How Third-Party Registration can Solidify your Product Protection and Shopify Warranty Strategy
The explosion in ecommerce growth that occurred during the pandemic may be slowing down somewhat, but shopper expectations for their online experience are higher than ever. Many customers are increasingly gravitating toward brands with warranty registration to protect their purchases.
According to Allied Market Research, the extended warranty market is projected to reach a value of $170 billion by 2027, while the total warranty market will be much higher.
The demand for a reliable product protection plan from buyers and the expense of providing one means that retailers are paying more attention to their warranty workflows and, in some cases, using them to gain a competitive advantage.
We know that nearly 50% of consumers are more likely to choose brands that offer protection plans. It’s also clear that prioritizing customer satisfaction keeps customers happy and can increase Customer Lifetime Value (CLV). A pleasant and reassuring post-purchase experience can drive repeat sales, converting new shoppers into devoted customers.
As an ecommerce retailer, you can either embrace the tools necessary to automate warranty workflows or be left behind as your competitors take advantage of the opportunity. One way to lead the way among Shopify brands is to be sure your product protection procedures aren’t leaving your other sales channels out of the loop.
What are the Differences Between a Shopify Warranty Registration & a Third-Party Warranty Registration?
If your company sells on Shopify, you may already offer a product protection program. Our research shows that more than 30,000 Shopify retailers offer a warranty program to buyers. And a retailer’s warranty return policy substantially impacts your customers and profits even if you don’t realize it. Customer behavior backs up their previously-mentioned preference for a product protection plan. Our data shows that as many as two-thirds of shoppers will visit a site’s warranty returns page before they make a purchase.
It’s really pretty simple. Implementing a customer-friendly warranty returns program demonstrates your commitment to satisfaction and confidence in your products. That’s powerful because customers want to have similar confidence in their purchase.
But what if Shopify isn’t the only site where your sales originate? Many ecommerce companies rely on omnichannel marketing across multiple marketplaces. Among ReturnLogic retailers, approximately 25% of warranty claims are made by shoppers who purchased from a third-party marketplace, so it’s not a segment of your customers you should overlook. Reassuring those buyers that they’ll have support if a product doesn’t meet expectations also matters.
From a customer’s perspective, there may be little difference between a Shopify warranty registration and a third-party warranty registration. The policy, term and return options may be identical.
But ecommerce companies know that there is at least one major distinction: When an item is purchased through your ecommerce store, a Shopify warranty can take effect immediately after purchase because all of the data you need to manage a future claim is available from the sale.
With a third-party purchase, retailers are often in the dark about the buyer, what was purchased and when the sale took place. Before brands can honor a third-party warranty, they need a way to collect this crucial information.
Product Protection Registrations Keep Retailers Informed About Third-Party Purchases
Product protection registration, often used interchangeably with the terms third-party registration or third-party warranties, is the solution.
With product registration, when someone purchases a product outside of your Shopify store and wants to get a replacement or repair under the warranty policy, they must first visit your website and enter details about the transaction and item to register that product.
Using this approach to third-party registration allows customers to provide data about their purchase, including crucial contact information for the owner, proof of purchase and SKU or serial numbers.
However, the benefits of third-party product registration go well beyond giving your customers access to a product protection plan and warranty coverage.
How Third-Party Registration Helps Your Business Grow
Rolling out a third-party warranty plan via product registration can support various business goals. First, of course, it begins with providing buyers with a top-notch experience and building brand loyalty.
The customer experience is everything in ecommerce. A simple, self-service warranty registration portal reduces friction for shoppers and creates less work for your customer service team. A warranty claim means one of your customers is dealing with a dysfunctional product. They don’t want to be further alienated with frustrating hurdles on their way to a resolution.
Put the Power in the Hands of the Customer
Universally, online shoppers prefer a fast and convenient fix for their problems. Part of the appeal of third-party registration functionality is that it puts the power back in the customer’s hands, allowing them to start a warranty claim whenever and wherever they want. In many cases, they won’t even have direct contact with your team.
