Current Events in October 2013

As lawmakers forced the government to shut down for the first time in 17 years, as a market researcher I wondered how Americans see the political parties themselves? In less than 24 hours, the Democratic party saw its’ brand strength decrease by 9%, the Republicans brand by a bit more -- 16%. 

Brand Keys used a statistically validated emotional brand engagement assessment to measure the political party brands. It’s a combination of psychological inquiry and higher-order statistical analyses that “fuses” emotional and rational values dealing with how the electorate views their Ideal political party. We’'ve used this model of engagement-ties-closely-to-behavior for every Presidential election since Bill Clinton (1992) and the metrics have predicted the winner in every election except 2000, when George W. Bush beat Al Gore by a razor-thin margin.

Brand engagement assessments, whether for pizza or political parties, measure what consumers think – rather than what they say they think, and from a brand perspective provides an accurate read as to how consumers, or in the case of political parties and their candidates, the electorate, will behave. So we measured Democrats'’ and Republicans'’ concepts of the Ideal political party and compared the individual party “brands” to that ideal directly following the announcement of the shutdown. 

Four Drivers of Brand Engagement

There are four engagement drivers that define the Ideal Political Party, and voters hold expectations for each driver. Not surprisingly, the order of the engagement drivers (and accompanying expectations) vary in terms of what’s important to Democrats and Republicans, hence different party views and political brand affiliation. The drivers can be briefly described:

Action
Does the party have a comprehensive, realistic, well-considered plan for solving the problems facing the country?

Compassion
Does the party care about all of the people? 

Perception
Does the party have a deep understanding of the problems facing the county? 

Resolve
Does the party have the strength and leadership to guide the country? 

Democrats see their Ideal Political Party as follows:

1. Perception
2. Resolve
3. Compassion
4. Action

Republicans view their Ideal Political Party this way:

1. Resolve
2. Perception
3. Action
4. Compassion

For Democrats, the driver with the highest expectations is “Compassion.” For Republicans it is “Action.”

Brand Strength

Like consumer brands, we can calculate a Brand Strength measure, in this case the degree to which the political party is seen to meet – or exceed – expectations that Democrats and Republicans hold for their Ideal Political Party, with the Ideal calculated as 100%. The last time we took this measure was during the 2012 Presidential election, so it provides an up-to-date benchmark against which to measure how the U.S. Government to shut down affected Democrats’ and Republicans’ respective views of their political party brands.

Here’s how things currently stand, with 253 registered Democrats evaluating the Democratic party and 267 registered Republicans (screened as being non-government workers) rating their party – again, after the government shutdown:

The Democratic party saw its’ brand strength decrease by 9%, the Republicans brand by a bit more, 16%. 

Rule of Six

One brand engagement certainty we'’ve seen play out over the years is the “Engagement Rule of Six.” That rule states where brands are stronger than competitors, consumers are six times more likely to give them the benefit of the doubt in uncertain circumstances, which we think is a pretty fair description of a Federal government shutdown.

Will Rogers noted, “"I am not a member of any organized political party. I am a Democrat.”" That was 81 years ago, and Democrat or Republican, the sentiment is worth taking to heart. Because whether a political party or a consumer brand, if you are so disorganized that you are unable to meet customer expectations, you always lose in the marketplace or, as is likely in this case, the voting booth.

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Robert Passikoff is president of Brand Keys, a research firm.

There’s an old joke where a wife catches her husband in bed with another woman (or vice-versa) and the cheating spouse has the chutzpah to deny everything: “What? There’s nobody else in bed with me right now! You did not just see a naked stranger jump out from under the covers, throw on some clothes and run out of here. I’ve never cheated on you! Who’re you gonna believe — me, or your own lying eyes?”

But for the twenty-first century, maybe we should update that joke to apply to GPS systems: “When you look out your car window, you see a deserted beach next to a vast ocean. But I, your GPS, say it’s actually a well-traveled multi-lane highway. Who’re you gonna believe — me, or your own lying eyes?”

Unfortunately, too many drivers in such situations choose to believe the GPS. This happened most recently in Douglas County, Oregon, on Sept. 28, when the sheriff’s department got a call from an elderly couple whose RV got stuck in the mud on a deserted, unpaved logging road. Their GPS had suggested they leave the Interstate and take a shortcut through the wilderness.

Of course, elderly drivers aren’t the only ones prone to being fooled by their GPS systems. In 2011, a young woman in Washington State drove her SUV into a lake after she and her GPS mistook a boat launch for a road.  Other stories from that year include the man in New Jersey who blamed his GPS after he drove his car off the road and into a house, and the Pennsylvania woman who blamed hers for the head-on crash she caused while driving north in a southbound lane.

Indeed, bad-GPS-direction stories are becoming downright commonplace. Just last week, an Alaskan airport had to put up barricades after clueless iPhone users fooled by a flaw in Apple Maps data kept driving onto one of its runways.

Therefore, even though we are not psychic, we still feel pretty confident in predicting “Sometime in the next month, more ‘drivers get lost following bad GPS advice’ stories will appear in the news.” To make sure these headlines aren’t about you, remember: if the road signs say one thing and the GPS says something else, ignore the GPS and trust in the testimony of your own lying eyes.

It’s officially illegal to publish “revenge porn” photos in California, now that Gov. Jerry Brown has signed Senate Bill 255 into law.

California SB 255 makes it a misdemeanor to publish an identifiable nude photo or video of somebody without their permission. Of course, it’s already illegal to secretly take, let alone publish, nude photos of people in a bathroom, dressing room or any other place where they have a reasonable expectation of privacy.

What makes SB 255 different is that it applies to nude photographs or videos taken of people with their consent — even if someone freely gives you a nude photograph of themselves, or lets you take one, you still can’t post it online without their permission.

