The Warranty Effect: Shaping Consumer Purchases with Brand Fortress HQ | EP. #124

A warranty is more than just a guarantee that comes with a product, it’s a brand’s promise. On this 124th episode of the E-Comm Show, Andrew Maff interviews Michael Kaufman, co-host of Brand Fortress HQ. Micheal challenges the status quo by offering unlimited free replacement or 100% refund lifetime warranty, all through a user-friendly, online auto-approval app for hassle-free, 90-second warranty registration and claims.

In this episode, Michael discusses how a warranty is more than a piece of paper- it’s a promise from a brand to stand behind you, an acknowledgment of your trust, and a commitment to do what's right. Most of all, it’s the reason that Michael's e-commerce store Protuff has been able to build hundreds of positive reviews and gain a loyal following, all while staying profitable. By doing what most vendors are scared to do- Michael teaches us the power of an authentic warranty. 

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Andrew Maff and Michael Kaufman

CONNECT WITH OUR HOST: AndrewMaff.com  |  Twitter: @AndrewMaff | LinkedIn: @AndrewMaff 

Michael Kaufman

Mike Kaufman is a seasoned expert with a dynamic background that makes him an invaluable resource for any discussion related to Amazon selling and brand development. As a co-host of the 'Brand Fortress HQ Podcast' and an OG in online sales, Michael's journey in e-commerce spans nearly three decades, providing him with a deep understanding of the digital marketplace.

Professional Background:

Michael's entrepreneurial journey started about 40 years ago, selling "tree branch & tire tube" slingshots to all his buddies in the neighborhood. More recently, it's marked by over 15 years in the D2C space selling long drain premium synthetic oils and high efficiency filters, the publication and successful online sale of "The Motor Oil Bible", as well as the creation and nurturing of a mid 7-figure brand on Amazon, namely ProTuff Products LLC.

Under his leadership, ProTuff has become a recognized name in the niche of pool cleaning tools, offering an array of products like pool nets, telescoping poles, and brushes. His approach to product development and customer service has set ProTuff apart in the competitive Amazon marketplace.

Innovative Approach:

Michael is known for his innovative strategies in product quality, customer satisfaction and post purchase process. ProTuff's products are designed for enhanced durability, often outlasting competitors' offerings by 2-3 times. The brand's unique selling proposition includes an unlimited free replacement or 100% refund lifetime warranty, with a user-friendly, online auto-approval app for hassle-free, 90 second warranty registration and claims.

ProTuff's warranty registration and claims process provides the back-bone for a robust post purchase process that has been instrumental in building an email subscriber list of nearly 35,000 high income pool owners and a 50% email open rate. By building and nurturing this list, Amazon product launches have become a truly "organic" process which require minimal discounting, and turn a solid profit from the very beginning.

Customer-Centric Vision:

Michael's deep understanding of his target market has guided ProTuff's product development and marketing strategies. He ensures that ProTuff's tools not only serve their functional purpose but also that the product features and messaging carefully align with the lifestyle and values of their users.

Industry Contribution:

Beyond ProTuff, Michael shares his wealth of knowledge on the 'Brand Fortress HQ Podcast,' and through the 'Brand Fortress HQ' mentorship program, where he, along with co-hosts Jon Stojan and Matt Atkins, offers actionable insights and strategies for Amazon sellers. Michael's ability to breakdown complex e-commerce concepts into understandable and applicable advice makes him a tremendous resource for anyone looking to enhance their brand image, protect against copycats, and build out an Amazon post-purchase process that insulates any brand against an "Amazon shutdown".

00:03

The only reason that we are believable is because now we have such a massive review profile that proves that we stand behind it but if you're starting out you know you don't have that so at least you know make it extreme but make it believable

00:21

I want to show you show you an awesome yes

00:40

guys

01:08

hello everyone and welcome to another episode of The E-Comm Show. I'm your host, Andrew Maff. And today I'm joined by the amazing Michael Kaufman, who's a brand owner over at Pro Tuff Products. Michael, how you doing ready for a good show?

