Let us know in the comments!

Yes, NFC is a hot topic – especially in the developed world. But mobile plays a larger role than that. In my latest paper, Will the Mobile Device Revolution Drive the Globalization of Payments? I describe how mobile provides huge benefits to consumers in the developing world based on its ability to provide financial services to unbanked populations. Hear what I have to say about mobile payments.

Mobile is just one area that we are discussing on Thursday, September 15 at our Media Day in New York. NFC. Mobile money. QR codes. All will be discussed. But I’d like to hear what you think about mobile payments, its potential, and what it could do for the global population. Let me know your thoughts by providing a comment and let’s have a dialogue.

The most interesting paragraph in these posts is one from Tim Chen, in which he says, in part, “if we could see our bank accounts diminish as we make a purchase, or watch our debt grow, we might regain the visceral feeling of spending what we earn.”

With respect, U.S. consumers are way ahead of the NerdWallet CEO. It’s not so much the coolness of mobile payments that’s going to convince U.S. cardholders to move to the new form factor; it’s how smart phones satisfy the desire to better control finances, partly by more closely managing purchases and payments.

The same week Chen posted on Huffington, Santander relaunched its website globally, giving enhanced access to its customers. “Consumers can see their total financial picture, including mortgage, credit cards, and accounts,” Matthew Timms, Santander’s electronic commerce director told Bank Technology News.

While Santander is one of a very select group of institutions that can initiate such changes globally, U.S. banks of every size should sit up and take notice. These advances in technology are not about gee-whiz; they’re about banks’ prospering in an environment that has changed substantially and irrevocably.

It bears repeating. The U.S. consumer had the living daylights scared out of him three years ago next September 15, and continues to modify spending and saving behavior based on that experience.

More and more U.S. cardholders are regarding their payment card relationships as part of a larger banking picture that keeps them apprised—at the end of the day, the end of the month, the end of the pay period—of what, in business parlance, their position is. Enhanced web functionality and a form factor that delivers information to the cardholder as well as to the merchant—mobile payments—is the way forward for U.S. issuers.

Mobile could also encourage multiple relationships with the same institution plays into the profitability model that regards levels of deposit as the key revenue driver; this can only be an added benefit—for both issuers and consumers.

There’s no need to wait for George Jetson and the future because mass transit agencies are exploring new methods of payment TODAY, providing commuters more convenient, reliable and fast options. These include methods as simple as more automated kiosks to new ‘tap-to-pay’ tools for on-board payments and more.  One agency that is taking steps toward this is the Metropolitan Transportation Authority (MTA) in New York.

Last week, the MTA announced it is testing a program on select Long Island Rail Road lines that allows passengers more payment options when buying a ticket after boarding the train. The LIRR will begin a pilot that will allow passengers to purchase tickets with their credit cards on the train by equipping their conductors with Ticket Issuance Machines (TIMs). More than one million tickets were purchased using cash on board the LIRR in 2010.  With this program, neither conductors nor passengers need to worry about the inconvenience, hassle or security concerns tied to carrying a certain amount of cash or receiving large amounts of change due to the increased convenience of electronic payments.

Last year, MasterCard conducted a six-month technology trial with the MTA where passengers could pay their fare by tapping a contactless PayPass card or device on specially marked readers at select stations on the New York City subway system, as well as on designated bus routes.  The speed and convenience of PayPass was hailed by passengers and the MTA is planning to open up their system to card payments permanently.

But, this isn’t just an opportunity for New Yorkers.  MasterCard is making the future of payments a reality across the globe. In London, we are working with Transit for London on their Oyster Card system that promises to offer card access to the Underground, as well as buses and regional trains.  MasterCard is also providing PayPass contactless payment solutions for urban transportation centers around the world, across the US, Asia (including Singapore, Taiwan, Korea) and Europe (including the UK, Italy, France, Turkey, Poland, and Russia).

Where would a faster transaction through technology like PayPass create more convenience in your day?

