Wal-Mart escalates cell phone war with smartphone trade-in program

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Upgrading your phone? Get ready for some extra walking around money, courtesy of a huge new trade-in program being launched by America’s largest retailer.

Wal-Mart is launching a trade-in program that will give consumers immediate credit toward the purchase of a new smart phone when they turn over their old one at more than 3,600 participating Wal-Mart and Sam’s Club locations. More than 100 phones are included in the program, including a tidy $175 for a Samsung Galaxy SIII, provided it’s in working, non-damaged condition.

The programs make sense. Merchants have only limited power over the prices they can set for new handsets: Since they are already so heavily subsidized by the service providers, there’s often not much room available for additional discounting. Could trade-in prices soon become a new tool in the ongoing smartphone price war? Given that the hardware is essentially the same from one shop to the next, it’s becoming increasingly imperative for merchants to come up with unique incentives to drive not just what you buy, but where you buy it.

In line with other companies that have trade-in operations, Wal-Mart’s trade-in prices can be immediately applied to the purchase of any new phone with a two-year contract. As well, Wal-Mart and its recycling/upcycling partner, CExchange, have stated that their policy is that phones which are traded in will never be sent to landfills either domestically or abroad.

Trade-ins are just one aspect of retailers’ strategies to jumpstart smart phone sales. Another angle that’s increasing in popularity: Offer an exclusive product that no one else has. Best Buy is experimenting with this concept by selling a new Qualcomm Snapdragon-powered HTC One in “vivid blue,” a custom color which will be available only through Best Buy for the remainder of the year. Under the hood, the handset is otherwise identical to existing renditions of the HTC One, but if you’re itching for a phone in this specific color, you’ll have to get it from Best Buy.

Is a special color alone enough to entice you to make a purchase from a specific store? Perhaps more is on the horizon. It’s conceivable that, if retailers’ power continues to grow, we could see exclusive model handsets with different technical capabilities, such as additional storage capacity, bigger batteries, or unique pre-installed apps.

What would it take to sway you?

This story, "Wal-Mart escalates cell phone war with smartphone trade-in program" was originally published by BrandPost.