This sort of effective returns management can save a lot of time. Compare it to a manual process that collects all the necessary information with a separate third-party system that requires excessive emails, an internal back-and-forth and still costs tens of thousands of dollars. Opting for advanced warranty return management solutions eliminates these time-consuming tasks and the expensive investments that come with them.
Address Returns Fraud
Of course, fraud is a valid concern when dealing with third-party warranty registration. Ensuring that a request is legitimate demands a minimal amount of vetting. Otherwise, the item in question could be a competitor’s product, a stolen product, or nothing at all.
Fortunately, a third-party warranty portal allows you, as the merchant, to require proof of purchase. Users can be asked to upload a picture of the receipt or other documentation that quickly establishes the claim as valid. As a result, you’ll no longer be stuck in the costly and time-consuming situation of trying to balance speedy warranty processing and protecting your company with due diligence.
Develop Repeat Shoppers to Drive up Customer Lifetime Value
Product protection registration can also be lucrative for retailers by opening up a new cache of valuable customer data. For example, contact information and data on what customers bought and when they purchased those products can create a list of willing recipients for product updates and promotional efforts.
Used strategically, you can develop a relationship with customers who may not have shopped at your Shopify store but are familiar with your products. The result, ideally, is an ability to develop repeat shoppers to drive up CLV.
It’s also important to note that although these benefits will interest almost every online retailer, a one-size-fits-all approach doesn’t work in return management. That’s why we established warranty claims as an independent but parallel process in the ReturnLogic software. That way, you can either follow the same workflow or an entirely different workflow for returns, creating the best path for your situation.
How Can You Make Shopify Warranties & Third-Party Warranties Work Together?
While adding a third-party warranty system to your returns management plan will create benefits, the true value comes from syncing the third-party warranty data with your Shopify warranty data through automation.
By consolidating warranty registration data from the two and analyzing dispositions to identify the underlying reasons for claims, your company can make better-informed decisions and mitigate future warranty requests. Comprehensive disposition data will highlight weaknesses in your manufacturing, shipping and packing services or supplier relationships.
Correcting these types of flaws in your supply chain is much easier when your warranty registration data isn’t limited to just the customers using your direct-to-consumer website. Automation also makes it more accurate.
Why It’s Important to Automate Your Warranty Data Collection
Attempts to manually compile data from multiple sales channels often lead to outdated or corrupted information. Pulling warranty registration information from multiple systems into a single spreadsheet or database is time-consuming and susceptible to errors. More importantly, without the proper analysis and optimization, you’ll be unlikely to find actionable insights regardless of where the product protection data is stored.
Instead, an automated warranty returns process can reveal the bigger picture and empowers you to spend less looking for the origins of a deficiency and devote more resources to correcting the problem and avoiding similar ones in the future.
As you utilize warranty registration data to improve your quality control, you can also develop benchmarks designed to evaluate your progress. When the warranty registration data from your Shopify store and third-party warranties work together, you’ll have a clear understanding of your product failure rates and be able to set targets that will keep your business growing. Additionally, real-time intelligence keeps you on track to meet those goals and troubleshoot problems that arise along the way.
Elevate Your Third-Party Warranty Capabilities with ReturnLogic
Success in the ecommerce industry is highly competitive, and increases in labor and materials are reducing margins further. A solid product protection plan and process for handling RMAs and third-party warranty claims can help retailers protect their profits, allocate resources, and optimize their reverse supply chain.
ReturnLogic can provide companies with a data-driven advantage that supports growth and maximizes the bottom line. Despite all the uncertainty retailers face, we know one thing for sure. It costs much more to gain a new customer than it does to keep a current one.
Our Returns Specialists are ready to create an automated warranty request system that keeps your customers happy and builds loyalty. Schedule a demo today to learn more about the tools we offer to help your business grow.