According to a national online survey conducted for MasterCard by Harris Interactive, concerns about the economy are impacting the purchasing decisions of a majority (75%) of Americans with household members attending school this fall.  Nearly 70% say they will spend the same or less on back-to-school purchases compared to last year.

Economic concerns are driving nearly 58% of Americans to value a good deal on supplies for fall.  With saving on their minds, parents will look to get an “A” in smart spending by:

• Looking for more discounts, coupons and deals (69%)
• Buying only absolute necessities (50%)
• Doing more comparison shopping (46%)
• Shopping only in stores that offer sales (44%)
MasterCard: Back-to-School Spending Survey
View more presentations from MasterCard Worldwide.

Instead of hitting the streets and battling crowds in search of deals, why not stock up on bargains from the comfort of home?  Starting this week, MasterCard MarketPlace™ is offering back-to-school offers through the end of September on the items students need to make the grade.

• Stock up on essentials:  Search on “Back To School” on MasterCard MarketPlace, and you’ll find great deals on everything you need for the school year ahead – from tablets to books and other class and dorm room essentials.
• Hook up your laptop: Deep discounts offered on computers.  Right now save up to 47% on Essential Student Packs from Hewlett-Packard, including HP Photosmart e-All-in-One printers, flash drives and call services for Pavilion laptops.
• Kick fall into gear in style: Get great offers on cool items that kids want without breaking the bank like athletic shoes from New Balance.

Our study shows that 27% of Americans perform shopping activities with their phone and we help them stay in-the-know on Overwhelming Offers, an iPhone application that keeps you updated on all the daily deals we have to offer. MC OO provides deep discounts of 50% off (limited quantities) on merchandise to help ease those back-to-school blues.

Now that making the grade through our back-to-school savvy-saving offers is easier than ever, cheer up and enjoy rest of summer!

The market for cross border e-commerce shopping is significant: According to comScore and Euromonitor, cross-border e-commerce represents 14% of e-commerce volume, approximately $44 billion. By offering their products to consumers around the world, retailers can hedge against economic conditions in their home markets by capturing foreign consumers who are financially healthier. By decreasing their reliance on domestic consumers, merchants can smooth out the peaks and valleys in their own country’s economic cycles.

Merchants in the United States and the United Kingdom are well positioned for international expansion via the web due to their success with domestic e-commerce. The United Kingdom has geographical advantages by being located near continental Europe, while the United States is attractive to the growing economies of Latin America. When asked by GfK Roper for their primary motive for international e-commerce, 41% of cross border shoppers said it was to purchase products not available domestically, while 40% cited lower prices.

By focusing on the growing demand beyond their own borders, U.S. and U.K. merchants can augment their existing e-commerce customer base with an international one. Retailers can reach the most attractive consumers around the globe while shoppers can access the best products at the best prices. International e-commerce has the potential to revolutionize retailing around the world, and those who harness it early will have a clear advantage.

Also appears on MasterCard’s Payments Perspectives Blog.

This year, London took top honors in terms of the total number of visitors and the amount of money people spent. Read the full study here.

As a follow up to this study, today we launched MasterCardCities.com, an interactive map that offers a new, visual way to digest the economic data.

The interactive graphic lets you click on any city to see where tourists are coming from or where that city’s citizens are traveling. The map also shows:

• How much money travelers are spending in each city;
• The total number of inbound and outbound visitors per city; and
• The percentage of business travelers versus leisure travelers.

The map helps us visualize the global economy and how these cities have become hubs that are driving the global economy.

It may be clearer than it has been, however, because at the same MasterCard Academy of Risk Management (ARM) conference where McNelley made her alarming assessment, she conducted a survey of attendees, which indicates that in the U.S., the ice may be breaking on EMV as the solution to the card security conundrum.

Surveying 76 risk management professionals at the April event, McNelley discovered while malware is their number-one concern, most of them expect that EMV will be the preferred response—if over time. In the words of the Aite executive summary, “…card industry executives no longer believe that EMV in the United States is a matter of ‘if’, but a matter of ‘when’. Risk management executives are also bullish on the prospect of near-field-communications (NFC) making inroads within the next few years.”

