Press Office

Auckland, 13 December 2007 - Kiwis are embracing online shopping this festive season, with research from MasterCard Worldwide revealing consumers are spending more time and money than before doing their Christmas shopping online.

MasterCard Worldwide Holiday Shopping Insights Report reveals that Kiwi shoppers plan on doing nearly a third (32 per cent) of their Christmas shopping online and that three in five intend to use the Internet to make purchases – compared to two in five last year.

Stuart McKinlay, country manager, New Zealand, MasterCard Worldwide, said the MasterCard Worldwide Holiday Shopping Insights Report revealed Kiwis’ shopping trends and behaviours are changing, with an increasing number of consumers making their purchases using the convenience of plastic.

“The increased pace of life, confidence in online shopping and ease of payment has lead to the popularity of buying Christmas gifts online. Consumers are becoming savvier as they recognise the benefits of shopping online with payment cards,” said McKinlay.

Clothing and accessories, food and liquor, and toys, games and sporting goods top the list of planned in-store purchases while books, CDs and DVDs have emerged top on the list of online spending.

“While the report shows that online shopping is the perfect option for busy Kiwis in the lead-up to Christmas, it also shows that Kiwis are realising the benefits and advantages of paying by payment card.

“Payment cards provide the convenience of buying goods and services online, unlike other forms of payment, and also provide cardholders with added security when making purchases,” McKinlay added.

Of those who shopped online last year, a quarter are looking to spend more online this Christmas and of those who did not use the Internet for their purchases, two in five intend to do so this year. In addition, many intend to shop online as much or more this season.

“Christmas is a special time for Kiwis – whether it involves spending time with family and friends at home, at the bach or on the beach.

"While spending looks strong this year, it is also encouraging to see that the majority of Kiwis (61 per cent) will be setting a budget. We know from previous research that more than 90 per cent of respondents plan on paying off their purchases within three months.”

McKinlay said that although signs are there that spending remains strong, the report reveals that Kiwis have a tendency of not sticking to budgets with a majority of respondents (86 per cent) showing a tendency to go over budget at Christmas time. Only 13 per cent said they never spend more than they have budgeted for.

While Kiwis will be spending up big, the dent to their bank balance will be smaller than those across the Tasman, with the average Australian set to spend AUD$782 on Christmas gifts. 34 per cent of the Australian consumers' spending is expected to be conducted online.

The report found that most Kiwis are not very keen on leaving gift-buying until the last minute, with 62 per cent looking to complete their shopping by mid December. A third (33 per cent) saw Christmas Eve as the busiest shopping day and 32 per cent felt the Saturday prior to Christmas is going to be the busiest period.

The nationwide survey of 500 people aged 18 and over was conducted in September through October 2007. It was undertaken to determine spending trends across a range of product categories and to examine consumers’ spending habits.

Among other key findings are:

• Kiwis plan to spend a third or more of their Christmas shopping budgets on clothing or accessories (34 per cent), books, CDs, DVDs (34 per cent), toys/ games/ sporting goods (33 per cent)
• While most shoppers plan to have their gift-buying complete by mid December, 23 per cent expect to have all completed to the week before Christmas and just nine per cent will leave it until the day before
• While a MasterCard Debit card has not yet been launched in New Zealand, there is a strong understanding of the benefits of the product, with seven in ten agreeing such a card would help them stay on budget with Christmas shopping.

As always, MasterCard encourages consumers to spend responsibly. Last year it launched the MasterCard Budget Basics initiative, a free, easy-to-understand debt management tool designed to help Kiwis successfully manage their budgets and reduce debt. For additional information visit www.budgetbasics.co.nz

Top three tips to manage your budget this Christmas

• Draw up a budget for your Christmas expenditure so you can estimate how much you need to spend over the Christmas period. Visit the MasterCard Budget Basics website for budget advice and an online calculator, http://www.mastercard.com/nz/budgetbasics/index.html.
• Keep track of your spending by regularly referring to your credit card transaction reports.
• Log on to your internet banking account to check your statements online in between monthly statements.

MasterCard Worldwide advances global commerce by providing a critical economic link among financial institutions, businesses, cardholders and merchants worldwide. As a franchisor, processor and advisor, MasterCard develops and markets payment solutions, processes over 16 billion transactions each year, and provides industry-leading analysis and consulting services to financial institution customers and merchants. Through its family of brands, including MasterCard®, Maestro® and Cirrus®, MasterCard serves consumers and businesses in more than 210 countries and territories. For more information go to http://www.mastercard.com.

The MasterCard Worldwide Holiday Shopping Insights Report was commissioned by MasterCard Worldwide and was conducted online by Ipsos-Insight Corporation, an independent research company. Interviews were conducted in late September and early October 2007. Although the findings cited here are representative of the responses from U.S. consumers, more than 4,500 interviews were conducted in five countries, in addition to the United States: Canada, Australia, New Zealand, Singapore and Mexico. An online methodology was used in all countries except for Mexico, where a telephone methodology was used. Results from the 2007 survey were compared to 2006 results in the U.S. Data was weighted by age and gender to be nationally representative. Subgroups were stat-tested against each other at the 90 percent confidence interval. In addition, MasterCard based other findings cited in this release on information from billions of payment card transactions over the past several years.

Statements in this press release which are not historical facts, including any statements about MasterCard's plans, strategies, beliefs and expectations, are forward-looking and subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements speak only as of the date they are made. Accordingly, except for the company's ongoing obligations under the U.S. federal securities laws, the company does not intend to update or otherwise revise the forward-looking information to reflect actual results of operations, changes in financial condition, changes in estimates, expectations or assumptions, changes in general economic or industry conditions or other circumstances arising and/or existing since the preparation of this press release or to reflect the occurrence of any unanticipated events. Actual results may differ materially from such forward-looking statements for a number of reasons, including those set forth in the company's filings with the Securities and Exchange Commission (SEC), including the company's Annual Report on Form 10-K for the year ended December 31, 2006 and Current Reports on Form 8-K that it has filed with the SEC during 2007, as well as reasons including difficulties, delays or the inability of the company to achieve its strategic initiatives. Factors other than those listed above could also cause the company's results to differ materially from expected results.