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How to Help Customers Understand the Value of Warranty

When a customer purchases a product, they want to be sure that they are choosing the right brand: one that makes quality products and is willing to ensure that they last. 

Customers want to know before they checkout that if anything goes wrong, they can turn to the brand for support. Unfortunately, many customers don’t understand what their product warranty offering entails. Brands often don't know where the knowledge gap is with customers and how to communicate value.

Warranties: There's a Knowledge Gap

There's a key reason for this. Warranties across all industries have long been associated with confusing terms and difficult information. A study by Pegasystems in the automotive industry stated that 7% of customers said they don’t understand the manufacturer’s warranty, and another 48% said they only somewhat understand.

This figure is similar to that in many other retail industries.
And it creates an expectation from customers that warranties are complicated and not meant to be understood. 

But when customers do have to file a claim, the experience can reinforce that expectation, or show them how much value the warranty offers. Our ecommerce consumer research found that 81% of customers say they have a positive perception of a brand after a good warranty experience.

Why Warranties Are Valuable to Customers

Warranties provide definite value to consumers. You can help your customers take advantage of this offering by helping them understand what that value is, and how to get it, before they make the purchase.

A warranty is a promise to your customers that you want a long-term relationship with them. It is an assurance that you stand behind your product quality and want the product to be used for a long time.

How Old Warranty Programs Confused Customers

Transparency is key to customer trust. With outdated warranty programs, the full terms, details, conditions, and requirements of the warranty meant that the process was unnecessarily muddled.

Customers with past warranty experiences are likely to report confusion over a few things.

  • Complicated Terms: 

If the warranty terms and conditions are stuffed with a bunch of technical terms and legal terminology, customers leave with more questions. This is especially for those who are not familiar with the language around the product.

  • Poor Customer Service: 

Having a bad customer service response can make your customers even more confused about what they have read in your terms and conditions. This is especially when you don't have multiple support channels and patient agents. 

  • Long Wait Times: 

The process of filing a warranty claim and sending the product back to your company should be short and straightforward, or your customers will end up confused again. This also goes for the wait times for decisions. 

  • Claim Rejections: 

Old providers usually have a long list of reasons why a customer’s warranty claim can be rejected, many of which are vague and confusing. So, most customers are unsure of whether they should get the product or not.

The Value of Modern Extended Warranties

An updated extended warranty from a provider allows your customers to prolong the term of the limited warranty, as well as to add additional coverage such as for wear and tear. Unlimited Mulberry protection is backed by a third-party warranty provider who handles every step of the process, providing an easy and positive customer experience along the way.

Here are some of the benefits customers get through an extended warranty program:

  • Peace of Mind: 

With an extended warranty, your customers will get peace of mind for the unexpected things that might happen. They get assurance that they will get lasting value from the product.

  • Protection for Out-Of-Control Situations: 

Life gets messy, and consumers want to be prepared for anything. Our study found that 91% of customers with kids, and 84% of customers with both kids and pets, are more likely to buy extended warranty coverage. Your customers get support for damages they can't anticipate.

  • Longer Protection: 

Modern extended warranties are usually way longer than the limited warranty term. So, customers can enjoy the protection for a longer time. 

  • Saves Money: 

Modern warranties are offered at a small fraction of the product replacement cost. This can be a big money saver for customers who would otherwise be stuck repairing or replacing the product on their own dime if it fails or is damaged.

  • Quick and Easy: 

Your customers can file a claim easily through a convenient online system. They can get responses quickly and know the status of their claim at any time. Without a lengthy return process, they won't have to be without a functioning product for long. 

How to Communicate Warranty Value to Customers

To create a better customer experience, you need to be aware of your customer journey. Statistics have shown that 77% of customers say inefficient customer service detracts from their quality of life.

There are different ways to show the value of your extended warranties to customers and enhance their experience with your company. 

  • Use Customer-Friendly Language 

Information about your warranty should include clear terms and customer-friendly language, with no bulky sentences, difficult words, and technical terminologies.

  • Have a Dedicated Partner 

Many companies that have in-house warranty programs find themselves overloaded as the company grows. You can solve this problem by hiring a dedicated partner to deal with all warranty claims. They have the experience and bandwidth to provide the 24/7 care and immediate responses that your customers value.

  • Offer Term-Length Options

Your customers see value in their warranty options when they are able to select the plans that are the best fit for their needs. Offering term-lengths that fit your product, such as 1-year, 5-year, or 10-year plans, give customers choices to meet their budget and plans for the product.

Offer Greater Value with Extended Warranties 

Millions of retailers choose to offer warranties because of the benefits they offer customers. You can help your customers understand the value of your warranty offerings by improving a few communication points.

Communicating customer value of warranties shows customers that you care about the value that they get out of your product, and that builds loyalty. When your customers benefit, so you do: satisfied consumers make for a higher customer retention rate.


Is your business looking to offer product protection? Partner with Mulberry


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Janessa McQuivey

About the author

Janessa McQuivey is the Content Marketing Manager at Mulberry. Her degree in Human Development fueled a love of understanding customer experience. She has been in research and writing for 3 years and has covered everything from AI technology to her own dating life. Janessa has published across blogs, newspapers, and academic journals.

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