When making a purchase, customers want to feel confident that they are spending their money on a quality product or service. Even if you offer the highest quality product or service, your customers are likely going to feel much more confident if they are protected by a guarantee and have recourse if they are unhappy with their purchase.
There many reasons business owners implement some sort of guarantee on their products or services. Before you determine whether a guarantee is best for your business, weigh the pros and cons of offering a guarantee.
Inspire consumer confidence
Illustrates you stand behind your product or service
When you offer a guarantee on your product or service, you're illustrating that you are so confident about your product or your service that you are willing to offer your customers' their money back if they are not satisfied.
When you are confident in your product or service and you convey that to your customers, they, in turn, are going to become more confident in purchasing from you.
Allows you to fix any problems that arise
Offering a guarantee will allow you to assess the problems that are arising from your product or service. For example, if you notice you are getting a high number of returns on a particular product, you can talk with customers to pinpoint the exact problem then you can work to fix that problem.
Will increase consumer spending
When your customers know they are protected by some sort of guarantee, they are going to be much more likely to purchase from you again and again.
Advantages outweigh the disadvantages
One of reasons some business owners don't want to offer a guarantee is they worry about being taken advantage of by unscrupulous customers. When deciding whether or not offering a guarantee is right for your business, consider both the advantages and disadvantages as you see them.
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The fact is, whether you offer a guarantee or not, you are going to have to deal with unscrupulous customers at some point during the lifetime of your business. If you offer a guarantee, you will have those customers that see fit to take advantage of your guarantee, but the majority of your customers will not use you.
Be careful with service guarantees
Regardless of what you are selling, you are going to have some people who try to take advantage of you and your guarantee. It's to be expected in any business. However, if you have a service-based business, you are going to have to be much more careful.
For example, if you are offering a service such as writing or Web design, you'll likely not want to offer a 100 percent money-back guarantee. Instead, you might want to offer a guarantee that you'll provide up to two revisions for the price you've quoted.
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