TECHNOLOGY

Amazon in new rewards program for Prime

BY By Marianne Wilson

Amazon is giving shoppers another reason to sign up for Prime—and a reason not to use credit cards.

The online giant is launching a new program, called Amazon Prime Reload, that allows Prime members to earn 2% bonus every time they reload their Amazon gift card balance with cash from their checking account and debit card. The bonus is given in the form of rewards that can be used to make purchases on Amazon.

The new program lets Amazon avoid credit card fees. It also adds an additional incentive to sign up for Prime membership. In order to qualify for the new program, shoppers have to give Amazon their U.S. bank account and routing number, debit card number and driver's license number.

Amazon already has a branded credit card for Prime members that gives card holders 5% cash back on Amazon.com, and cash back when spending at restaurants, gas stations, and drugstores.

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TECHNOLOGY

The first back-to-school spending forecast is out

BY By Marianne Wilson

There is good news for retailers in a just-released 2017 back-to-school spending forecast.

Retail sales during the back-to-school shopping season of July and August 2017 will grow 4.0% over 2016, according to eMarketer’s forecast. Retail sales in the U.S. during those core months will reach an estimated $857.18 billion, accounting for 17.0% of total retail sales for the year.

E-commerce for the back-to-school season will grow 14.8% to $74.03 billion in 2017. That represents 8.6% of total back-to-school retail sales—online and offline—for the period, up from the 7.8% share last year.

“Ecommerce growth this year comes on top of a strong year in 2016, making it that much more impressive,” said eMarketer senior analyst Yory Wurmser. “Younger consumers that shop in preparation for going back to high school and college actually prefer shopping online, so ecommerce growth should continue for the foreseeable future.”

Five product areas play an outsized role during the back-to-school season:

Apparel and accessories

Books, music and video

Computers and consumer electronics

Office equipment and supplies

Toys and hobbies, including sporting goods

Back-to-school ecommerce sales in these core categories during July and August will exceed the quarterly growth rate for ecommerce overall at 15.8%, reaching $37.56 billion.

“Several core product areas are among the sectors with the highest ecommerce penetration,” Wurmser said. “Even apparel, which traditionally has been bought in stores, is increasingly moving online.”

eMarketer excludes home goods from its definition of core back-to-school product categories despite the big role that dorm shopping plays in back-to-school sales. Although important, home goods do not see a significant bump in sales during the season relative to other parts of the year, according to eMarketer.

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TECHNOLOGY

Supervalu embarks on IT transformation

BY By Deena M. Amato-McCoy

Eager to strengthen operations across its enterprise, Supervalu is moving to the cloud.

Through a strategic relationship with Sungard Availability Services (Sungard AS), the grocery company is replacing its mainframe technology infrastructure with a new mainframe platform that will offer cloud, back-up, and other solutions and services. The new configuration is designed to improve operations across the independent retailers it supports.

Together, the two companies will replace Supervalu's legacy mainframe IT environment under a transformation program aimed at reducing costs, improving flexibility, and supporting service to its network of more than 2,000 grocery stores. This transition will enable the company to use technology smartly and better compete in an increasingly demanding and competitive grocery environment.

Through the agreement, Supervalu will upgrade the technology without requiring an upfront investment. It also offers Supervalu an opportunity to move many of its workloads into a secure, highly-scalable cloud platform. The company will also replace fixed-cost, in-house equipment with variable-cost services that can be scaled as needed. The platform enables Supervalu to also deliver a full suite of Sungard AS cloud and recovery services to its retailers.

"We plan to strengthen operations across our enterprise and add shareholder value by transforming our approach to technology," said Chad Mead, CTO at Supervalu. "Technology has become an essential factor in competing in this market, and our planning with Sungard AS suggests that we can build a more flexible and responsive mainframe infrastructure that drives growth."

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