01:19

Doing great.

01:19

I'm ready. Beautiful. Super excited to have you on the show. I'm really looking forward to getting into this one. I've got relatively similar experience. But I'm super excited to hear on your end. I like to always start this off the same way. I'd love to give you the opportunity to kind of tell everyone a little bit about, you know where you've been where you're at now, some of your background? We'll take it from there. Okay.

01:40

Sure. Yeah, absolutely. So I've been in ecom, for almost 30 years, I've been on Amazon for close to 10. So kind of an OG in that space. And so we a lot of what we do centers around post purchase process and list building and utilizing that for better launches, better reviews, you know, customer interaction, that sort of thing. And so actually, myself and a couple of other guys have actually started a mentoring program over at Brand fortress hq.com, as well as a podcast to go along with that. So if anybody's looking for assistance with their Amazon business, specifically with relationship to brand building, and post purchase process and list building, that sort of thing, it's kind of what we do so

02:29

beautiful. The post purchase thing, especially through Amazon, traditionally a nightmare, also something that most sellers completely ignore, they spend so much time trying to get someone to actually buy something, and then they just ignore them after they do actually purchase something. So tell me about that. What is what is the process what you know, what are you kind of implementing post purchase.

02:51

So our so our brand is we sell pool cleaning tools. In that space, it's a very commodity space, most of the products out there are quite crappy. So we basically upgraded everything so that we have a really high quality product, you know, good features. But in terms of the post purchase process, the way that we've implemented it is through a warranty. So we offer an unlimited free replacement lifetime warranty on all of our products. And that obviously is fairly valuable, especially since we sell it about five times the price of most of the other products in our category. So if you're going to spend that kind of money, you would want to take advantage of the warranty that was advertised. So we do get pretty good good response rates on that we get about a 30% response rates from our package inserts. And of course, we're continuing to split test to improve that, but and so we get both email and we get our physical addresses. Because since it's a warranty, at registration, we asked for that physical address and just say, Hey, we're going to need to ship you something down the road. So we'll need your address. We don't require it. But 90% of our registrations actually do include the, the address. So that actually proves pretty useful for us, and has given us well, we've got about 35,000 people on our subscriber list and we get about a 50% open rate on just about anything we send out. So Wow.

04:22

So the immediate question I know that of there's a handful of listeners who will email me like after every episode, and they listened to it unless you pick it apart. And one of the immediate questions I know this one guy is going to have the terms of service on Amazon on when you can or cannot do mention a warranty and I would imagine the way you're alerting people these warranty or at least how to get to the site would be through some kind of insert or something like that in the product packaging. Am I correct? Yeah.

04:55

Yeah, definitely an insert. In fact, actually on most of our products, we actually use a hanger So one of the things that we discovered, and that actually was a big switch. So we had inserts, which did relatively well. But when we switched to the hang tag, we nearly doubled our response rate. And so essentially, the issue there is, and I would caution, every seller, if you're going to try to institute a post purchase process, and you're including some sort of answer, you have to make sure that the customer has to interact with it in some way. And by using a hang tag, especially because of the way our product operates, they have to remove the hang tag in order to use the product, it's impossible to use it without it. So so they have to interact and not instantly gave us an overnight, you know, massive increase in response rate. So if there's any way that you can make an adjustment to how you're using an insert, to make sure the customer absolutely has to interact with it, I guarantee you, you will see a much better result out of that. But in terms of tos, I have a few perspectives on that. One is, Amazon certainly cannot bar you from offering a warranty on a product, they may be able to bar you from advertising it on your listing, technically. But I would say we've fairly successfully gotten around that, and we've never had an issue with Amazon, like the the worst issue that we've ever had with Amazon was just simply the listing was suspended. But it was more, you know, like, it wasn't an administrative thing, it was just the algorithm, you know, like, it just turned off the listing. And we made, you know, we change the image back or we did you know, whatever listing came back up again, and we just play around with it, you know, like, we've got lifetime warranty, and virtually every main image of every product that we sell, and there's there's creative ways that you can get around the algorithm, one of the ways that we found that actually is kind of useful is that, obviously, the human brain can fill in the gaps, right. So like, if there's a letter or two that are covered in a message, if the message is one that's fairly obvious, you know, the the person looking at it is going to know, the algorithm is not going to pick it up. So if the algorithm is picking up the word warranty, say in your main image, if you just do it in such a way, so that product covers a little portion of that message, the customer can still read it, obviously, but the algorithm can't pick it up. So that's one easy way to get around that.

