Top 5 Warranty Mistakes Brands Make
Russell Steed
August 21, 2024
Top 5 Warranty Mistakes Brands Make
In this article
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Warranties, often seen as the problem child in e-commerce, play a crucial role in building trust and confidence between brands and their customers. With this, a well-structured warranty program not only enhances customer satisfaction and drives repeat business, but it also a great competitive advantage. However, many brands make the same mistakes in managing their warranty programs, leading to inefficiencies, unhappy customers, and financial losses. In this article, we’ll break down the top five warranty mistakes brands make and the simple solutions to set your brand ahead.
Mistake 1: Using an Overly Complex Spreadsheet
Overview
Most brands use some type of form submission tool and a spreadsheet to submit and track their warranty claims. This is mostly because each brand’s warranty is unique and their processes are so custom that anything else doesn’t work (until now…. [spoiler incoming]). However, managing warranties through spreadsheets is incredibly cumbersome and error-prone.
Why It’s a Mistake
Spreadsheets are prone to errors, lack automation, and are difficult to scale. As the volume of orders and warranty claims grows, the manual effort required to track and manage these claims becomes unsustainable. Not to mention, spreadsheets do not provide real-time visibility or insights into the status of claims, leading to delays and customer frustration.
Solution
Hello Corso. We may be coming on a little strong, but Corso automates and streamlines the warranty process for both brands and customers. We offer customization to fit unique warranty requirements with custom-fields, and provide real-time tracking and analytics. This reduces manual effort, minimizes errors, and improves overall efficiency, in turn, leading to happier customers, and less strain on your CX team.
Mistake 2: Non-Documented Processes or Policies
Overview
Having clear and documented warranty processes and policies is crucial for ensuring consistency and fairness in handling warranty claims. However, many brands fail to document this adequately and communicate them to their customers.
Why It’s a Mistake
Firstly, without documented processes, employees may handle warranty claims inconsistently, leading to confusion and frustration among customers. Non-documented policies can also result in miscommunication, delays in processing claims, and unwanted disputes with customers.
Solution
With a detailed warranty policy, brands can clearly communicate warranty terms and requirements to customers, ensuring expectations are clear from the outset. This policy should be easily accessible and visible to customers. Many brands add it to the product listing as a tool to help drive buyer decisions. These processes also need to be readily available to the CX team to ensure consistency and fairness across all claims.
Mistake 3: No Visibility into the Financial Impact Their Warranty Program Has
Overview
A common misconception in ecommerce is that warranties are costly for brands, however, that’s not entirely the case. Warranties are an excellent opportunity to increase customer loyalty and lifetime value. The key to fully understanding the financial impact is to have complete visibility into ‘all’ the costs associated with warranty claims.
Why It’s a Mistake
Without visibility into financial impacts, brands cannot accurately assess the cost of their warranty programs. This lack of insight can lead to unchecked warranty costs, reduced profitability, and missed opportunities for cost savings.
Solution
By carefully monitoring metrics such as claim frequency, average claim cost, and overall warranty expenses, brands can gain valuable insights and make data-driven decisions to optimize their warranty offerings alongside product improvements. Corso packages up these metrics on one user-friendly dashboard providing all the data you need, at your fingertips.
Mistake 4: Overly Vague or Legal Wording
Overview
Small print, legal jargon, and page-long warranty policies give everyone a headache, and most importantly your customers. This leads to confusion and frustration for customers to find the information they need to process their warranty claim.
Why It’s a Mistake
Overly vague or complex wording can create barriers for customers trying to understand their warranty coverage which can deter them from making a purchase from the outset. It may also lead to disputes and negative customer experiences if customers feel misled or unsure about their warranty rights, damaging brand trust and reputation.
Solution
Brands need to use clear, concise, and customer-friendly language in their warranty terms and conditions. Providing examples and FAQs can help clarify common questions and ensure that customers fully understand their warranty coverage. Transparency and simplicity can enhance customer trust and satisfaction.
Mistake 5: Not Leveraged in Marketing
Overview
A strong warranty program can be a deal maker in the buyer journey, but many brands fail to highlight their warranties enough in their marketing efforts.
Why It’s a Mistake
Warranties serve as a key selling point by demonstrating a brand’s confidence in their products and a commitment to their customers. An exceptional warranty policy can also position your brand far ahead of the competition. Patagonia is renowned for their generous warranty policy and it has distinguished them as the leader in the outdoor goods industry.
Solution
Brands should feature their warranty offerings in their marketing materials, including websites, product listings, advertisements, and product packaging. Highlighting the benefits of the warranty program can foster customer trust and drive sales.
Warranties In Summary
An exceptional and structured warranty policy can keep customers returning time and time again, great for sales and great for your customers. By moving away from complex spreadsheets, documenting processes, gaining financial visibility, simplifying warranty terms, and leveraging warranties in marketing, brands can easily turn their warranty programs into their competitive advantage, while fostering long-term customer loyalty and brand success.
Take the tour around Corso warranties and learn how we’re changing the warranty game.
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