story by Kim Souza
Wal-Mart said this week it will take unwanted iPhone, Galaxy S3 or other electronic gadgets in exchange for gift cards that can be spent in its stores or online. The big box giant joins Amazon, eBay and other retailers wanting consumers’ cast-off electronic gadgets, a mission that analysts said is two fold.
Wal-Mart’s “Gadgets to GIft Cards” program was announced less than a month ahead of the next iPhone release on Sept. 10. The retailer has continued to expand its smart phone offerings and subscription plans at a time when the broader electronic category is struggling.
Perhaps consumers who trade working phones will upgrade to a new phone purchase from Wal-Mart. They might even subscribe to Straight Talk, which is now compatible with iPhones and Android devices.
The company recently posted negative same-stores sales in its entertainment division. Bill Simon, CEO of Walmart U.S., said Thursday (Aug. 15) the sales in the entertainment category posted a mid single-digit negative comp for the quarter ending June 30.
“Our performance was pressured by soft results in both electronics and media and gaming. Mid single-digit industry deflation and softer discretionary spending continued to be significant headwinds for these categories, while the anticipation of new video game consoles caused further delays in spending for gaming,” Simon said.
He said while the retailer lost market share in its TV category during the quarter there was a bright spot in wireless sales. He said Wal-Mart is the number one handset retailer in unit share, according to NPD.
Analyst said the retailer’s move to accept a broad range of electronic gadget trade-ins will also provide the company with a rich data source from consumers who may or may not already be Wal-Mart shoppers. In the process of completing a trade with Wal-Mart, consumers will give the retailer valuable data such as brand allegiance, personal information such as address and even credit history for those consumers who choose the “pay me now” option.
On the surface the Wal-Mart program appears similar to others except that the retailer will grant the seller credit on the honor system, providing the seller can pass a credit check first.
The program accepts a wide range of makes and models of iPhones, smartphones, tablets, MP3 players, game media, laptops, GPS devices and cameras. Popular Apple products are wanted whether they work. For instance, the Apple iPhone 4S in nonworking order will fetch $75. In working order the offer is $205 with AT&T as the provider. However, the price falls to $162.50 if Verizon is the carrier.
Wal-Mart said the worldwide demand for certain carriers has an impact on the price offered.
Lackluster brands of late, like Blackberry, are also approved for trade-in. They fetch anywhere from $3.50 for an old Blackberry Curve to $234 for the newest version Blackberry Q10.
Insiders said Wal-Mart is also offering better deals for some popular devices until Aug. 25, like $175 for a Samsung Galaxy S3 16GB, and $250 for an iPad.
When accessing the exchange site, consumers may get quotes for the devices they wish to trade. If they find a deal they like, Wal-Mart will pay via e-card within minutes. The consumer then has 10 days to send the device to the retailer, who provides a free shipping label in the deal.
The devices are sent to CExchange, a leading provider of electronic trade-in, recycling and asset recovery services who partners with Wal-Mart on this program, said Bao Nguyen, Wal-Mart spokesman.
The deal also hinges on the retailer extending the consumer credit until the device is received. For those who don’t want to share their credit history with retailer, a gift card will be mailed once the device is received and verified. Wal-Mart estimates a three to five-day time period for gift cards to be mailed once the device is received by its program partner.
The Wal-Mart program details can be found its dedicated site.