07:24

That's awesome. I love it. I know a lot of people are gonna be like, oh, yeah, you're gonna get caught one day, blah, blah. I think, you know, Amazon's TOS in terms of like driving traffic to your website, and the inserts and all that stuff, I really don't feel that the way it's written is as black and white, as a lot of people make it out to be. And then to your point, like, they can't really stop you from offering a warranty. And then as far as I'm aware of the TOS, and insert, or to your point, which I liked the idea of in better of doing like a hang tag, if it's in the product packaging, it's considered a part of the product, have you thoughts on that is that kind of how you stand with it,

08:03

that's the way I perceive it, that's the way I would look at it, you know, and I also would say that the warranty is part of the product. Like, I mean, if you if you buy a product, like I mean, the warranty is the reason you pay the price that you pay oftentimes is because it has a warranty or if it doesn't, then you expect to pay less. So from my perspective, it is a part of the problem. And so I don't really concern myself too much with it. I mean, as I think that, you know, obviously, there's the you know, the obvious things, you know, don't be putting an insert in there that ask for a five star review Don't be you know, I mean, there's all of the obvious stuff, you know, but But again, if I offer a warranty on a product, if Amazon's main thing is take care of the customer. Well, a warranty is useful if you actually stand behind it. And we do like I mean, our our review profile for virtually every product on Amazon has a full five star reviews. So we clearly stand behind it. I I'm not going to worry about it. You know, I mean, it's it's effective. For us. It's useful. It gets us the registrations, we take care of the customer. I mean, we're, I would say one thing, if, if you decide to offer a warranty, I would say well, I would say two things, one, make it extreme, but believable for your category. So if you can, if it's at all possible, I would three to 5x whatever anybody else in your category is doing, but I would price accordingly so that you can afford to do it. But I would also put a time limit on it. One of the things that I think we did wrong, is to make it unlimited free replacement for life. Because it doesn't sound believable. You know, like from a customer's perspective. Like, that's ridiculous. Nobody's going to do that. Who could afford to do that? There's a whole bunch of reasons why we can't afford it. But a customer doesn't know all those reasons. And so do it is doesn't sound reasonable. Also, it makes it hard from a marketing perspective to calculate the value that they receive, because it's infinite, right like it never ends. But if if everybody else in your category offers a one One year and you offer a five year, well, then you can instantly calculate the value, you know, they can calculate it in their head. But certainly in your marketing, you can calculate it, there's numbers that you can use. We can't do that, you know, it's not, it's not effective in that way. So we're not believable. The only reason that we are believable is because now we have such a massive review profile that proves that we stand behind it. But if you're starting out, you know, you don't have that. So at least, you know, make it extreme, but make it believable, I think is a, you know, important piece. How

10:31

much? You know, I mean, I know the business has been crushing it, but you've been at it for years. I imagine a majority of it is Amazon, what, what would you say is the percentage from Amazon versus your DDC site?