Revenge porn is, arguably, one of the nastier Internet trends of the past few years. As its name (and the wording of SB 255) suggests, it’s a practice wherein people, usually angry ex-lovers, publish nude photos of their former partners with the express intention of humiliating them. Online advocacy groups like “End Revenge Porn” or  “Women Against Revenge Porn” share horrifying real-life stories from revenge-porn victims.

Too far-reaching?

Though few people would actually defend the practice of actually publishing revenge-porn photos of people, there are concerns that SB 255 might be too far-reaching to pass constitutional muster. When SB 255 first passed the state senate last August, the bill passed by a margin of 37-1. The lone dissenting vote was cast by Sen. Leland Yee, who said the bill as written might be broad enough to violate First Amendment rights; a similar bill in Florida failed when state lawmakers cited free-speech concerns.

As of press time, it’s not known when or if anyone will sue to have the bill overturned on constitutional grounds.

Banks operating in New York have a choice -- treat New Yorkers fairly or face the consequences, Attorney General Eric T. Schneiderman warned as he said he was suing Wells Fargo while holding off similar action against Bank of America to give it time to implement reforms.

Schneiderman said the banks have not honored their commitments under the 2012 National Mortgage Settlement. The suit will ask a federal judge to order Wells Fargo to clean up its mortgage processes. Schneiderman is holding off on filing a similar suit against Bank of America, which he said has agreed to implement a robust set of systemic reforms intended to ensure that the servicing standards outlined in the National Mortgage Settlement are honored across New York State.

If the reforms are successful, it is anticipated that Bank of America will replicate this initiative nationwide, Schneiderman told a news conference today. 

Unnecessary challenges

"While we have brought much needed relief to thousands of New Yorkers, too many homeowners in our state are facing unnecessary challenges as they fight to keep their homes," Schneiderman said. "While Bank of America has chosen to work with us to take the steps required to adhere to their commitments, Wells Fargo has taken a different path. Both of these cases should send a strong message that the big banks must comply ... or face the consequences." 

The National Mortgage Settlement includes 304 Servicing Standards that participating servicers are required to adhere to, and which include standards that are intended to make it easier for homeowners to seek loan modifications. The Servicing Standards were incorporated into the National Mortgage Settlement to address longstanding complaints from consumers and advocates that servicers subject to the Settlement -- Ally Financial/GMAC, JP Morgan Chase, Citibank, Bank of America and Wells Fargo -- consistently failed to provide fair and timely services to their customers.

Sad and shameful

Schneiderman said he gave ample time to Wells Fargo to agree to reforms, but after months of negotiations, the bank declined to sign any agreement aimed at improving its customer service practices. 

"Wells Fargo's violations of the servicing standards has been documented by direct service providers across New York State," said Kirsten Keefe of the Empire Justice Center."Wells Fargo's refusal to commit in writing to common-sense reforms that every mortgage servicer should be following already is sad and shameful. Wells Fargo's business practices are hurtful to its customers who should be getting resolutions but will continue to suffer frustrations with litigation pending."

Violations of the timeline servicing standards increase the likelihood that distressed homeowners will lose their homes because the longer mortgage modifications are delayed, the deeper homeowners fall into arrears. Additional fees, penalties and interest accrue during periods of delay, making modifications more difficult and pushing homeowners closer to the brink of foreclosure.

"For too long, homeowners in New York and around the country have been struggling as the big banks fail to honor the commitments they made in the National Mortgage Settlement," said Ira Rheingold, Executive Director of the National Association of Consumer Advocates. "Every day that a struggling homeowner has to go back and forth with their mortgage servicer is a day they fall further behind and a day closer to needlessly losing their home."

Reduced penalty fees and better explanations of the cost of credit cards are two of the benefits consumers have reaped from the 2009 CARD Act, according to the Consumer Financial Protection Bureau (CFPB).

In its report, the CFPB says the CARD Act, known formally as the Credit Card Accountability Responsibility and Disclosure Act of 2009, also resulted in a decline of 2% in the total cost of credit but notes there are still areas of concern in the credit card market.

“Credit cards play a valuable role in the everyday lives of American consumers,” said CFPB Director Richard Cordray. “The CARD Act brought better consumer protections and fairness to the marketplace, but we found there is more work to be done.”

Sweeping changes

Over 70% of adults have at least one credit card and the CARD Act, which was signed into law in May 2009, made sweeping changes to protect them, including by preventing unexpected interest rate hikes, curbing unfair or excessive late fees, and creating an opt-in requirement for over-limit fees. It also instituted new disclosure requirements designed to make credit card costs clearer for consumers. The CFPB assumed authority for the CARD Act in July 2011.

In preparing its report, the CFPB used data covering most of the credit card marketplace. Based on this information, the report found that:

