When Old Tricks Become New Treats
The perfect example of this? Layaway. Layaway is a method by which retailers allow consumers to make a purchase over time with the exchange of the merchandise coming at the conclusion of the payment period. This was designed by marketers as a way to sell more product. Consumers were having a hard time affording the items that retailers were selling, so retailers simply changed the way purchases were made. The advent of layaway was a coup for retailers following the Great Depression.
Eventually, layaway gave way to a more advanced form of consumer-based flexibility: the store credit card. Retailers found that, by offering consumers instant gratification by allowing them to take possession of the item upfront, they could charge them interest on the back end. In addition, this new-fangled way to provide the consumer with product also made layaway a taboo topic. Layaway was viewed as lame, and store credit was the chic way to buy things that might have previously been viewed as unattainable. This not only helped sell more merchandise, but it also gave the retailer an alternate income stream based on the interest collected.
All of this continued to work brilliantly until the "punch in the teeth" that was 2008. Consumers' credit worthiness tanked, and retailers' sales hit the skids. The old standby, store credit, was no longer an option. So what did some retailers do? They re-familiarized themselves with layaway. That's right. Layaway is back. When marketers were faced with the age-old question, "how can we get more people to buy more stuff?," they chose layaway. The interesting thing is that many people that fall into Gen Y aren't familiar with layaway's choppy history. This means that the previous reputation of layaway isn't a barrier to its rebirth. In fact, the old technique is so popular again that a new crop of online sites allows consumers to purchase goods from multiple retailers using online layaway. It's quite simple: you make payment to the website for a small fee, and your stuff arrives when your balance is paid in full. It is the perfect solution to what ails the American consumer (for the time being).
What ways are you coming up with to help your company sell more stuff to more people? Have you harkened back to yesteryear to find a source of motivation? Some retailers have as they make a final push to sell more stuff to more people this holiday season. Old tricks are new treats to newer generations. And, believe it or not, layaway may help retailers get into the black as this year comes to an end.