Layaway Isn't Just for the Holidays Anymore: Kmart Exec
Consumers are no longer relying on layaway programs just at the holidays, Kmart Chief Marketing Officer Mark Snyder told CNBC Wednesday.
A recent study by Sears' Kmart showed that 70 percent of consumers have changed their shopping behavior because of the recession, and as such, Kmart's layaway strategy gives shoppers a reason to reconsider visiting its stores, Snyder said.
"The recession has taught [consumers] that they've got a ton of choices," he said. "They recovered their full power as shoppers and they're out there using it.
Snyder said it's important to realize that even though spending has been down, consumers still want to buy new things. As such, layaway has been an "organically acceptable way" to make big purchases without racking up interest payments.
"In February, she's buying outdoor living sets," Snyder said. "It's still snowing outside, but she knows in eight weeks they're going to begin to move outside again, [and] she wants a new patio set."
Though the retailer has offered layaway options for the past 40 years, parent company Sears Holdings saw double-digit growth in the program between 2008 and 2009, after using it as a key marketing strategy for the '08 holiday season, Snyder said.
What's more, Sears has formed more than 3 million customer relationships through the program.
"What's really going to be interesting about this recession...is that behaviors truly have changed," Snyder said. "The post-recession customer is not going to forget about what they've learned."
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