The Power of Promise – Why product guarantees work

A number of years ago, I purchased a tree from a local, well-established nursery. I did everything I was told to plant and care for the tree properly but the next spring the tree was dead. Since the receipt had “100% replacement guarantee” printed on the bottom I called to see about getting a replacement tree. The person on the phone made me provide a lot of information to prove I actually did buy the tree from them and then proceeded to grill me with questions about what I had done wrong. Finally I was told if I wanted a replacement I would have to bring the dead tree in so they could look at it.

Satisfaction guaranteedI was offended. I did not bring the dead tree in. I did not collect my original money or a replacement tree. I also never returned to that nursery and have since spent thousands of dollars on plants and products with other local businesses. About five years after this experience that particular nursery went out of business. And, nearly two decades after the fact I still remember this incident!

In the psychology of consumers there are few things more powerful than a simple guarantee. In most cases, it will cost you very little and it just might increase your sales and bring in some new business! 

When customers see that you stand behind your product it sends a powerful message. It says, “I am proud of my product“. A product guarantee says, “I want you to be satisfied and I am willing to do whatever it takes to see that you feel good about doing business with me“.

Furthermore, the implied message in a guarantee is “I value your business and trust your judgement.”  In the example above, the nursery in question lost my business not because a tree died or because they would not replace it. They lost my business because their policy and actions said clearly they did not trust me.

All of these sentiments help build the type of customer loyalty that our businesses need to face the relentless competition in the marketplace. Having a guarantee and promoting it will also set you apart from those competitors who aren’t willing to fully get behind their product.

Here are a few considerations about product (or service) guarantees:

  • Make it easy for customers to return products. It is perfectly OK to ask a few questions but don’t grill customers — remember the goal is to make them happy not annoy them more.
  • Be clear about what your guarantee covers — Is it cash back? Is it a replacement? Store credit?
  • Train your employees on how to handle complaints and, if you are not available, empower them to make judgement calls when it comes to refunds, replacements, etc. No one wants to hear, “we’ll have to check with the manager and get back to you…

 Are there risks to offering guarantees? Sure. Could you be taken advantage of? Sure. But not offering guaranteed satisfaction sets you up for even greater risks down the road.