• Total cost of credit declined by two percentage points between 2008 and 2012. That includes all fees, interest and finance charges paid by the consumer to the card issuer. The decline has occurred even as annual fees and interest rates have increased, indicating a shift from back-end pricing toward more transparent front-end pricing that consumers can understand and evaluate more easily.
• Over-limit fees have been effectively eliminated. Before the CARD Act took effect, card issuers could charge an over-limit fee for transactions that put cardholders over their credit limit. Each over-limit transaction could result in an additional over-limit fee. With the law’s requirement that consumers opt-in to fees before they are allowed to exceed their credit limit, the CARD Act essentially eliminated over-limit fees as a source of cost to consumers and revenue to issuers. The report found that consumers paid about $2.5 billion less in over-limit fees than they paid in 2008.
• Size of late fees declined. The CARD Act required that penalty fees be “reasonable and proportional” to the relevant violation of account terms. The report found that the average size of late fees diminished -- that the average late fee went down by $6 after the CARD Act took effect. That works out to a $1.5 billion decrease in late fees in 2012.
• Responsible access to credit remains available. As the financial meltdown hit, creditors faced losses and as a result implemented more restrictive credit standards. While the amount of available credit card credit has generally decreased, there is still $2 trillion of unused credit for consumers with credit cards in the marketplace. One factor affecting credit availability is a notable drop in the number of consumers who receive unsolicited credit limit increases on their accounts. Now that consumers have to ask for their credit limit to be raised rather than having it happen automatically, these increases are happening less frequently.
• Young consumers are better protected from credit cards they cannot afford. Before the CARD Act, it was often too easy for young consumers to rack up unmanageable credit card debt and damage their credit rating. Now, consumers under the age of 21 cannot get a credit card unless they can demonstrate an independent ability to repay the debt or unless they have a cosigner over 21. As a result, the percent of young adults ages 18-20 who have at least one credit card account has dropped by half.

Consumers have responded positively to these changes. When JD Power & Associates released its 2013 U.S. Credit Card Satisfaction Study  , it showed credit card satisfaction at an all-time high since the inception of the study in 2007. The study reported that customers seemed to be increasingly happy with their credit cards, and JD Power attributed some increased satisfaction to the CARD Act.

Areas of concern

While the CARD Act addressed many problematic practices in the market, the CFPB has outstanding areas of concern from today’s report, including:

• Add-on products: Add-on products are optional services, such as debt cancellation, identity theft protection, and credit monitoring, sold by credit card companies to cardholders. The CFPB has found in some enforcement cases that consumers were being misled by companies into buying these products. Concerns remain about the ways these products are marketed.
• Fee harvester cards: The CARD Act report recognizes that application fees or other fees charged before an account is opened do not count toward determining whether a card issuer is violating the CARD Act’s rules limiting fee harvester cards. The CFPB will continue to monitor the use of application fees in connection with account openings to determine if it should take action under its available authorities.
• Deferred interest products: These are credit cards that finance purchases without interest for a period of time. With these products, if the balance is not paid in full by a given date, the accumulated interest is assessed retroactively.

Disclosures

In addition, the CFPB has concerns about disclosures in three different areas:

• Online disclosures: While the CARD Act requires certain disclosures to appear on monthly statements, those consumers that pay their bills online may not see them. About 25% of consumers pay their bill online or through automatic bill payment. The CFPB intends to watch how card issuers provide consumers with disclosures when they access their account in different ways.
• Disclosures concerning rewards products: Many consumers are choosing their credit cards based on rewards programs, which can be highly complex, with detailed, confusing rules about how consumers can actually use their rewards. The CFPB will review whether rewards disclosures are being made in a clear and transparent manner and assess whether additional action is warranted.
• Disclosures concerning grace periods: Most cards allow consumers to avoid paying interest on purchases when they pay their balance in full each month. The period between the end of a billing cycle and the payment due date is called the “grace period.” The CFPB wants to ensure that consumers know that once they carry a credit card balance into a new month, they no longer enjoy the grace period on new purchases.

What to do

The CFPB accepts consumer complaints on credit cards and other financial products and services. You can submit a complaint by:

• Going online at www.consumerfinance.gov/complaint
• Calling the toll-free phone number at (855) 411-CFPB (2372) or TTY/TDD phone number at (855) 729-CFPB (2372)
• Faxing the CFPB at (855) 237-2392
• Mailing a letter to: Consumer Financial Protection Bureau, P.O. Box 4503, Iowa City, Iowa 52244

Now that the new health care exchange marketplaces are open for business under the Affordable Care Act, popularly known as Obamacare,  that doesn't mean you should rush online and buy a new policy.

For starters, there are the predictable glitches with the websites offering the plans. That makes it hard for many consumers to navigate the system. But there may be bigger issues at play.

Researchers at the Columbia Business School set up simulated exchanges, modeled on the design of the actual exchanges, to see how consumers would use them. The researchers said they were alarmed to discover that 80% of the consumers enlisted in the test were unable to figure out what they needed and ended up choosing a more expensive plan. 

Over-insuring

"Consumers' failure to identify the most appropriate plan has considerable consequences on both their pocketbooks as well as the cost of the overall system," said Eric Johnson, a professor and co-author of the report. "If consumers can't identify the most cost-efficient plan for their needs, the exchanges will fail to produce competitive pressures on health care providers and bring down costs across the board, one of the main advantages of relying upon choice and markets."

Johnson is well-acquainted with the system being put into place by the new law. He spent the last year advising several state health exchange systems on their design and structure. He serves as a member of an advisory board run by Pacific Business Group on Health.

The Columbia experiment consisted of six experiments in which consumers were told to choose the most cost-effective policy when they logged onto websites that were near-duplicates of the ones being operated by the real exchanges.

Startling

Johnson calls the results “startling.” The average consumer stands to lose $611 simply by failing to choose the most cost-effective option. That's bad for the consumers, but also taxpayers. Since the U.S. government is subsidizing costs that exceed a certain percentage of the policyholder's salary, the taxpayer will absorb a portion of the cost of that over-payment.

Johnson is well aware of how opponents of the Affordable Care Act might pounce on this research to make a political point but insists it in no way makes an argument for or against the program. Rather, he says it simply underscores the complexity of creating the delivery systems for health care policies.

Take it slow

The take away from the research may be that choosing a plan should not be done quickly and probably should not be done without some assistance. The ACA provides for qualified groups and individuals to serve as “navigators” for each exchange, helping consumers and answering their questions. Talking with one of these navigators – or at the very least doing some research before making a selection – may help with making a good decision.

