Home Warranties: Driving Revenue through Enhanced Home Protection and Great Customer Service Experiences - HubSpot
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
Home Warranties:
Driving Revenue through Enhanced Home Protection
and Great Customer Service Experiences
e-Book Series
Home Warranties:
Driving Revenue through Enhanced Home Protection and
Great Customer Service Experiences
Home
A home, by its definition is a place where we live. It’s where we’ve laid
roots, raised our families and is the center of our lives. Most homes
have similar systems- appliances, heating and air conditioning, water
heaters, electrical, security, etc., that need to be maintained and
repaired from time to time.
However, we know that home ownership is changing. In 2019, the
home market looks different than just a few years ago.
• Home sales are increasing. However, as
Boomers and GenXers continue to lead home
purchases, both populations are aging. Home
maintenance, even as simple as replacing things • Consumers upgrade some devices as quickly as
like water and HVAC filters, is a growing need every 2 years.
for both generations. Millennials buy homes and
have families later in life, but they invest in • New connected technology enables consumers
mobile and smart technology earlier and more or in-home techs to easily inventory products in
frequently than other generations. a geolocation.
• Adoption of smart technologies continues • Revenue in the smart home market is expected
to increase, though Boomers, Gen Xers and to grow by 13%3 by 2023 to $44,791m
Millennials have differing levels of technology
adoption, across specific devices. • Home warranty revenue is expected to grow
50% annually from 2.3B4 in 2016, and yet suffers
• Rates of connectivity via internet enabled a bad reputation based on widespread claim
devices, like phones and tablets, versus avoidance practices necessitate by high adverse
traditional home networks is increasing. selection.
• Consumer homes, or ‘geolocations’ have 13+ 1 • Boomers and Gen Xer era service technicians
connected devices, with 3.42 smart devices such are leaving5 the workforce, while Millennials
as appliances and thermostats per home on backfill their ranks but have different skills and
average to drive convenience. needs.
OnPoint Warranty Solutions LLC | Home Warranties: Driving Revenue through Enhanced Home Protection and Great Customer Service Experiences
hello@onpointwarranty.com | www.onpointwarranty.com
It’s also clear that the service industry, including manufacturers, What are home warranties?
third party service contract and home warranty administrators,
Home warranties are similar to insurance policies or service
retailers, and service providers, are in the midst of an evolution.
contracts which cover products and structural elements of a
Emerging technologies like IoT and 24x7 connectivity through residential building.
smart devices have transformed the way homeowners buy
products, and how they expect to communicate with service
providers. It also changes the feedback loop and NPS ratings, Sold for a fixed term, for a fixed fee, some policies
since consumers don’t hesitate to jump onto social media sites simply cover appliance packages which include the
like Facebook and Twitter to evangelize or demonize a product kitchen appliances, while others cover additional
or a service experience. They expect manufacturers and service fixtures, such as HVAC or boilers, or water heaters.
providers to interact with them throughout the product Others cover home systems as well, such as:
lifecycle, in real time, and via new communications channels • Air conditioning and Heating Ductwork
like social media and chat or text.
• Electrical
• Plumbing and Stoppages
• Water Heaters
• Doorbells
• Smoke Detectors
• Ceiling Fans
• Central Vacuums
• Garage Door Openers
• Built-in Food Centers
• In ground Pools and Spas
• Well Pumps
• Water Softeners
• Septic System Plumbing
Typically sold by real estate brokers, builders, or mortgage
companies at the time of a home sale, or directly to consumers
by administrators, home warranties are increasingly being sold by
other entities such as manufacturers, retailers, service providers,
utilities and through loyalty programs like the AARP or AAA.
Home warranties are desirable by home owners because they
provide protection for the unknown. In fact, home warranty
administrators sometimes feed the fear of the unknown in their
sales pitches and commercials.
Similar to insurance policies in many ways, and even regulated
So, while home ownership and what it entails is relatively steady,
by some US states as insurance products, much like service
in terms of homeowners needing to make sure home systems
contracts or extended warranties on consumer goods, home
work efficiently and predictably to maintain their family’s
warranty administrators require the home owner to contact them
comfort, homeowners continue to seek out home warranty
in order to go through entitlement and secure an appointment
solutions to provide ‘insurance-like’ protection for home
for repairs, and subsequently dispatch a field technician to
appliances and systems.
deliver services.
