Dealerscope Warranty Roundup: 2017 Goals & Strategies

By: Jeff Hatch

March 14, 2017

Sean Stapleton, president & CEO of Warrantech, recently spoke with Dealerscope magazine as part of a discussion on upcoming company initiatives. The following is an excerpt, providing a brief glimpse of what Warrantech has in store for 2017 to help businesses increase their extended service plan offerings and give customers the most value for their money and a worry-free shopping experience. 
 
Warrantech has developed a revolutionary new customer loyalty program for its partners that is designed to generate both recurring protection plan revenue and long-term customer retention.
 
The program allows retail partners to offer their customer base customized protection bundles for major appliances, mobile devices and connected living products owned by the customer, regardless of where the product was purchased. Partners have the ability to offer their customers monthly product protection subscriptions designed to enhance the customer’s experience with a full menu of features including 24/7 tech support and seamless repair/replacement solutions.
 
The program can be customized to provide disappearing deductibles for services or products provided to customers under the plans procured through the participating partners, thereby incentivizing customers to remain loyal to the partner retailer. Moreover, the rich data from the program can be monetized to help deliver targeted and personalized product offerings to customers based on their recent program usage.
 
Look for the full article in the March 2017 issue of Dealerscope or online at http://bit.ly/2mKB0iJ   
 
And be sure to keep up with us on Facebook, Twitter and LinkedIn so you can learn more about our innovative products and services as they become available.

Filed Under: Dealerscope, initiatives, offering, products, program, Sean, service, Stapleton

WCM Conference Keynotes

By: Jeff Hatch

March 09, 2015

Sean Stapleton, president and CEO of Warrantech/AMT Warranty will be presenting at the 2015 Warranty Chain Management Conference on March 11 in Miami. The following is an excerpt from Warranty Week in anticipation of the event. 

The technology is changing. The need for repairs is changing. Even the concept of ownership is changing. And the way people shop is changing. Two industry experts describe how they see these changes impacting warranty and service contracts.

At this year's Warranty Chain Management Conference, attendees are immediately going to be challenged to face the changes that new technology is forcing upon our industry.

It's going to be a bit upsetting, especially to those who like the status quo. Rather than hearing about the latest best practices in the break/fix business, and how everything is slowly going to get incrementally better, attendees are going to be told how driverless vehicles will challenge the whole idea of automobile ownership, and how comparison shopping apps that seek out the lowest prices have made it tough to earn a living in retail.

A pair of warranty industry experts will deliver a one-two punch of keynote presentations at the WCM Conference on March 11 in Miami, about the impact of disruptive technologies upon warranty. We spoke with both of them this week about their presentations.

John Estrada opens the morning session with a talk about how driverless transportation will change warranty and service contracts, followed by AMT Warranty's Sean Stapleton talking about how warranty and service contracts can help save retail from its downward spiral, by making value and customer relationships as important as low prices.

WCM's Morning Schedule

In the WCM program, Stapleton's 45-minute presentation is called "Combating the Retail Pandemic," a title he said he came up with a few months ago when the Ebola scare reached the United States. They're by no means the same thing, but in economic terms, the current state of the retail environment provokes a comparable level of fear for many veteran merchants whose iconic organizations are facing possible extinction.

"I certainly wanted to grab everyone's attention, but more importantly I felt that the title set the stage for a discussion about a very serious and widespread situation for retailers and manufacturers," he said. "A pandemic is a disease that has a disastrous impact felt both locally and globally." And he said that many colleagues and friends in the retail industry are dealing with a profound change in both customers and the marketplace where a low price seems to be the main determining factor for product purchases. So either they lose the sale, or they get the sale but lose money anyway.

In other words, the sales slump that's hurting many of them comes not just in terms of revenue but also in terms of profitability. "Margin erosion has impacted retailers in ways never seen before," he said. Price will always be a factor when a product is purchased, he added. This is nothing new – the modern difference is the ease by which customers can obtain pricing comparisons and make purchases through multiple sources.

The Great Recession

Stapleton said some people blame the current retail challenges on the lingering effects of the Great Recession – the decline of household income, aging baby boomers, rising unemployment, or falling home values. Others say it's the lack of innovation, or the lack of exciting new "must-have" products.

"The reality is that there has been product innovation: smartphones, 4K and Ultra HD, wearables, advanced car tech, and highly functional tablets. You look at the growth the CEA expects for these segments, and it's tremendous. So the innovative products do exist."

Meanwhile, the economy may not be as strong as we would all like, but it's not as bad as some people make it out to be, he said. The U.S. Census Bureau pegs the January-to-January sales gain at 3.3%, which isn't great but also isn't dismal. Total retail sales for the November-to-January holiday period were up 3.8% from the same period a year ago. The U.S. unemployment rate is now down to 5.7% and the median price of existing home sales is up 6.2% since last year. So what is it?

Ironically, he said, in an era where retailers are perhaps more connected with their customers than ever before, thanks to social media and big data, those connections are more superficial than ever.

