Walmart Keeps Layaway Minimum At $10

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Walmart (NYSE: WMT) started its layaway programs well in advance of the holiday season. Count backward from December 25 to its September 2 inception, and the period becomes a large fraction of the year. One of the hallmark’s of this year’s program is that the minimum needed to start a program is again only $10. The retailer stressed this particularly when it announced details.

There is no opening fee for customers to start a layaway account and they only need to put down 10% (or $10, whichever is greater). Walmart has kept its minimum threshold again this year. Customers can put items as low as $10 on layaway with a $50 minimum basket. Customers have until Dec. 12 to pay off their account.

Walmart almost always knows more about the bricks and mortar part of retailer world than anyone else, based on its shear size. If the company believed it could increase the $10 minimum to cut risks on a $50 layaway program, it would. Data must show not enough customers are flush enough to be able to do that, without losing part of its holiday buyer base.

And holding that base is important, and profitable.

According to MarketWatch,

While some people wait for Black Friday deals to start their holiday shopping, many customers started using layaway programs weeks ago. Those shoppers, experts say, have likely been to the store more than once to make payments since, creating a valuable form of customer loyalty.

Seventeen percent of shoppers will take advantage of a layaway program this holiday season, according to Deloitte. These programs, in which shoppers reserve products they receive after paying for them over time, give retailers with a way to reach lower-middle and low-income consumers, said Marshal Cohen, chief industry analyst at The NPD Group. And creating a customer that has to keep coming back throughout the holiday season is a benefit of these programs.

“Every time you come in to pay, [retailers] have the opportunity to talk to you, market to you, upsell you,” Cohen said. “It’s the opportunity to create the ultimate loyal consumer.”

Perhaps better, for customer loyalty success than Amazon (NASDAQ: AMZN) Prime.

By almost every measure, Walmart shoppers, on average, have lower incomes than other retailers. Lawaway become a necessity to hold customers, and is also the ultimate way to get the next sales