Johnson and his team have some additional advice:

• Estimate your health care needs: How often do you go to the doctor? Once a year? Then why would you need a plan with no deductible and no co-pay? The monthly cost of such a plan would be a lot more than what you'd pay out of pocket for your annual visit.
• Get educated: Take advantage of 'just-in-time' education: tutorial links and pop-ups that explain basic terms like "deductibles" that might not be known to new buyers, increase your chances of choosing the best plan.
• Use available tools: Adding a calculator to the process improves your chances of choosing the right plan and reduces the size of errors by over $216, the researchers found.

What exchanges can do

Johnson says the exchanges can help consumers make better choices by tweaking the design of their sites and offering helpful tools.

"Designers of the exchanges should take heart and know that they can significantly improve consumer performance by implementing some easy, straightforward tools such as just-in-time education, smart defaults, and cost calculators," he said.

Consumers should also not rush into the marketplace because, chances are, they don't need to make a change from their present coverage. The marketplaces are mostly designed for people not currently covered by a health care policy – a number estimated at about 48 million.

Baby Boomers probably remember how uncomfortable their parents were when they worked up the courage to have “the talk.” The conversation may have been about sex, drugs or both.

Now, the shoe is on the other foot. It's Boomers who are trying to work up the nerve to talk to their parents about driving. So far, they aren't there yet.

Liberty Mutual Insurance conducted a survey in which it asked Boomers, whose parents were still driving, if they worried about their parents still being behind the wheel. Fifty-five percent said they did.

But when the survey asked if the child had discussed those concerns with their parents, only 23% had. Another 29% admitted they were likely to avoid the topic as long as possible.

"Nine in 10 Boomer children of senior drivers think it is important to have driving conversations with their aging parents, but few are taking action -- thus, not addressing potential safety risks on the roads," said David Melton, driving safety expert with Liberty Mutual Insurance.

Let's talk

From an insurance company's standpoint, it's a conversation that needs to happen.

"If people take away one lesson from this study, it is to have this conversation with your loved ones – and have it soon," Melton said.

Anecdotal evidence suggests seniors are now driving into their 90s. The National Institute on Aging, part of the National Institutes of Health (NIH), says there are a number of physical effects of aging that degrade a driver's ability.

Your eyesight may change as you get older. At night, you may have trouble seeing things clearly. Your hearing may change, making it harder to notice horns, sirens, or noises from your own car.

In order to drive safely, you should be able to react quickly to other cars and people on the road. You need to be able to make decisions and to remember what to do. Being able to make quick decisions while driving is important so you can avoid accidents and stay safe. Slowing reaction time can present a danger on the road.

Safer than young drivers

That said, the statistics have yet to suggest that older drivers are getting into more accidents. While drivers in their 70s and 80s have a higher insurance claim rate than those in their 50s and 60s, it is still lower than drivers under 30, according to the Insurance Institute for Highway Safety (IIHS).

Accidents involving senior drivers may make headlines, but it doesn’t mean the elderly are causing more accidents, a 2012 IIHS report found. The rate of fatal crashes per licensed driver 70 and older fell 37% from 1997 to 2008. 

Still, if your parent is in her late 80s and still driving, you probably worry. In the Liberty Mutual survey 47% of Boomers worried about their parent's eyesight. Thirty-eight percent thought they drove too slowly and 25% worried their parents were easily distracted when behind the wheel.

So, why haven't they talked about it? According to the survey only 38% of those questioned think their parents would be open and receptive to any discussion about curtailing their driving.

What to do

Here are a couple of ideas for broaching the subject:

• Make a first-hand observation: Take a ride with your parent and observe their driving. If it really is unsafe, then you have an example to cite and your case carries more credibility.
• Be prepared: Before suggesting your parent surrender their car keys, look into alternate transportation solutions and be prepared to discuss options. Remember what driving represents -- freedom.

When you were a teenager, earning your driver's license was a major milestone in your life. Having access to a car gave you freedom and independence. For your parents, handing over the keys is also a major milestone – the reverse of what you felt at 16.

In an effort to prevent deaths and injuries to children, the U.S. Consumer Product Safety Commission (CPSC) has voted 4-1 to approve a new federal mandatory standard governing the safety of bassinets and cradles.

The new federal standard incorporates provisions in the voluntary standard (ASTM F2194-13), Standard Consumer Safety Specification for Bassinets and Cradles. Five modifications recommended by CPSC staff address risks the agency says are not adequately covered by the voluntary standard. They include:

• a clarification of the scope of the bassinet/cradle standard;
• a change to the pass/fail criterion for the mattress flatness test;
• an exemption from the mattress flatness requirement for bassinets that are less than 15 inches across;
• the addition of a removable bassinet bed stability requirement; and
• a change to the stability test procedure, requiring the use of a newborn CAMI dummy rather than an infant CAMI dummy.

Incidents

CPSC received notice of 426 incidents involving bassinet/cradles, including 132 fatalities from November 2007 through March 2013.

Brianna of California City, Calif., had a frightening experience with a the Fisher Price Cradle 'N Swing. When she put her child in the swing, she writes in a ConsumerAffairs post, "the cradle part tipped all the way to the side. My daughter could have fallen out and hit her head on the bar that supports the swing if I was not sitting next to her to grab her." She says she is "very unsatisfied" and would never recommend one to anyone.

New definitions

The new standard defines “bassinet/cradle” as a small bed designed primarily to provide sleeping accommodations for infants, supported by free standing legs, a stationary frame or stand, a wheeled base, a rocking base, or swing relative to a stationary base.

In a stationary (non-rocking or swinging) position, a bassinet/cradle is intended to have a sleep surface less than or equal to 10 degrees from horizontal.

