The industry is not just counting on best-selling toys to generate joy at the cash register. Major retailers are pushing more attractive layaway plans to lure shoppers into stores before they go elsewhere this holiday season.

Competition will be stiff over layaway: who's the earliest, with no fee or just a small fee.

"This year there is going to be more action early, and it's the battle of the layaway programs," said Jim Silver, editor in chief of TimetoPlay.com, which released its "Most Wanted List" of toys on Friday.

"Everybody is being super aggressive, announcing the hot items, saying 'come get it on layaway.'"

Walmart U.S., Wal-Mart's largest unit, brought layaway back a month early this year - giving shoppers who live paycheck-to-paycheck more time to pay for holiday gifts.

Toys R Us Inc offered layaway with no upfront fee, and soon after, Walmart cut its upfront fee to $5 from $15. The $5 fee will be returned in the form of a Walmart gift card if all payments are completed on time - as the $15 fee would have been.

Last year, Wal-Mart Stores Inc used the layaway strategy successfully to boost sales, taking toy shoppers away from the likes of Toys R Us and Target Corp.

Among this year's hot toys is LeapFrog Enterprises Inc's $99.99 LeapPad 2 Explorer tablet, an update on last year's massive holiday hit.

The tablet made Time to Play's Holiday 2012 Most Wanted List, which is a hot read for toy industry executives. It was also featured on The Toy Insider, a holiday gift guide from a publisher that serves the toy and licensing industries, as well as gift lists from Walmart, Toys R Us and Sears Holdings Corp's Kmart.

Time to Play's list includes returning classics like Teenage Mutant Ninja Turtles figures; a princess wedding castle playset for Hasbro Inc's My Little Pony; Lego Friends; and an update of Hasbro's furry 1990s toy, Furby.

Newer characters like Just Play's Doc McStuffins could be a hit. The doll based on the Disney Junior show has landed on lists from Time to Play, Toys R Us and Toy Insider.

Trotting out the same old toys year after year won't work, industry insiders say.

"Parents want to feel like they're making their kids happy, so a lot of it is making sure they have those products that have value and innovation," Hasbro's head of U.S. marketing, Billy Lagor, told Reuters at the Time to Play 2012 Holiday Showcase In New York.

Updated Furby dolls, for example, now can interact with one another.

"If the value's there, they seem to be spending," said Dan Cooney, vice president of sales for Jakks Pacific Inc. "Christmas always comes. There is always going to be the toy gift at Christmas. Parents will sacrifice other things to make sure that their kids have that special gift."

Other items on the list include Thomas & Friends' Steam and Speed remote control by Mattel unit Fisher-Price, and Winx Club Everyday Concert Collections by Jakks Pacific.

The list can be found on the website www.TimetoPlayMag.com.

Hasbro is looking for a better holiday season this year than the one last year, when demand weakened after Thanksgiving.

Larger rival Mattel saw international sales at holiday time hurt by a stronger dollar.

At stores, shoppers will have options other than layaway.

Toys R Us has introduced a program this year that lets shoppers reserve any of 50 toys on its list by making a 20 percent down payment in person at its stores by October 31.

Dollar General Corp said Thursday it is offering a 10 percent discount on purchases of at least $75 from its toy selection, which includes items by Mattel, Hasbro and Walt Disney Co.

(Reporting by Phil Wahba in New York; Editing by Brad Dorfman, Jeffrey Benkoe and Richard Chang)

• A Permanent Economic Emergency