Over 54% Online Product Purchases Are Denied Warranty! [MSP Study]

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There has been a lot of rumors that many people have issues to avail warranties on products that they buy online. A few words in reviews or a thread running with people upset about not getting warranties for their costly phones.

However, before now, there was no quantifiable way of discussing that. MySmartPrice corrected that with a survey of around 20000 people. This survey gave various valuable insights that tell us three very important things.

One, if you are buying online, there is a high chance of not getting warranty. Second, the chance of needing one is low and third, where you are (your location) matters a lot in getting your product warranty.

Let’s look at each one of them in detail.

High Chance of Not Getting Warranty For Online Products

According to the data, nearly 54% of the people got their warranty claim rejected. This is a very high percentage! This means that if you need to claim your warranty for an online purchase, the chance is higher that you will fail to get it.

An important addition here is that this mostly happens where service centers are owned or supported by offline retailers. This seems logical as offline retailers are sore about loss of revenue by online stores.

The gripe is going to show in some way and this seems to be the easier (and perhaps only) way to get back at people buying online.

Also, if the warranty is not claimed, people pay for it and offline retailers at least get some money out of it.

Online Products Warranty

Only 1.59% Purchases Need Warranty

Second data point is very important factor in buying something online. Despite only 45% people getting their claims, the relief is that only 1.59% people actually need it.

This implies that the quality of products sold online is high (or at least at par with their offline counterparts). It also means that there is no worry that products is shady or risky. It also means that a person can take a risk with buying a product online and the actual risk of not getting (or needing) a warranty is 0.85%.

This number honestly might be less than the probability of having an accident while going to an offline store. Thus, even with previous data, people are better off buying online especially with the deep discounts offered by online companies.

Your Location is Important In Availing Warranty

The third data point is very important location data. According to the survey, people in Metro were able to get the warranties easily compared to tier 2, 3 cities while getting warranty in rural regions is almost impossible. It simply adds to our earlier logic that third party service centers are not as keen on helping out online shoppers as the company service center (present in metro cities).

Issues With Warranty

In addition to this, the survey revealed the three primary reasons for getting the warranty denied:

  1. Lack of Seller Bill.
  2. Warranty Card not stamped.
  3. Device older than one year.

These are very important data points and solidify the age old discussion that offline retailers are not happy with online retailers and this sometimes ends up hurting the customer. The good news is that the percentage of people getting affected is quite small so online shopping is still a risk worth taking.

Let me know your thoughts on this.

[Via: MSP Report]

3 Comments
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