10:45

Quite frankly, at the moment, it's all Amazon. So we actually are opening up our, we had DTC available a while back, we transitioned to pushing everything to Amazon. And part of the reason that we did that was because we started to lose a little bit of ranking against a lot of, you know, new Chinese sellers at a very low price point. It just, you know, and we, we actually had, it's one of those things where we had a number of issues, that kind of all came together at one time, and we lost some ranking. And it was actually really difficult to get back. You know, once you've lost it, when you've got so many low price competitors that take those spots, then it's hard to come back from that. And so one of the things that we started doing was just all traffic was going to go to Amazon, we weren't going to process it on our website at all. That did help to some degree, but we're going to reopen the the DTC site, in mostly because we actually are moving into we, in the past, we haven't really sold a whole lot of, say, auxiliary products, let's say, you know, back end products, which is kind of silly. I mean, we've got a massive list of people who are very loyal to the brand, like, why wouldn't you do that, right, but it just never became a priority for us. So that's actually one of the ways that we want to move this year to really increase our profit. And our revenue is to start offering products on our website, because we can sell at a pretty high high school, high price point with our warranty. And there's really no reason we can't offer that warranty and a lot of other products that we could sell. And if we're not on Amazon, there's nothing else on the shelf at a lower price, you know, like they're coming to our site, we can sell at whatever price we want, and be fairly effective at it. So, you know, at present, everything is Amazon. But hopefully, as we move forward this year, it'll be less and less the case.

12:35

As you start to move into the DTC side. Are you thinking of exploring the whole buyers prime functionality? Are you going to try to keep the two channels completely separate?

12:44

You know, we're not entirely sure we were contacted by somebody from from Amazon about by with prime, you know, we we kind of have been tossing it around. There's benefits and drawbacks, I think, you know, at this point, I don't think we're going to utilize it, and we're going to see how things go, we may take a short bit and maybe test it and see, but we need, we need some startup data first, you know, like, we got to see how does it perform without it, you know, and then testing with it so that we have something to compare against?

13:10

Yeah. With, you know, one of the things you had mentioned about, you know, you've got a lot of loyal customers to the brand. And, you know, to say this, respectfully, it's full products, right? How do you gain such a solid brand loyalty around like, pull products, accessories, and things like that, it's, you know, it's typically you find a lot of brand loyalty around like, the sexy Instagram brands and things like that, but to get brand loyalty around, you know, something that's just kind of as needed sort of thing, like, how did you go about approaching that to build that community?

13:48

I think, if I'm being honest, I fell into it. Because so when we first started, when I first started, it was just me. You know, I, I basically was taking a product off the shelf, you know, from the manufacturer, I didn't hadn't made any adjustments to it. I didn't change anything. I was just throwing it up on Amazon to see what would happen, right? I've been in E commerce for a while I wanted a little bit different direction to what I was doing. So I thought I'd give it a shot. So in that moment, I knew I needed to differentiate. But I wasn't going to go to the trouble at that point, since I hadn't tested you know, Amazon at all, to go through prototyping and making changes and upgrading features and everything. So I was like, you know, what can I do to differentiate? Well, nobody was offering a warranty in the space and I thought, well, let's let's do that, you know, and so lifetime warranty became the thing. Now I didn't originally advertise it as unlimited free replacement. I started with just lifetime warranty. However, for me, what became obvious pretty quickly and again, I kind of fell into it was that I was extremely liberal with the warranty from the beginning. So You know, if somebody asked, I sent another one, right. And part of that was just because I didn't have any review profile. So I needed five star reviews, I certainly didn't want a negative review from somebody who, you know, was upset about the warranty, right. So as much as just ethically, you know, like, I want to stand behind it, there was also a tactical aspect there where I didn't want the negative reviews. But what became obvious really quickly, was how people responded to that. So the fact that I made the warranty so easy, they didn't have to jump through hoops. I approved virtually every warranty claim, the response from customers to that was always like, I can't believe you actually replaced it, you know, and it showed up two days later, and I didn't have to prove anything, I didn't have to send you any pictures. I didn't have to, you know, any of these things, right. And so it became really clear from from very early on was, I could build a massively strong review profile by doing just that. And those customers, like many of them would say to me, like, what else do you sell? Right? Because I want to buy it. If like, if the warranty is that easy? Why would I not buy everything from you, right? And so that just became a very strong signal to me that we were on the right track, this is the way we want to run it. And I know that I'll have loyal customers out of that, because they're telling me, you know, like, they're brand new to me, and they're already loyal because of how I handled that warranty. So if you can do that, I highly recommend it. I think it's a very strong. I mean, essentially, it's just doing something that's way beyond what everybody else is doing. Right? It doesn't have to be a warranty, it can be anything, you know, but but if you're doing it way better than everybody else, you're going to get burnt brand loyalty out of that, you know, like it's, it's, it's naturally going to happen. It just happened to be that we use warranty for that. But yeah,