OnPoint Warranty Solutions LLC | Home Warranties: Driving Revenue through Enhanced Home Protection and Great Customer Service Experiences
hello@onpointwarranty.com | www.onpointwarranty.com
Current Market Conditions
There are several home warranty
administrators in the market now.
The industry today in the US is
estimated at $2.3 billion and has been
growing at an attractive rate.
However, the industry is plagued
by stagnant product offerings, poor
service delivery and low customer
satisfaction, and an evolution of
new technologies, but a total lack of
innovation.
According to IBIS World, the market’s
largest participant grew in revenue
from 5% to 10% annually between
2009 and 2016.
However, they continue to offer products which cover only pre-authorized and known cost. This is despite the fact that field
appliances and home systems at a single physical location. service management software is abundant, cheap and relatively
easy to deploy.
Innovative solutions which can protect other products, like
smart technologies and devices not resident in the home Home warranty administrators don’t perform well in terms of
location, are not readily available. CX, as a matter of fact. Look on the web for ready and frequent
examples. Yet, homeowners renew coverage at a rate of 50% on
Current market players are challenged by managing home
average, each year.
warranty claims in a way that protects their reserves, while
making their customer happy, which increases NPS scores and Current home warranty administrators are also limited in
drives future revenue. offerings based on the sources of underwriting for their policies.
Moreover, entitlement, especially outside of a call center, There is a limited pool of underwriters in the market with the
exactly not where a lot of consumers want to end up, isn’t fast, experience to underwriter home warranty programs, particularly
automated, or easy. And, home warranty administrators outside of standard appliance and HVAC products, thereby
across the board continue to struggle to recruit, credential and limiting what is available to consumers to purchase. The market
manage a team of tradesmen which will provide services at a is simply not addressing protection for electronics, mobile or
computing devices, which are so dear to the Millennial heart.
OnPoint Warranty Solutions LLC | Home Warranties: Driving Revenue through Enhanced Home Protection and Great Customer Service Experiences
hello@onpointwarranty.com | www.onpointwarranty.com
Market Opportunity
For manufacturers, retailers, service providers, utilities, affinity groups, builders, realtors and more, home warranties are a no
brainer. Consider the following:
• The industry is worth 2.3B a year. • The current providers continue to be the poster
• The industry is growing at 5% growth per year. children of bad PR.
• The industry sees 50% renewal rates each year. • The average selling price of home warranty is
around $500-$600 per year. The average margin
• Only 5% of homes in the US are covered by a for a reseller is 20-30% on a whole home plan.
home warranty today.
• New marketing technology expands marketing
• Current providers deliver poor service channels outside the mailbox, to SEO, PPC,
experiences. retargeting and social advertising, reaching
• Current product coverage is highly priced, and homeowners on their devices anywhere.
limited in breadth. • New technology makes it easy to inventory
• There are limitless opportunities to expand products in a location by either a field technician,
coverage to capture the millennial buyers as well or a consumer directly, creating a larger lead
as traditional homeowners by simply offering pool of potential products to cover than simply
coverage on additional products. assuming each household has 5 appliances and an
There are also huge opportunities to capture HVAC unit.
revenue from other services, like network set up, • Omnichannel consumer technology makes it
smart product installation, repair service on non- easy for homeowners to request service, buy
covered products, and even simple yet so valuable and manage their plans and purchase new
services like filter and bulb changing. coverage as the products they own change,
while decreasing administrative costs due to the
automation.
With such ample opportunity
to capture your customer’s
homes, increase revenue
and the lifetime value of
that customer, while doing
so in a way that drive a great
service experience for your
consumers, why wouldn’t
your organization want to
sell home warranties?
OnPoint Warranty Solutions LLC | Home Warranties: Driving Revenue through Enhanced Home Protection and Great Customer Service Experiences
hello@onpointwarranty.com | www.onpointwarranty.com
Delivering Personalized Product Protection for Consumers and
Greater Long-term Revenue Opportunities for Resellers
HomEase, a new B2C brand developed by OnPoint Warranty, offers resellers, under our brand banner or yours, the opportunity to
expand your business directly to consumers and homeowners, through personalized product service solutions.