The two matters are of course not unrelated. NFC, which requires a chip, accommodates EMV very neatly.

Your agent has a dog in this hunt. Beginning in 1998 and ending not until five years on I constructed and published a series of infrastructure cost analyses of the implementation of chip-based authentication (and hence EMV) in the U.S. It never happened, of course, because merchants didn’t want it, and issuers didn’t want it bad enough. But mobile, in this as in other areas, may change everything.

A new infrastructure cost analysis beckons. But whatever the big number turns out to be, the question remains, who’s going to pay for it? And with what money? Meanwhile, seven years sounds about right.

Rarely is a comment made on the global economy without referencing the global imbalance, in terms of trade and relative currency values, and China’s part in perpetuating it. And, indeed, China in the past decade has been reshaping the pattern of global trade, not just as an “export machine”, but as a trading partner in terms of import/export of goods and services, investment and capital flows. However, neither China’s success in imports, nor its rise as a trading partner can be explained in terms of its trade imbalance or undervalued currency.

I hold the view that China’s role in the global imbalance is due primarily to its internal economic imbalance, mostly as a result of a series of developments in the past decade. From this perspective, China’s under-valued currency has at best played a tangential role. Moreover, the media hype on China as an export machine has the unintended consequence of focusing attention on the export side of the current account. An economic structure that coupled monopoly profits with low labor costs, in addition to the One Child Policy, kept household savings high and consumption relatively low.

But China is now at the cusp of a profound structural shift in its economy, and in the coming years, coinciding with the 12^th Five Year Plan, due to take effect later this year, domestic private consumption will likely rise much faster than before.

Since domestic private consumption is, I believe, the only true measure of value in any economic system, this rise in consumer spending will go far in easing the domestic imbalance, which does much to cause the global imbalance, the latter such a popular topic of discussion among pundits, economists and the governing classes.

Also appears on MasterCard’s Payments Perspectives Blog.

Yuwa Hedrick-Wong is a guest blogger and Adjunct Professor at the Sauder School of Business, University of British Columbia, Vancouver, B.C. Canada.

According to MasterCard research conducted by GFK Roper,  the explosion of product choice has left many consumers feeling unsure of whom to trust when making purchasing decisions. To get honest feedback from other users, consumers are relying on social networking sites to learn about products and express their views on what works, what doesn’t, and how they feel about it.

Unsurprisingly, this trend is driven by Generation Y, consumers who are more likely to go out of their way to talk about products they like and to solicit other people’s opinions when making purchases. Affluent consumers are also turning to the web to assess purchase options and express their views; what’s more, affluent consumers tend to be continuously on the lookout for new products and services.

According to the research, 48% of users of social networking websites say they use the sites to “post comments or read what other users have said about a brand, product, or company.

Software developers are tapping into this growing trend by creating apps like Gripe—a mobile phone-based service that lets consumers air their grievances with merchants and enables merchants to learn about and resolve problems. Consumers’ desire to broadcast their opinion and user experience has shifted some of the power away from merchants, and represents the new reality of  brand communications.

The conversation around brands that takes place online is critical for all businesses to understand. Consumers are turning to each other in order to learn about what they’re buying, and are willing and able to speak out when they don’t get what they want. In order to succeed in this new environment,  merchants and brands must ensure they are driving the social media conversation with their customers, willing to hear about problems, and committed to solving them.

Also appears on MasterCard’s Payments Perspectives Blog.

So before the fireworks, BBQ’s and baseball games commence, I’m back again to talk about what’s happening with gas before the July 4^th weekend hits.

To get started, let’s provide some context on the figures.

July 4^th is different to Memorial Day which always falls on a Monday. July 4th is a fixed date, and the day of the week on which it falls changes from year to year. All this has an effect on gasoline.

For example, a Tuesday holiday might result in many taking a five-day weekend, while a Wednesday might be limited to a day at the beach. This year, Independence Day falls on a Monday, which means that most people will begin filling their cars on Friday.  The different set of days makes it tricky to make year-over-year comparisons, as much will depend on when and how much time all of you take off.

