Merchants Win in Tough Times By Giving Consumers Options
Providing tools to finance a purchase and add a protection plan gives customers the ability and confidence to buy
Many merchants are struggling to keep up with customer demand for everyday items, consumables, and home necessities as people deal with the realities of isolating at home during the coronavirus pandemic. Merchants are limiting the number of items customers can buy in order to serve as many people as possible, and the best merchants are fiercely guarding pricing to protect their customers from abuse. Other merchants are seeing a dip in demand, as customers wrestle with economic uncertainties. At times like this, merchants can give customers additional comfort by offering extended warranties and protection plans on their purchases. Consumers are more risk averse today than they were before, and merchants should do all they can to give them peace of mind when making a purchase.
How to provide flexibility and peace of mind
In today’s environment, merchants and retailers need to be flexible with consumers and give them options. There are multiple ways to do this, but two popular programs in particular stand out as the preferred option that Amazon, BestBuy, Walmart, and others offer to help their customers.
The first value add program merchants can offer is consumer point of sale financing. In today’s uncertain economic environment, cash is king and customers are increasingly mindful of the dollars they are spending. Allowing people to pay over time gives them the flexibility they need to keep cash on hand and increase their buying power. Companies like Affirm, Bread, and Klarna have made this a simple feature that merchants can offer their customers.
The second program popular with top retailers is extended warranties and protection plans. When a consumer buys an extended warranty along with their product, they can rest assured that their purchase will be repaired or replaced if something goes wrong. This gives customers the comfort and security they need in order to make smart spending decisions for themselves and their families. Since our launch, Extend has worked with merchants to offer different types of protection plans that cover the full range of issues customers may encounter.
An ADH plan, or Accidental Damage from Handling plan, from Extend covers dropping your computer, spilling wine on your new handheld gaming device, and of course sitting on your headphones. This is the type of coverage you get from AppleCare when they replace your cracked screen after an accident. ADH protection plans start on the date of purchase, and go above and beyond the coverage of a standard manufacturer’s warranty.
Standard extended warranties, on the other hand, extend the length of the manufacturer's warranty beyond the term of coverage that is normally included with the product purchase. Standard extended warranties give a consumer protection against mechanical and electrical failure that happens after the manufacturer's warranty has expired. These are great for TVs, home appliances, auto parts, and other products that should last a long time and that you probably won’t break by accident.
Giving your customers value-add services at the point of sale is a surefire way to engender respect and loyalty from your customers. Financing options and extended warranties help ensure that customers are able to conserve cash in tough times, and protect the investment they make in their purchases. How merchants interact with their customers today will ultimately determine who falters, and who survives and thrives after the coronavirus threat has passed.
Please take care, be safe, and remember to treat others how you would like to be treated.