Bringing Retail to Financial

I’m just brain stormin’ here.

Last week, I saw an ad from Kmart advertising a forgotten concept … layaway!

Immediately, 3 things jumped to mind:
1. “Wow, they really have their finger on the pulse of the economy.”
2. “What in the world is so expensive at Kmart that you’d need layaway?”
3. “How can we bring this idea into the financial world?”

Layaway, a purchasing agreement by which a retailer agrees to hold merchandise secured by a deposit until the product price is paid in full by the customer, is an idea whose time may have returned.

Let’s face it, job loss may be up, foreclosures may be soaring, the stock market is a roller coaster ride with more downhills than up, and a recession may be imminent – if not already here – but we’re still Americans darn it! We still want more than we can afford. We still believe in buy it now and pay for it later.

Layaway is the perfect answer. Heck, you can even use layaway for online purchases now … just check out http://www.elayaway.com/.

OK, so how do we take advantage of this in our institutions?

LAYAWAY CDs

What if we offered a “Layaway CD” with a term of 3, 6 or 9 months (maybe a year if you feel lucky) where the customer can make regular deposits throughout the term but has a penalty for early withdrawal?

The CD is kinda like a layaway with interest. It has an end date goal … the customer can’t touch the money … and a CD offers what no layaway can – a fixed INTEREST RATE!

If a customer wants a big screen TV, for instance, but can’t afford it now and doesn’t want to add to their credit, they simply open a Layway CD and start putting money aside with the understanding that they can take that TV home in a few months.

Maybe this will help spark an idea to help you differentiate your shop and provide a product that your customers don't even know they need yet.

Take care,
Eric