Often classed as the elephant in the ecommerce room, warranties can be taboo for brands. However, done well, they play a crucial role in shaping customer experiences and influencing purchasing decisions. As online shopping continues to grow, understanding the nuances of ecommerce warranties is essential for both consumers and brands. In this article, we deep dive into the good, the bad, and the ugly sides of ecommerce warranties.

One of consumers’ biggest concerns when purchasing, in particular, higher ticket products, is “how long will it last and what if it stops working?”. An excellent warranty policy demonstrates a brand’s commitment to standing behind their products with promising quality and durability. This not only instills confidence in customers, but also increases conversion rates and brand loyalty.

Effective warranty programs demonstrate a brand’s commitment to customer satisfaction, fostering loyalty and encouraging word-of-mouth recommendations. In fact, 81% of customers are more likely to make repeat purchases from a brand if they’ve had positive experiences with warranty claims. By transforming a potentially negative and frustrating situation into a positive experience, brands can increase brand loyalty and customer lifetime value.

In an increasingly busy marketplace, excellent warranty policies can set a brand far ahead of their competitors. For example, Patagonia is well-known for their lifetime warranty policy for their outdoor goods, which not only demonstrates they believe and trust in the quality of their products, but also instills this same confidence in their customers. According to a poll by Slick Deals, 77% of shoppers have bought lifetime warranty products over alternatives and 3 in 5 shoppers are willing to spend twice as much as the ticket price, for a product that lasts a lifetime.

While warranties can drive sales and build loyalty, they also come with at a cost. Managing warranty claims, providing replacements or repairs, and managing customer service tickets can all strain resources. For small and medium-sized ecommerce brands, these costs can be significant and can impact profitability.

Another challenge with ecommerce warranties is the potential for abuse and fraud. Some customers may attempt to exploit warranty programs by making false claims or returning products that were intentionally damaged. This not only increases costs but can also create logistical challenges for brands trying to verify legitimate claims.

Complex warranty processes can be incredibly frustrating for customers and deter them from making future purchases. Lengthy claim procedures, difficult-to-understand terms, and unresponsive customer service can affect trust and harm a brand’s reputation. This highlights the importance for brands to streamline their warranty processes to ensure a positive customer experience.

When warranties fail to meet customer expectations, brand loyalty, and customer lifetime value suffer. Poorly managed warranty claims, denied requests, and inadequate support can lead to negative reviews, social media backlash, and loss of customer trust. These experiences can have lasting negative impacts on a brand’s reputation and sales.

A poorly executed warranty program can overwhelm CX teams, meaning longer response times and underwhelming customer service. Many brands operate their warranty program through a hefty form, multiple spreadsheets, and automations that could topple at any time. This extra CX load can lead to long resolution times and customers feeling inadequately supported or falling through the cracks, further adding to their negative experience.

 

Corso has taken the good, bad, and ugly side of warranties and revolutionized the way they are handled, transforming them into a win-win for both brands and customers. With a flexible, streamlined warranty management system, brands can gather necessary data and pre-qualify claims for fast resolutions. This efficient process, supported by custom fields and data collection, ensures quick and accurate claim handling. Whether it’s offering refunds, partial credits, repair parts, or replacement products, Corso provides flexible resolution options that are just a click away, making it easy to address and resolve customer issues quickly.

One of Corso’s brands had an average ticket handling time for warranty claims from an average of 7 minutes with 4-6 emails. With our warranty management tool, that is now down to zero emails and an average 30-second handle time. Time is money and they are saving a lot of it!!