"The heart of what I'm going to discuss is that many retailers and manufacturers are just not achieving a high level of loyalty and commitment from their customers," he said. "Part of the problem is that we're living in the 'Age of Like.' We see this play out on Facebook every day, with users happily clicking the thumbs up icon for just about anything they see. However, that's where the customer commitment often ends. 'Like' should not be our collective goal. To be successful we need to aspire to win the love of our customers. The reality is that overall we aren't seeing the same level of affinity for brands that we used to enjoy."

For instance, Stapleton said, his father always bought Kenmore appliances. "He loved his Kenmore appliances because, in his mind, they earned his trust and loyalty year after year" he said. "He wouldn't dare shop for another brand. Sadly, we don't have that kind of an environment anymore."

"As warranty and service contract professionals, we have a unique opportunity to affect customer loyalty," he said. "We have the ability to turn a negative experience into a powerful trust building moment with customers. Customers recognize and accept that product breakdowns can happen to even the most reliable products. The customer's perception of the product issues are more often driven by our responses."

Stapleton further noted that one of the greatest challenges with service contract programs arises when a customer's claim isn't covered under the contract, whether as a result of an expired contract or other reasons. "In such situations, there is still an opportunity to turn a negative into a positive."

He suggested that there are plenty of instances when no coverage exists, but accommodation can still be made to assist the customer and provide them value. Accommodations may take the shape of providing a product replacement or repair outside the service contract. However, there are other solutions that are less frequently utilized that can have a major positive effect with minimal financial impact.

For instance, Stapleton noted that broken products not covered under a plan can be purchased back from customers based on the products core value. Additionally, discounts on replacement products can be provided or even gift cards with token values which can be applied to future purchases can be offered to customers. The actual cash value is less important than the act of going the extra mile for a customer.

Discount Repair Services

Stapleton proposed another low-cost marketing idea: leveraging a claims administrator's repair network by making it available to customers who have a non-covered product issue. Why not offer loyal customers discounts on repairs for their customer-pay jobs related to these types of product issues, or even for other products they own?

"Here's how I see it: Warranty and service contract programs are developed by operations groups. However, the marketing departments of the retailers or manufacturers are rarely involved in the development of these programs. And I think that creates a level of disconnect. I see service contracts and warranty programs as one of the most powerful loyalty solutions out there. It actually is a game changer," he said.

Manufacturers and retailers might not know the name and address of every single customer, but they certainly have that data for those who needed warranty work or who made claims under their service contracts. With this information, a critical segment of their customer base can be identified and hopefully saved.

Stapleton suggests that marketing departments utilize claims data to establish a loyalty campaign tailored toward these affected customers. "The fact is that some of these customers may have been your best customers in the past. The data currently residing in a company's system can provide them the ability to know how and when a customer's perception of them soured. Moreover, that data combined with a strong retention plan can help return the customer to their former loyalist status. Further, this type of strategy can prevent the impacted customers from becoming one of your net detractors." He noted that with the power of social media, disenfranchised have the ability to shape an enormous population of existing and potential customers' views of your product or company.

Ultimately, he said, when structured and executed appropriately, warranty programs build trust and loyalty. Stapleton said it is inexcusable to allow one claim to impact a lifetime relationship with an existing customer. "Instead of spending the majority of available marketing resources to bring in new customers, let's keep the ones you have. Let's prevent them from getting out into social media and destroying your reputation based on one poor claim event."

The first step, Stapleton suggests, is to change the whole image of warranty within the retail industry. "If you want to change the perception of warranties and service contracts for customers, you have to change it internally first. We can't allow warranties and service contracts claims to be viewed as an unfortunate expense. We need to view them as a marketing opportunity that can potentially save a customer thereby leading to countless future purchases and maybe even a means to evoke positive customer emotions that go beyond 'like.'"

To read this article in its entirety, go to Warranty Week. And be sure to visit Warranty Conference for more information regarding the WCM Conference.

Filed Under: claims, Conference, customers, economy, retail, Sean, service, Stapleton, Warranty

TWICE Magazine’s Extended Service Report

By: Jeff Hatch

February 17, 2015

Sean Stapleton, president & CEO of Warrantech, recently took part in TWICE magazine’s roundtable discussion on the state of the extended-service contract industry. The following is his response to the challenges and opportunities that lie ahead. 

What is the greatest challenge facing the extended-service contract industry?

A significant challenge faced by our industry continues to be retail margin compression. As a result of the fierce competition between retailers for customers, retailers have few choices but to generate savings in other parts of their businesses. Extended service contract programs are certainly high on the list of many retailers as an opportunity to retain additional revenue. The result is that administrators and their respective underwriters are forced to try to become more efficient or reduce claims funds to compete.

While competition should be seen as a positive force in business, this continued underwriting pressure could lead to administrators underpricing programs to win opportunities. This will likely result in programs being underwater, thereby leading to frantic attempts by the administrators and their underwriters to reduce both administration expenses and claims costs. The likely downstream effect will be negative customer experiences and further diminished customer loyalty.

Conversely, where do the industry’s greatest opportunities lie?