16:54

do you um, you know, you mentioned you were basically liberal with the warranty in the beginning, like, how did you end up actually doing like the calculation of how many people actually take advantage of the warranty and figuring out like, how lucrative that may or may not be, because I could see like, you started off very liberal with it in the beginning. And it just happened to work out really well. But I could also see how someone could start doing that. And then that just comes back and completely by somebody else down the line. So how did you How do you figure out the math on that?

17:27

So there's a few things. I mean, first of all, we really couldn't calculate The math until we we had been in it for a few years, essentially, and doing it because we knew that the average lifespan of our product, you know, we began to see like, two three years was the average lifespan. Now we've had people that you know, 678 years, you know, it lasted but but average is probably three years. So we knew once we get past that three year mark, now we're going to start seeing a an uptick, right, like, that's what we were expecting. So like in the early stages, you know, it was a very low percentage of revenue. It was insignificant reasonably. I knew once I got past that three year mark, you know, okay, now it's going to start to increase, what is it going to look like, and it didn't increase, you know, I mean, reasonably speaking, but not nearly as much as I expected. And so I would say, you know, like, just to throw out some numbers right now, nine, year nine plus years in, and with virtually all of our products really having kind of that, you know, two to three year lifespan. We, I just did a calculation actually recently, because we've got a potential buyer, who wants to know, are in 2023, we sold 75,000 units, we sent out 6500 replacements under warranty claim. However, most of those are parts. So we actually were moving even further in that direction. But so that amounted to 3% of revenue. And if I recalculate that, based on we're making an adjustment to one of our products, so all of our pool, rakes are pool nets. They're a singular piece, I mean, it's all glued together. So if somebody needs a replacement for their pool net, I have to send them an entire pool net. That's fairly expensive, especially now as fulfillment costs have gone up. So we've redesigned that. So it's a modular rake, so I can send out parts. And I also know what the parts are that most people need most frequently, and I can ship those very inexpensively the part itself doesn't cost much so that 3% of revenue that we spent in 2023 will be about 1.75% of revenue and 2024. And so it's actually a you know, it's not it's not insignificant, but in relationship to our profit margins. You know, I mean, Again, we sell it five times the price and most everybody else in our category, like, it's really a drop in the bucket. And when you think about what it does for you, from a, you know, a review profile perspective, and the brand loyalty perspective and being able to sell on the back end, and what you could do with consumables, like if you're a durable goods, because that's another area that we're moving into this year. So to some degree, this is theory, but I would say really strong theory, and that is, my customers have already told me, I'll buy anything that you sell, right? They've already clearly indicated to me, they're willing to pay more for my products, right? Why would it not also be true, if I offered a strong guarantee on a consumable product, like pool test strips and chemicals and things like that, all the evidence suggests they would pay me a premium for that, because they would know if they ever had a problem with the product, I just replace it or I'd refund it, you know, like, they already know, I'm going to do that. So I can almost guarantee I could sell any consumable in my space for probably 15%, maybe 20% more than anybody else in the category, I can sell that all back end, I don't even have to sell it on Amazon. So I can save the fees. So you know, if you're in durable goods, if you prove to them through a warranty, that you're gonna stand behind it and take care of them and you sell it a good margin, then you can easily move into consumables in that space, and your customers are going to buy those as well. Because if you guarantee them the same that you buy, you know, guarantee your durable goods, why would they not, and you can sell them again at a premium. So I think there's a strong argument to be made, that you could do it, I think a couple of other things that are critical there is the type of product like our product, in a lot of ways is very much like a for different reasons. But it's very much like a fitness product, tick a fitness product, think about how you would if you were doing warranty on that, right? Most people when they buy a fitness product, they buy it with the intent of using it on a regular basis for years to come, right, like I want to get in shape, I'm going to buy this product, because it's going to help me do XYZ, I'm gonna use it every other day. And what generally happens two weeks later, it's in the closet, and they never use it again, right. But in the moment of purchase, they believe they're going to use it regularly for an extended period of time. So if you tell them, if you sell them elastic bands, and you say we offer a seven year warranty, unlimited free replacement, in their mind, they can calculate that and they're like, Well, I know elastic bands don't aren't going to last seven years, if I'm using them regularly. So I'm probably going to get two or three replacements out of that, you know, maybe more. So their calculation is it's worth it. Because they're not thinking it's going to end up in the closet. But for you, as the brand owner, you know, there's a large percentage of people that you're never going to have to fulfill that warranty for which means the ones that you do fulfill on you can treat them like a king. And they're going to love you. And they're going to give you referral business and reviews and all of that. So I would say if you're in a business where and you're selling a product where it's like that, you know, like pool products, it's different, but it works the same because you buy it for a pool that you own with this house, there's a lot of people who move into a new house that don't have a pool. They hate cleaning the pool, you know, so they move and they don't have one? Well, they don't take the tools with them. So nobody's going to request a replacement on that. So there's a lot of ways that you can actually minimize that expense. I would also recommend modular design, like if you find that there's parts that are getting replaced, change the design, make it modular, so you can just send them the part.