A bassinet/cradle is not intended to be used beyond the age of about 5 months or when a child is able to push up on his hands and knees. Bassinet and cradle attachments for non-full-size cribs or play yards are considered to be part of the bassinet/cradle category, as are bedside sleepers that can be converted to four-sided bassinets not attached to a bed.

The effective date for the mandatory bassinet/cradle standard is 6 months after the final rule is published in the Federal Register. Manufacturers are allowed an additional 12 months to comply with the provision for removable bassinet beds.

You don't need to be chained to your computer to go e-shopping. More and more these days, consumers are using tablets and smartphones to interact with retailers.

A report produced in partnership with comScore and The Partnering Group finds more than half (55%) of all retail-related Internet time originated on smartphones and tablet devices combined, compared with just 45 percent originating from desktop devices.

Growth spurt

Specifically, smartphone usage in June 2013 totaled 44% of retail Internet minutes, versus 17% in June 2010; and tablet Internet usage accounted for 11% of total minutes on retail sites.

During the second quarter of this year, mobile commerce (m-commerce) dollars totaled $4.7 billion or 8.6% of total U.S. e-commerce dollars during that period. Additionally, between the second quarter of 2012 and the same three months this year, m-commerce grew 24%, compared with 16% growth in e-commerce as a whole.

"Since U.S. consumers now spend more than half of their time on retailers’ websites using their smartphones and tablets, mobile can’t be viewed simply as an ancillary device or action, it now epitomizes how consumers think and act when they interact with retailers,” said Shop.org Executive Director Vicki Cantrell. “Retailers have to continue to invest to make sure they get their mobile offerings right, or will increasingly risk alienating customers and leaving significant money on the table."

Retail a leader

When it comes to popular mobile content categories, retail was one of the fastest-growing areas among consumers. From June 2012 to June 2013, retail grew 49% as a content category on smartphones, only behind beauty and fashion, home and lifestyle, and instant messaging services.

The report found that online consumers use their smartphone and tablet devices for many shopping-related activities. As for in-store mobile activities, in the April-June quarter of this year nearly, six in 10 (57%) of smartphone users visited the same company’s site or app while in the store, compared with 43% who consulted another company’s site or app. The top reason consumers consulted the retailer’s or another company’s website or app was to view price differences.

“Retailers have an immediate opportunity to proactively encourage shoppers to use in-store Wi-Fi and engage with the retailer’s mobile-enabled websites and apps,” said Peter Leech, managing director of The Partnering Group, “It’s a big opportunity to capture those eyeballs before they seek an alternate source of product detail and pricing information on another retailer’s mobile offering.”

Bargain hunting

Among those smartphone users who went to the same retailer’s site, 59% wanted to see if there was an online discount available. Similarly, among those who checked a different retailer’s site, 92% wanted to see if they could get a better deal on price. Smartphone owners also used their devices while in the store to take a picture of a product (23%), text or call family or friends about a product (17%), and send a picture of a product to family and friends (17%).

“Mobile is having a profound effect on how people engage with the retail experience today,” said Lynée Alves, director of retail solutions at comScore. “Not only are consumers using their mobile devices to engage more with retail sites and apps, they are also beginning to transact on these devices in a meaningful way. The m-commerce revolution is building momentum, and retailers must adapt to this new landscape if they are to succeed in this emerging channel.”

Marketplace evolution

The report also found:

• One-third (35%) of smartphone owners in in the second quarter of 2013 used their device to locate a store, one-quarter (24%) used it to find coupons and deals, and 19% used it to look up product availability.
• Among consumers who made a purchase online in during the period, 69% of those purchases came from desktop devices, versus 34%t from tablets and 21% from smartphones.
• The average amount spent during the quarter was higher on smartphones than on tablets: shoppers spent an average of $97 on smartphones and $76 on tablets.
• Nearly two-thirds of smartphone owners in used a browser to research product features (64%), and more than half used a browser to find a store location (59%) and to find coupons/deals (53%). Seven in 10 (72%) smartphone owners report using only apps to make shopping lists, as well as 46% who do so to view daily deals.
• Apparel and accessories (37%) and event tickets (25%) were among the top products that smartphone shoppers bought with their device during the second quarter.

New applications for mortgages slipped last week, giving back some of the gains they'd tallied in the previous two weeks.

According to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey, applications were down 0.4% for the week ending September 27, 2013.

During the same period, Refinance applications were up 3%, pushing the refinance share of mortgage activity to 63% of total applications -- up 2% from the previous week and the highest level since August 2013. The adjustable-rate mortgage (ARM) share of activity fell to 6% of total applications.

Contract interest rates

The average contract interest rate for 30-year fixed-rate mortgages (FRMs) with conforming loan balances ($417,000 or less) decreased to 4.49%, the lowest rate since June 2013, from 4.62%t, with points decreasing to 0.34 from 0.41 (including the origination fee) for 80% loan-to-value ratio (LTV) loans. The effective rate decreased from last week.

The average contract interest rate for 30-year FRMs with jumbo loan balances (greater than $417,000) decreased to 4.53%, the lowest rate since June 2013, from 4.66%, with points decreasing to 0.22 from 0.29 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.

The average contract interest rate for 30-year FRMs backed by the FHA decreased to 4.21%, the lowest rate since June 2013, from 4.32%, with points decreasing to 0.35 from 0.37 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.55%, the lowest rate since June 2013, from 3.68%, with points increasing to 0.33 from 0.28 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.

The average contract interest rate for 5/1 ARMs decreased to 3.26%, the lowest rate since June 2013, from 3.39%, with points decreasing to 0.28 from 0.35 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.

