This story has been updated from 12:01 am EST to include additional information in the last two paragraphs.
NEW YORK (TheStreet) - Wal-Mart (WMT) is launching a video game trade-in program that it hopes will "disrupt" the $2-billion pre-owned video game market and take share from competitors like GameStop (GME).
Starting March 26, approximately 3,100 U.S. Walmart stores will begin buying back used video games, the company announced in a conference call with reporters. The new program will add to Walmart's mobile device trade-in program, which was launched last year.
Customers who bring in older version games, specifically from Microsoft (MSFT) Xbox 360, Nintendo Wii and Sony (SNE) PlayStation 3, will receive Walmart credit that then can be used on most store merchandise from groceries to socks to bikes, the company says.
Trade-in values will vary, from just a few dollars to as much as $35 per game, Walmart says. Customers can use the credit at Walmart and Sam's Club, both in stores and online.
The traded-in games will be sent to be refurbished and made available for purchase in like-new condition both online and in stores. The video games will be labeled "Certified Pre-Owned," which means the product is fully refurbished and in like-new condition, Walmart says.
"We're going to shake up the market place," said Duncan Mac Naughton, chief merchandising and marketing officer for Walmart U.S., in a conference call with reporters on Monday.
"This is a new category for us and something our customers have been asking for," Mac Naughton stated. "Gaming continues to be an important business for us."
He expects the first crop of used games to be available for sale this summer.
Approximately 8 in 10 games sitting in households are not currently used, presenting a big opportunity for Walmart to gain share in the pre-owned video game market, the company said. Walmart is hoping that the addition of pre-owned games merchandise will be an entryway for newer gamers to purchase at Walmart as well as a way for early-adopter gamers to get into the latest version of game consoles quicker.
The newest gaming consoles, Xbox 1 and PlayStation 4, were both launched in November, in time for the holiday season.
Video games must be working and accompanied with original packaging. Walmart electronics department associates will scan the UPC code on the case and evaluate the game for obvious damage such as deep scratches or cracks. The customer is then provided with a trade-in value for each game to accept, the company says.
When asked if Walmart considered a cash option, Mac Naughton said the store credit was "just like cash" as consumers can "go from buying an apple to buying a bike to virtually anything in the store. That's what we thought was best for the customer."Walmart is working with CE Exchange to implement the video game program. CE Exchange also works with Walmart for its smartphone and tablet trade-in program.
--Written by Laurie Kulikowski in New York.