In the competitive ecommerce market, companies are vying for their products to become customers' top choice. Since 98% of customers don’t make a purchase the first time on a site, they have plenty of opportunities to compare their options.
When companies want to increase the number of site visitors that they have making purchases, they rely on CRO strategies. Retailers try to improve conversion through offering competitive differentiators that separate them from their competitors.
How Companies Usually Try to Increase Conversion
One of the most common conversion strategies is promotions. Big discounts attract attention that can help companies to get customers in the door, and limited-time savings help them convert on site.
However, discount promotions have their drawbacks. Reducing the product cost also means a cut to revenue. You want to make sure you don’t need to make cuts in production cost that could compromise quality. In addition, customers are used to seeing shockingly low priced product options that are cheaply made. Retailers and customers might think that discounting their products can make them feel less valuable.
Our survey on consumer buying behavior found that customers’ number one concern is budget. Shoppers want to know that they’re getting real savings. They want options that are low cost. But they don’t want to pay a low cost now that requires them to remake the same purchases year after year.
Advantages of Product Protection for Conversion Optimization
The key is to find promotions that you can offer that match customers’ saving goals that don’t require discounting products. Low-cost product protection can be a solution for retailers who want to increase conversion while offering great value to their customers.
Mobvoi, the billion dollar smart electronics brand famous for the TicWatch, decided to partner with Mulberry to put this to the test. Michael Wang, the senior product manager at Mobvoi, noted that product protection was a major offering that consumers were looking for. “We saw that many prospective customers were choosing to purchase from those other retailers because they got some additional peace of mind in the form of long-term protection plans”.
We’ve seen the same trend in our own warranty research survey, where 32% indicated that they wouldn’t purchase a high-cost product without protection options, and 25% said they would move to a competitor’s site to make the purchase. That makes for a conversion rate killer.
Mobvoi and Mulberry worked together to build a strategy to use product protection as a competitive differentiator to boost their conversion rates.
With the low-cost product protection plans, Mobvoi saw their conversion rates increase by 30%.
Using Product Protection to Increase Conversion Rates
While customers are seeking out protection options, they’re also cautious of expensive plans. Cost can be the biggest deterrent to customers in purchasing plans. Our consumer study found that 43% of customers listed plan price as the biggest reason they didn’t purchase an extended warranty.
In their global expansion, Mobvoi wanted to stay competitive in the market. With customers already looking for and wanting coverage, they wanted to offer great value to their customers. Mulberry conducted research and worked with Mobvoi to develop a promotional offer that would drive awareness. Mobvoi and Mulberry decided to cut out the consumer cost by giving customers one year of product protection for $1.
The strategy was clear: offer comprehensive product coverage that went beyond manufacturer coverage, with a bold promotion of offering the first year of coverage for only $1.
Conversion outcomes with $1 plans
Just as research indicated, consumers had fewer hesitations when making a purchase without coverage. With the low-cost product protection plans, Mobvoi saw product protection increase their conversion rate by 30%. That’s a dramatic increase that confirms the value customers see in warranties. Customers are more confident making purchases when they have protection. The low-cost of the plan made the purchase decision a no-brainer for customers.
Even after the 1-year promotion ended, customers continued to respond to the appeal of the product protection offering. Mobvoi’s conversion rates remained higher than before the launch of product protection when coverage returned to normal pricing.
Mobvoi is a big name in their industry, with a strong customer base and established reputation. That makes their conversion rate increase all the more striking, and demonstrates how well consumers respond to product protection at low costs. Mobvoi continues to offer Mulberry accident protection on their TicWatch and other products, and their consumer fanbase continues to grow with their product offerings.
How to Utilize Product Protection
This conversion rate advantage is now easy to get with our newly released MulberryCare. MulberryCare offers the first product protection that is free to you and the consumer. We provide comprehensive coverage for your customers, without costs or operational overhead for you.
MulberryCare is the evolution of the $1 offering that brought retailers such as Mobvoi great success. We want to offer the same conversion benefits, so we’re offering the first 12 months of product coverage totally free.
MulberryCare lets you give your customers free accident protection on any eligible purchases. When customers make a purchase on your site, we’ll automatically register them for 12 months of free protection. The Mulberry team handles all of the claims from end-to-end, which frees you from dealing with manufacturer warranties that require customer service bandwidth.
By giving consumers an option for low-rate product protection, you can pass that value onto your consumers without affecting your bottom line.
MulberryCare Benefits All Retailers
New retailers can access conversion rate increase from marketing the option for a free year of protection without cost to them. Retailers can promote this offering as a differentiator that makes them more competitive.
In addition, retailer partners can drive incremental revenue by allowing customers to purchase upgrades as they check out. This gives retailers a cut of the revenue on each multi-year protection plan.
By giving consumers an option for low-rate product protection, you can pass that value onto your consumers without affecting your bottom line. You give customers the opportunity to save big and get great product value without needing to cheapen your product offerings through product discounts.
To learn more about MulberryCare and how to provide this for your customers, schedule your MulberryCare demo with our team today.