The survey covers over 75% of all U.S. retail residential mortgage applications.

Millions of Americans are starting to sign up for health insurance and financial assistance as the Affordable Care Act, commonly known as Obamacare, goes into effect today, creating a fertile field of scam artists and identity thieves.

In some cases, criminals will try to collect personal or financial information to steal your identity and your money. In other cases, unscrupulous sales people will try to sell “discount medical plans.” Those so-called discount plans may be insurance plans that really do not save you money, or they may not be legitimate health insurance plans at all, Illinois Attorney General Lisa Madigan warned.

What to do

• Do not pay for help. The government will not charge for its services. You never have to pay to receive help. If you receive an offer to sign up on for insurance under Obamacare for a fee, you should hang up, delete or walk away. Do not give cash, your credit card or banking information to someone you do not know or did not contact.
• Make sure any specialist you work with is certified. If you are working with a specialist made available by your state, make sure the specialist is certified. Most states are listing the names and contact information of their specialists on their state health exchange sites. You can find your state site through HealthCare.gov.
• Never open your door to a stranger, even if they claim to be a certified specialist.
• Guard your personal information. Do not give out your Social Security number, bank account number, or other sensitive personal or financial information to someone who calls you, emails you or comes to your door. However, be aware that when you enroll for an insurance plan through the Health Insurance Marketplace, you will be asked to provide your Social Security number and payment information, among other personal information. Before you do this, make sure you are on the official website and if you sign up in person, ask the specialist who is helping you to look away while you enter this information online.
• The state health exchanges do not offer Medicare. Medicare is not affected by the Affordable Care Act, and you cannot enroll in Medicare through the state exchanges. You should not share your Medicare number with anyone who contacts you uninvited. If you have Medicare questions, please call Medicare at 1-800-MEDICARE (1-800-877-9392).
• Use the state exchanges for one-stop safe insurance shopping. Consumers who enroll for insurance through their state exchanges can be sure they are accessing approved insurance plans and at the same time determine, based on their income, whether they are eligible for Medicaid coverage under the newly expanded program, or for tax credits to help offset their premium payments.

Serious question: Am I the only person who read  about Edelman’s latest “multimarket consumer and brand study” and thought, “Change just a couple of words here, and this works perfectly well as a ‘How to have an emotionally fulfilling marriage’ article for a women’s magazine”?

Could be just me; I’ve admitted before that I lack not merely brand loyalty, but the ability to fully comprehend it. But even so — check out this excerpt from one article about the study:

"The survey found that roughly the same percentage of respondents (92%) want to do business with brands “that share their beliefs” [….] consumers want brands to pay attention to them. Forty percent said they want brands to “listen and respond more thoughtfully,” to what they have to say."

Pay attention, listen carefully and respond thoughtfully to what they have to say, it definitely helps if you both share the same core beliefs and values … seriously, that’s some damned fine healthy-relationship advice right there. Certain couples have paid thousands of dollars to marriage counselors to help them figure that out.

(Incidentally, over the past decade, 45 percent of all American marriages were between people of different religious faiths, leaving a mere 55 percent of spouses who married people “that share their beliefs” compared to 92 percent of consumers.)

Make it perfect

Granted, the “healthy marriage equals brand loyalty” analogy isn’t perfect. Like this tidbit:  “91% of consumers want [to] participate in the development and design processes of the products they purchase. The survey found that to be the case equally in developed and emerging markets.”

Marriages based on the idea “I can change him or her, mold my partner into a completely different person from today’s status quo” rarely work out — or so I think. Then again, I’m also one of the only 8 percent of consumers who’s never wanted to join the design and development divisions of the corporations from whom I buy stuff. I do belong to the majority here, though: “According to the study branded content isn’t high on the list of things that people want from brands — only about 2 in ten said that was something they wanted more of.”

So 80 percent don’t care about branded content when they buy stuff, compared to the 92 percent who prefer brands that share their beliefs. Although in practice, it’s possible that consumers aren’t concerned about companies “sharing” their beliefs, so much as companies not going out of their way to disparage them. Consider the pasta controversy that raged last week after Barilla Pasta’s chairman said, “We won’t include gays in our ads, because we like the traditional family. If gays don’t like it, they can always eat another brand of pasta.”

The company quickly backtracked once it realized that if gays and friends of gays actually did choose to eat different pasta brands, Barilla would subsequently lose sales and money.

Which simply underscores how “don’t go out of your way to be offensive” remains very good advice for dealing with your spouse or any human beings, whether they’re your customers or not.

Payday lenders around the country have been routinely ignoring state laws against payday loans. That's not going over well in New York, where five companies have been ordered to pay $279,605.98 in restitution and $29,605.98 in penalties.

One of the companies was ordered to stop trying to collect $3.2 million in outstanding loans and all of the companies will be prohibited from collecting on payday loans from New Yorkers in the future.

“Payday loans trap thousands of New Yorkers in a cycle of debt and prey on vulnerable consumers, all for the financial benefit of debt collectors. Unfortunately for those companies, payday loans are also illegal, and my office will continue to crack down on an industry that exploits desperate consumers across our state," said Attorney General Eric T. Schneiderman. "These agreements are one more step in our continuing fight to protect New Yorkers from a range of unfair financial schemes – from predatory loans, to illegal foreclosures and other abuses by big financial institutions."

Payday loans violate New York’s usury and licensed lender laws. Typically, payday loans have annual rates of interest from 100 percent to 650 percent or more. These interest rates far exceed the maximum rate allowed under New York law, which is limited to 16 percent for most lenders not licensed by the state.