HomEase offers consumers a subscription service which provides the ability to personalize and update product protection for their
current and future inventory of home and mobile technology, through an ala carte menu of service contracts and extended warranties,
home warranties, on demand repair services and even home health checks.
The breadth of options HomEase offers provides installation and user training, troubleshooting, repair and maintenance options for a
variety of products ranging from electronics, computing and networking, mobile devices, smart home products, to appliances and home
systems. The wide range of services and coverage options appeal to both aging Baby Boomers which have the highest rates of home
ownership, as well as Millennials whom are purchasing homes later, but tend to be early technology adopters.
HomEase offers more than traditional home warranties or service contracts. Compare our menu to the industry:
Home
Features Description HomEase Warranty
Products Covered Major Appliances X X
HVAC System X X
Plumbing Systems X X
Electric Systems X X
Mobile Phones X
Laptops, Tablets, Desktops X
Small Home Appliances X
Coverage Types Mechanical Breakdown X X
Surge Protection X X
Food Loss X X
Accidental Damage from Handling X
Theft & Loss X
Setup & Installation Services X
Online & Call-in Technical Support X
DIY Parts Ordering X
Cataloging of All Items in Home X
Auto Assemblage of Owner’s Manuals X
Offer Strategy One option (products, coverage, price) X
Build your own plan of products, coverage, price X
Payment Methods One-Time Payment of Contract X
Monthly Payment of Contract X
At Will Add/Delete of Devices Covered X
Service Strategy Designed to not pay claims unless required X
Designed to offer high-touch easy service X
OnPoint Warranty Solutions LLC | Home Warranties: Driving Revenue through Enhanced Home Protection and Great Customer Service Experiences
hello@onpointwarranty.com | www.onpointwarranty.comOnPoint will deliver the best customer experiences, improving your brand image, as well as repeat sales and
downstream revenue with HomEase!
Built upon a foundation of consumer first technology, a highly capable, credentialled service network, A+ rated
insurance partners, a wide portfolio of product service solutions and the team’s deep experience in product
service, HomEase is the launch pad to more sales, higher revenue and increased margins. HomEase is the
product protection and service solution of choice- a one stop shop for home and product owners alike.
HomEase makes offering protection for products in the home easy for your consumers, and getting
support from our team of ‘customer avengers’ even easier.
Contact us today to find out how OnPoint Warranty Solutions
Home Warranty Products drive revenue for your organizations!
1
https://www.mediapost.com/publications/article/302663/north-american-consumers-to-have-13-connected-devi.html
2
https://www.ecnmag.com/data-focus/2017/05/more-40-percent-americans-have-adopted-smart-home-tech-whats-stopping-rest
3
https://www.statista.com/outlook/279/109/smart-home/united-states
4
https://www.homewarrantyreviews.com/news/home-warranty-industry/
5
https://fieldserviceusa.wbresearch.com/millennial-new-talent-acquisition-strategy-field-service-technicians-ty-u
ABOUT ONPOINT WARRANTY SOLUTIONS, LLC.
OnPoint was launched by customer experience experts with proven success helping global brands deliver underwriting,
service contract and manufacturer’s warranty programs, service fulfillment, service administration technology and logistics,
to drive the highest levels of consumer experience in the service industry. Building on the foundation of a connected,
multinational service network, omni channel customer interactions and consumer-focused technology, OnPoint creates
brand loyalty through service contract and service solutions designed to reduce risk, increase efficiency, delight consumers
and improve our customer’s bottom line. For more information, visit our website: www.onpointwarranty.com.
You can also contact us at help@onpointwarranty.com or dial 877.668.4681 to learn how OnPoint can help your team deliver
excellent customer experiences!
OnPoint Warranty Solutions LLC | Home Warranties: Driving Revenue through Enhanced Home Protection and Great Customer Service Experiences
hello@onpointwarranty.com | www.onpointwarranty.comYou can also read