The greatest opportunity for our industry will be the development of protection solutions that allow customers to cover a broad spectrum of devices and equipment utilizing diverse payment mechanisms. Warrantech has developed solutions that better enable customers to purchase protection plan products in a convenient manner, covering more items, and providing additional value that ultimately will result in additional revenue and customer satisfaction for our partners.

What is your biggest takeaway from last month’s International CES?

The consumer appetite for connected products is gaining momentum at an astounding pace. Manufacturers are clearly listening to consumers and are focusing their efforts on smart products, which are able to communicate and synchronize in ways never before imagined.

With this enhanced communication functionality being developed for devices, we believe that consumers will demand a unified platform that can seamlessly monitor, control and report back to the consumer on the status of their connected equipment.

The next logical step will be a protection solution that is able to provide coverage for each connected device. In order to provide a comprehensive single solution, providers of protection plans will need to be able to provide protection for connected products ranging from smart appliances, televisions, mobile devices and even automobiles. 

Please share any new programs or services that would be of interest to our readers.

AmTrust [Warrantech’s parent company] has been an innovator in the telematics space with regard to protection offerings. Last year we launched our Connected Protection solution, which provided vehicle service contract purchasers with the ability to protect mobile devices connected to their vehicle’s WIFI network.

For 2015 we plan to provide our retail partners with the ability to offer monthly protection plans to their customers, which will provide comprehensive protection for an extensive array of equipment owned by the customer. Customers will enjoy additional benefits for products purchased through the retail partner, including disappearing deductibles and in-store service. The goal is to drive both recurring protection plan sales and traffic to the participating retail partner’s stores. The offering, known as our Loyalty by Warranty™ program, will provide retailers with an innovative way to increase revenue as well as customer loyalty.

Visit twice.com to read the extended service roundtable discussion in its entirety and for more industry insight.

And be sure to keep up with Warrantech on Facebook, Twitter and LinkedIn so you can learn more about our innovative products and services as they become available.

Filed Under: CES, contract, customers, extended, industry, Sean, service, Stapleton, TWICE, Warrantech

TWICE Executive Forum Q&A

By: Global Administrator

April 28, 2014

Sean Stapleton, president & CEO of Warrantech, recently took part in an Executive Forum with TWICE magazine. The following is his response to the magazine’s inquiry regarding the criteria for choosing an extended service plan provider.

“What criteria should retailers look for when electing an extended service plan provider for their operation?”

Retailers searching for the right extended service plan (ESP) provider should carefully evaluate the financial stability of any prospective provider. The industry has far too many examples of providers who have shuttered their doors leaving both retailers and the customers holding the tab. Audited financials showing a history of strength and stability should be a precursor to any discussion.

Next, retailers should look to partners who are committed to providing complete program transparency, including claims data down to the product level. Often, providers do not share this data for fear of a retail partner understanding the real economics associated with their program. One of the hidden benefits of this transparency is that retailers gain a better understanding about the performance of the products they sell. This data provides insight to the customer experience (beyond the OEM warranty) and allows retailers to more effectively negotiate with product manufacturers and distributors regarding product prices and discounts.

Most importantly, retailers should choose a provider who understands the importance of providing fanatical customer service and has the tools and resources to provide such levels of service for the long run.

For more information about customer care solutions from Warrantech, be sure to visit http://www.warrantech.com/partners/partner-services/customer-care/

Filed Under: customer, extended, magazine, plan, provider, Sean, service, Stapleton, TWICE

Peace of Mind: the Ultimate Add-On

By: Global Administrator

April 07, 2014

Sean Stapleton, president & CEO of Warrantech, recently spoke with Dealerscope magazine about the importance of extended service plan programs for retailers. The following is an excerpt, providing a brief glimpse of what the company has in store for 2014 to help businesses increase their extended service plan offerings and give customers the most value for their money and a worry-free shopping experience.

Warrantech Corporation works closely with its retail partners, field training teams and consumer focus groups to develop innovative programs designed to drive extended service plan sales. Through this collaborative effort, new program offerings are developed and tested. Once beta testing has been completed, successful programs are rolled out to Warrantech partners.

Based on recent beta-testing results, Warrantech is making available to its partners a number of dynamic offerings designed to increase both partner revenue and customer retention. One such offering is Warrantech’s Verify & Protect program, which is a real-time missed point-of-sale extended service plan program for online retailers. This program utilizes multichannel marketing solutions to offer customers who have not purchased an extended service plan as part of their product purchase an additional opportunity to do so on a real-time basis. Additionally, the program is designed to create a white-glove experience for customers by providing them with real-time purchase detail and shipping confirmations on their recent purchases.

Look for the full article in the March 2014 issue of Dealerscope or online at www.dealerscope.com.

And be sure to keep up with us on Facebook, Twitter and LinkedIn so you can learn more about our innovative products and services as they become available.

Filed Under: &, customers, Dealerscope, extended, plan, Protect, retailers, Sean, service, Stapleton, Verify, Warrantech

Displaying results 1-5 (of 6)
 |<  < 1 2  >  >|