In August, Attorney General Schneiderman filed a lawsuit against Western Sky, LLC., CashCall, Inc., and WS Funding LLC. for taking advantage of consumers by charging extremely high rates of interest that were well above New York State’s usury caps.

Payday loans are a type of short-term borrowing where an individual borrows a small amount from a payday lender at a very high rate of interest. Many consumers cannot afford to pay off the loan when it becomes due and must extend, or roll over the payment period by paying additional interest. Even when a consumer can pay, many payday lenders renew the payday loan automatically, deducting only interest from the consumer's bank account without paying down the principal. Consumers take out new payday loans to pay off the old and often end up being trapped in a cycle of debt.

Below is list of the companies involved in the settlement:

V&R Recovery, Inc. DBA Alexander & Stefano, 3411 Delaware Ave, Kenmore, NY 14217

RJA Capital, Inc., 461 Ellicott Street, Buffalo, NY 14203,

Westwood Asset Management, LLC,2316 Delaware Ave, Buffalo, NY 14216

Erie Mitigation Group, LLC,3711 California Road, Orchard Park, NY 14127

Northern Resolution Group, LLC,501 John James Audubon Pkwy, Amherst, NY 14228

Hitting a deer with your car or truck can cause extensive property damage and even serious injuries and death. Fortunately, your odds of hitting a deer are on the decline, according to a survey by State Farm Insurance.

In fact, your odds of colliding with a deer in the next 12 months declined from one in 167 last year to one in 174 this year. The biggest drops occurred in North Dakota and Nebraska.

According to the U.S. Centers for Disease Control and Prevention (CDC), four percent of motor vehicle collisions on U.S. roadways in 2000 involved striking a large animal, primarily a deer. Each year, CDC estimates, 200 people die in these collisions. 

Deer population explosion

An explosion in the nation's deer population – not just in rural West Virginia, where deer-vehicle collisions are highest but in populated suburban areas as well – has increased the risk for drivers. Because insurance companies end up paying for the damage, the industry has tried to raise awareness of the threat and take steps to mitigate it.

According to the Insurance Information Institute (III), the average cost per insurance claim for collision damage is $2,800, with costs varying, depending on the type of vehicle and severity of damage. When you factor in auto claims involving bodily injury, the average rises to $10,000.

Many drivers who have hit deer say the animals appeared in front of their speeding vehicles without warning. By the time they saw the deer it was too late to avoid hitting them.

Most common damage

Hitting a deer at 50 or 60 miles per hour will cause extensive damage to the front end of a vehicle. In most cases there are multiple punctures of the car's radiator, causing coolant to leak out. Driving a car after a deer collision will likely cause overheating and possible engine damage.

Serious bodily injury to vehicle occupants can occur if the deer's body rises over the hood of the car and slams into the windshield. A driver trying to miss an animal in the roadway may lose control or run off the road.

While some deer collisions are impossible to avoid, the III says there are some things you can do to reduce your risk. Keep in mind that autumn – particularly November – is when deer are most likely to run into the path of oncoming cars. From sunset to midnight and during the hours shortly before and after sunrise are also the time that deer tend to be on the move.

When you see “deer crossing” signs along the highway, take them seriously. They were probably erected after numerous accidents at that location. The signs are usually placed in areas known to have large deer populations.

The second one is the one you hit

Remember that deer rarely travel alone. If you see a deer cross the road ahead of you, chances are another one or two animals will soon follow. Motorists don't always hit the first deer they see – often it's the second.

When driving at night, turn on your high beam headlights when there is no oncoming traffic. The bright lights may illuminate the eyes of deer on or near the roadway, giving you a earlier warning.

You may see advertisments for deer whistles, deer fences and reflectors to deter deer. III says these devices have not been proven to reduce deer-vehicle collisions.

If you hit a deer, pull over and call the police, just as you would in any other auto accident. Contact your insurance agent or company representative to report any damage to your car. Collision with an animal is covered under the comprehensive portion of your auto insurance policy.

Despite the increase in the deer population State Farm estimates the average driver's chances of being in a deer-vehicle collision has actually gone down over the last five years.

“This data is encouraging,” said Chris Mullen, Director-Strategic Resources at State Farm. “We would like to think the attention we call to this issue each fall has had an impact. Obviously there are other factors at play as well.”

Maybe the D.C. crowd could learn something from Texas after all. While the federal government was closed down by bickering politicians, Texas did some serious jawboning and hammered out a deal to endorse the merger of Amerian Airlines and US Airways.

The proposed $11 billion merger is being challenged by the U.S. Justice Department (closed today), five states and the District of Columbia. 

Texas Attorney General Greg Abbott announced the settlement today, saying it resolves the state’s objections by American Airlines agreeing to maintain daily service to rural airports across the State of Texas. Additionally, the airlines entered into a binding agreement to maintain the merged company’s headquarters in the Dallas-Ft. Worth metropolitan area.

“From the beginning, our focus has been on maintaining service to rural airports in Texas and protecting Texas jobs. Today’s agreement ensures that thousands of jobs will remain in Texas and that Texans traveling by air – especially those who fly in and out of rural cities across the state, including members of the military – will continue to benefit from daily flight service. The settlement secures common-sense concessions that are in the best interests of our great State,” Abbott said. 

“The settlement is good for American Airlines’ customers, the communities it serves and its employees. Our negotiations confirmed that the airline will preserve competition in the marketplace, maintain important routes in Texas and protect jobs,” he said.

Others challenging the merger are: Arizona, where US Airways is headquartered; Florida; the District of Columbia; Pennsylvania; Tennessee; and Virginia.

