Key role of used car warranties

Key role of used car warranties

In the representative survey, both vehicle buyers and dealers were surveyed, a total of around 1,500 people. This creates a clear picture of what customers want – and where retailers can still optimize. A used car guarantee is already a prerequisite for customers: a majority of participants say that they see such a service as a “must have”. With terms of at least 24 months, there is even more potential: only 25% of participants consider such a service to be self-evident - while more than 60% see it as a “service that inspires”. The offer of a short-term guarantee is therefore sufficient to meet the basic expectations of interested parties. In order to have an exciting offer, retailers have to offer more and rely on terms of at least 24 months. According to the study, only 22% of car dealerships are doing this so far. A lot of potential is lost here.

The further results show that such an offer is worthwhile even beyond the fulfillment of customer expectations and the associated effect on customer loyalty. Actively offering a guarantee significantly increases the likelihood of recommendation and purchase - sometimes by up to 20%. In addition, retail satisfaction with sales deals increases significantly: from 39% when there is no offer of a GW brand program to 50% when there is an existing offer. Exploiting this potential is all the more important because it means customer expectations can be met and an increased willingness to pay extra can be used. For example, more than 50% of participants would like an extension offer after the used car warranty expires and are also prepared to invest something: at the peak, they consider surcharges of more than €40 per month to be realistic. This willingness to pay a surcharge increases significantly if a corresponding offer is actively made.

The active offer of a corresponding extension is therefore clearly worthwhile for retailers. Such offers are possible, for example, via direct marketing services such as CarGarantie's customer contact program: Here, customers receive letters with offers, such as warranty extensions. The CarGarantie customer contact programs achieve completion rates of up to 28%. Retailers are aware of the advantages of a guarantee: a majority of the companies surveyed stated positive effects on customer loyalty and satisfaction. It is all the more important that retailers do not just leave this theoretical knowledge behind, but also turn this into an active offer. Marcus Söldner, CEO of CarGarantie: "CarGarantie offers the trade tailor-made programs with warranty and repair cost insurance that meet both the expectations of customers and the needs of the trade - and thus supports the implementation of the results of the study. The customer contact program in particular with its good completion rates is an effective means here."