23:35

How do you in this scenario? So when someone makes this purchase, are they required to register to get the warranty? Or is the product automatically warrantied?

23:46

It is automatically warrantied. We essentially will allow them, they do end up having to register prior to a claim. But essentially, if they don't register it early on, it's part of the claims process like they register and then immediately it flows into the claim. However, we do incentivize registering sooner, you know, so that would be my my argument would be you know, so for instance, a good example would be an ID. And again, this would be better for us if we had started with an actually defined warranty length, right? So if everybody else was offering a one year, you offer, say a three year or a four year on Amazon, right? Like you advertise that. But then the insert or the hang tag or whatever it is says hey, register within the next seven days and double the length of your warranty. Right? That's a pretty massive incentive to register early on, especially if maybe there's also a giveaway attached to it or something like that, like we do a monthly giveaway that's attached with that when they register their warranty, they're entered in the giveaway. So there's all sorts of things that you can do to provide that extra incentive but I actually think a well defined warranty length and then doubling it or adding a couple of years or whatever, you know, with that insert, I think is a really good way to make use uh that yeah

25:02

beautiful a lot of stuff to think about Michael I really appreciate your time and I want to take up too much more of it I know you're super busy. I would love to give you the opportunity to hear let everyone know where they can find out more about you of course more about protests and of course about brand fortress.

25:15

Absolutely. So yeah, if you're in the market for a pool cleaning tools and you want a good warranty, protuffproducts.com P R O T U F F is Pro Tuff. If you're interested in any mentoring, or we've got a free Amazon basically post purchase funnel blueprint that we give away at brandfortresshq.com You can check out the brand fortress HQ podcast or you could find me on LinkedIn. 

25:41

Beautiful, Michael, thank you so much for your time. Everyone who tuned in of course thank you as well please make sure you do the usual rate review, subscribe all that fun stuff on whichever podcast platform you prefer or head over to the E comm show.com to check out all of our previous episodes, but as usual, thank you all for joining us. We'll see you all next time.

26:01

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