Military travelers

The state’s legal action, announced in August, was prompted by concerns about the potential for reduced airline service to several of Texas’ smaller airports. One particularly large group of travelers who depend on airline service to rural airports across the State are members of the armed services, who are served almost exclusively by American Eagle flights to and from Killeen, which is near Fort Hood; San Angelo, which is near Goodfellow Air Force Base; and Abilene, which is near Dyess Air Force Base.

Today’s agreement ensures that 22 airports across Texas – including more than a dozen smaller airports in rural Texas – will continue to offer daily departures and arrivals.

In addition to ensuring daily service to airports across Texas, the agreement also guarantees that Dallas/Fort Worth International Airport will remain a “hub” and that, if the airlines merge, the headquarters will be located in Texas, in the DFW metropolitan area. 
Texas airports covered by the agreement include:

• Abilene Regional Airport
• Austin-Bergstrom International Airport
• Brownsville/South Padre Island Airport
• Corpus Christi International Airport
• Dallas/Fort Worth Regional Airport
• East Texas Regional Airport
• Easterwood Airport
• El Paso International Airport
• Houston William P. Hobby Airport
• Houston George Bush Intercontinental Airport
• Jack Brooks Regional Airport
• Killeen-Fort Hood Regional Airport
• Laredo International Airport
• Lubbock Preston Smith International Airport
• McAllen-Miller International Airport
• Midland International Airport
• Rick Husband Amarillo International Airport
• San Angelo Regional Airport
• San Antonio International Airport
• Tyler Pounds Regional Airport
• Waco Regional Airport
• Wichita Falls Regional Airport

Given how common it is for American drivers to “eat on the go,” we must admit that KFC’s latest product offering is pretty brilliant: the KFC Go Cup,  a container designed to fit in a standard car cup holder and hold foods that can be eaten with one hand while the other presumably stays on the steering wheel, or maybe texting.

Not that KFC is explicitly encouraging customers to engage in one-handed driving; instead, a Go Cup commercial shows GoCup contents being consumed by a rookie cop in a parked police car.

However, FoodBeast posted a KFC-generated infographic claiming that “42 percent of Americans would be more likely to eat in their cars if the food container could fit in their cup holder” (except, presumably, the 33 percent of American listed in the other KFC infographic who already use their cup holders to hold drinks. Though if their cars are outfitted with two cup holders per person, then drivers won’t be forced to choose between eating a meal and drinking something to wash it down).

Patients who take statins -- things like Crestor or Lipitor may be doing more than preventing heart attacks or controlling their cholesterol levels.

Researchers who reviewed dozens of studies on the use of statin medications found that the commonly prescribed drugs pose no threat to short-term memory, and that they may even protect against dementia when taken for more than one year. The Johns Hopkins researchers who conducted the systematic review say that should offer more clarity and reassurance to patients and the doctors who prescribe the statin medications.

Hot topic

The question of whether statins can cause cognition problems has become a hot topic among cardiologists and their patients following changes on the drug labels ordered by the U.S. Food and Drug Administration (FDA) in February 2012, warning about memory problems with short-term statin use.

However, in their extensive review, the Johns Hopkins researchers found that statins do not affect short-term memory or cognition. In contrast, they say that when the drugs are taken for more than one year, the risk of dementia is reduced by 29%. Their findings are published in an online article in the Mayo Clinic Proceedings posted on October 1, 2013.

"All medications, including statins, may cause side effects, and many patients take multiple medicines that could theoretically interact with each other and cause cognitive problems," says Kristopher Swiger, M.D., a primary author of the study. "However, our systematic review and meta-analysis of existing data found no connection between short-term statin use and memory loss or other types of cognitive dysfunction. In fact, longer-term statin use was associated with protection from dementia."

Looking at side effects

For their study, the Johns Hopkins researchers conducted two different analyses involving a total of 41 different studies, which they narrowed down to 16 that had the most relevance. The first analysis looked at the impact of short-term statin use and cognitive function including memory, attention and problem-solving.

For that analysis, they included studies that used a standard, objective measurement tool known as the Digit Symbol Substitution Test. The other assessment focused on studies in which participants took statins for more than one year to see if there was any correlation with a later diagnosis of Alzheimer's disease or vascular dementia.

"Our goal was to provide clarity on this issue based on the best available evidence," according to Raoul Manalac, M.D., a co-primary author of the study. "We looked at high-quality, randomized controlled trials and prospective studies that included more than 23,000 men and women with no prior history of cognitive problems. The participants in those studies were followed for up to 25 years."

Statins reduce cholesterol levels in the blood, particularly low-density lipoprotein (LDL), which is known as the "bad" form of cholesterol that can build up as plaque inside blood vessels. The drugs have been shown to reduce coronary artery disease and stroke among those at high risk as well as for those who have already been diagnosed with cardiovascular disease following a heart attack or stroke. Statins have also been shown to reduce the amount of inflammation within blood vessels and prevent the risk of blood clots.

Protective qualities

"Because of their effect on arteries to reduce or stabilize plaque, and prevent strokes, it makes sense that statins could be protective in the brain against dementia," according to senior author Seth Martin, M.D., a Pollin Cardiovascular Prevention Fellow with the Johns Hopkins Ciccarone Center for the Prevention of Heart Disease and the study's senior author.

"Vascular dementia is caused by blockages in small blood vessels in the brain that prevent blood flow to certain areas. Medications such as statins that reduce plaque and inflammation in coronary arteries may also be having the same effect on blood vessels in the brain," says Martin.

Roger Blumenthal, M.D., the Kenneth Jay Pollin Professor of Cardiology and director of the Ciccarone Center, says the findings will be reassuring to many patients. "Statins can be lifesaving medications for high-risk individuals," says Blumenthal, "but many of our patients became concerned about taking the drugs after the FDA created labeling changes last year. This very robust analysis of the best data available should allay those concerns."