That said, last year, over the comparable 4-day period of July 2nd through 5th, a Friday through Monday, we saw about 35.5 million barrels pumped.  Prices in that weekend of 2010 were around 30% less than a year ago at $2.71 per gallon as a national average.

As we get to July 4th, 2011, we see that the national average price is around $3.62, as noted in our report. While this is over 30% above last year’s average price, it also follows six weeks of price declines, and is the lowest average price since the beginning of April. We’ll be looking to see if demand will continue to be down for this 4th of July holiday compared to the similar period last year. Alternatively the pattern of price declines could lead to optimism and increased pumping.

The 109-day summer driving season tells the same story.  A high in 2007, a steep fall in 2008, something of a recovery in 2009, only to fall back in 2011.  Time will tell how Independence Day 2011 and the 2011 summer season will fare, but historically, we have only seen declines in demand when prices reached all-time highs, and are over 30% higher than they were a year ago.

I’ll be back with more very soon, but for now, enjoy the holiday all!

The trend I am talking about is “Instant Everywhere”,  identified by GfK Roper as one of the key U.S. consumer trends in 2011.  Consumers want access to things around the clock—the instant they are ready to use them.  This is primarily driven by a need for convenience and the desire to use every minute of every day as efficiently as possible.

While this is not a new development, it is one that has significant applicability to banking and payments today and in the future.

Smart phones have become the dashboard of consumers’ lives by enabling them to access email, find the nearest gas station, and pay bills on the fly.  Smart phones have allowed consumers to multitask in a major way; more and more consumers rely on their phones to simplify their daily lives. A Prosper Mobile Insights survey completed in May 2011 reveals that half of Smartphone users say their phone is “their life”; a majority utilizes all functionality of their device.

I think the big mobile phone innovation of 2011 and 2012 will be the expansion of mobile payments—to our babysitters (P2P payments),  online retailers (remote payments), the grocery store (proximity payments), you name it.  Consumers are becoming more comfortable with using their phones to manage their daily lives and payments are no different.  Mobile purchases exploded this past holiday season.  According to ForeSee Results, 11% of web shoppers made a purchase from their phone in 2010 as compared to 2% in 2009.

Banks looking to remain competitive in the payments game need to embrace this trend and play a part in shaping the new dynamic—or risk being left out. So stay tuned.  Paying with your phone will be the wave of the not too distant future.

More humans of all kinds are living in cities. At some point in 2006-2007, for the first time in human history, the majority of the world’s population lived in urban areas, up from just 15% in 1900. That’s a historic milestone in a journey that started over 5,000 years ago. Today, cities continue to perform the same functions as their predecessors did in Mesopotamia and ancient China, except that they are much bigger, more complex, and increasingly diverse, with vastly expanding geographical reach. The urban economies are typically richer and more dynamic than the rural economies of the same country.

In the aftermath of the 2008-2009 global financial crisis, many of the world’s leading cities have demonstrated their resilience and ability to recover quickly. In the post-crisis global economy, cities and their urban economies will be will become even more important as engines of global economic growth.

International travel is an indicator of this growth, underpinning in turn the growth of key industries, such as transportation, retail and hospitality, as well as professional services like marketing and advertising. The economic and business impacts of international travel are especially pronounced in cities that are popular destinations of international travel, and in the destination cities, spending by international visitors contributes significantly to local commerce and business activities, amplifying the dynamism of these urban economies.

Most important, many emerging market destination cities are showing both high visitor arrival and expenditure growth. This kind of growth strongly suggests that destination cities in emerging markets worldwide will continue to grow in importance in the new global economy.

These insights are based on MasterCard Worldwide’s Global Destination Cities Index.  Watch the video below to see me explain the results.

Yuwa Hedrick-Wong is a guest blogger and Adjunct Professor at the Sauder School of Business, University of British Columbia, Vancouver, B.C. Canada.