• by Sarah Mahoney , August 20, 2012

Walmart is already rattling its battle jingle-bells -- announcing that it will offer holiday layaway one month earlier, and extend the program to include more product categories. The preemptive move comes at a time when retailers are trying to assess just how wary consumers will be as they tiptoe into the fourth quarter. 

"The earlier that Walmart is able to get shoppers to commit to layaway purchases, the greater the likelihood those shoppers will be 'locked in' to shopping at Walmart for their holiday needs," Jim Hertel, managing partner at Willard Bishop, a retail consultancy, tells Marketing Daily in an email. "They’ll be coming back regularly to make layaway payments,and that helps create more transactions for the retailer. Plus, for many cash-strapped shoppers it will mean they are 'out of the market' for spending elsewhere and other retailers' sale promotions will be less effective."

The Bentonville, Ark.-based chain says this year, customers can start using Christmas layaway Sept. 16 through Dec. 14. And in addition to adding such new product categories as small home appliances and sporting goods, like trampolines and large exercise equipment, there’s also a social component: Shoppers willing to "like" their local Walmart on Facebook can begin using layaway two days earlier.

The company also adjusted fees. It will charge $15 for its layaway open fee, and then refund that on a Walmart gift card when customers make their final payment. Shoppers need to put down at least 10% or $10, and each item must cost at least $15, with a total layaway purchase of $50.

Layaway is expected to be important for other retailers this year as well, especially since many people are still struggling with family finances. Sears, for example, which resurrected its layaway policy in 2008, offers it 12 months a year.

"We see value in it all year long," Shannelle Armstrong-Fowler, a spokesperson for the Hoffman Estates, Ill.-based retailer, tells Marketing Daily. "We definitely see a cross-pollination between our customers with credit cards and those who use layaway. It’s not that these shoppers don’t have credit. This is just a different tool, and one some customers are very accustomed to using." And Kmart, she says, has always had layaway. “It’s just part of what the brand is,” she says.

She says the Sears layaway plan -- which has a $5 fee, no price restrictions, and guarantees to protect shoppers if layaway items are marked down -- has been especially appealing to robust online shoppers, particularly young adults as well as those who are shopping for “the whole house, not just one occasion.”

She says that while no major changes are planned, either in its terms or how it will be promoted, the company will have an announcement about some innovations in October. 

Similarly, a spokesperson for Toys R Us says it is continuing its 90-day layaway plan, with a $5 service fee. While the company re-introduced layaway for big-ticket toys back in 2009, last year it extended the option to all its merchandise, all year long.