Search results

We investigate the extended service strategy choices of competing manufacturers and examine their impact on the retail platform.

We construct a supply chain model with a retail platform as the leader and manufacturers as the followers. Manufacturers face differential consumer preferences on the same agency retail platform, and they can sell a bundled extended service product and sell a separate product without any extended service.

The sale of extended warranty services on the retail platform leads to lower pricing of the manufacturers' products and changes in the product market structure in response to differences in consumer preferences. The retailing platform tends to provide an extended warranty conditionally. The sale of extended warranty services on a retail platform would be detrimental to the interests of the manufacturer who sells products with extended warranty services and in favor of the manufacturer who sells products without them.

The equilibrium results of the retail platform’s non-sales and sales of extended warranty services for the no-extended warranty product under the same commission rate and differential commission rate models are discussed, and the product structure of the market is investigated, respectively.

Warranty service plays a critical role in sustainability and service continuity and influences customer satisfaction. Considering the role of social networks in customer feedback channels, one of the essential sources to examine the reflection of a product/service is social media mining. This paper aims to identify the frequent product failures through social network mining. Focusing on social media data as a comprehensive and online source to detect warranty issues reveals opportunities for improvement, such as user problems and necessities. This model will detect the causes of defects and prioritize improving components in a product-service system based on FMEA results.

Ontology-based methods, text mining and sentiment analysis with machine learning methods are performed on social media data to investigate product defects, symptoms and the relationship between warranty plans and customer behaviour. Also, the authors have incorporated multi-source data collection to cover all the possibilities. Then the authors promote a decision support system to help the decision-makers using the FMEA process have a more comprehensive insight through customer feedback. Finally, to validate the accuracy and reliability of the results, the authors used the operational data of a LENOVO laptop from a warranty service centre and classifier performance metrics to compare the authors’ results.

This study confirms the validity of social media data in detecting customer sentiments and discovering the most defective components and failures of the products/services. In other words, the informative threads are derived through a data preparation process and then are based on analyzing the different features of a failure (issues, symptoms, causes, components, solutions). Using social media data helps gain more accurate online information due to the limitation of warranty periods. In other words, using social media data broadens the scope of data gathering and lets in all feedback from different sources to recognize improvement opportunities.

This work contributes a DSS model using multi-channel social media mining through supervised machine learning for warranty-service improvement based on defect-related discovery to unravel the potential aspects of social networks analysis to predict the most vulnerable components of a product and the main causes of failures that lead to the inputs for the FMEA process and then, a cost optimization. The authors have used social media channels like Twitter, Facebook, Reddit, LENOVO Forums, GitHub, Quora and XDA-Developers to gather data about the LENOVO laptop failures as a case study.

The study aims to design the limited number of random working cycle as a warranty term and propose two types of warranties, which can help manufacturers to ensure the product reliability during the warranty period. By extending the proposed warranty to the consumer's post-warranty maintenance model, besides the authors investigate two kinds of random maintenance policies to sustain the post-warranty reliability, i.e. random replacement first and random replacement last. By integrating depreciation expense depending on working time, the cost rate is constructed for each random maintenance policy and some special cases are provided by discussing parameters in cost rates. Finally, sensitivities on both the proposed warranty and random maintenance policies are analyzed in numerical experiments.

The working cycle of products can be monitored by advanced sensors and measuring technologies. By monitoring the working cycle, manufacturers can design warranty policies to ensure product reliability performance and consumers can model the post-warranty maintenance to sustain the post-warranty reliability. In this article, the authors design a limited number of random working cycles as a warranty term and propose two types of warranties, which can help manufacturers to ensure the product reliability performance during the warranty period. By extending a proposed warranty to the consumer's post-warranty maintenance model, the authors investigate two kinds of random replacement policies to sustain the post-warranty reliability, i.e. random replacement first and random replacement last. By integrating a depreciation expense depending on working time, the cost rate is constructed for each random replacement and some special cases are provided by discussing parameters in the cost rate. Finally, sensitivities to both the proposed warranties and random replacements are analyzed in numerical experiments.

It is shown that the manufacturer can control the warranty cost by limiting number of random working cycle. For the consumer, when the number of random working cycle is designed as a greater warranty limit, the cost rate can be reduced while the post-warranty period can't be lengthened.

The contribution of this article can be highlighted in two key aspects: (1) the authors investigate early warranties to ensure reliability performance of the product which executes successively projects at random working cycles; (2) by integrating random working cycles into the post-warranty period, the authors is the first to investigate random maintenance policy to sustain the post-warranty reliability from the consumer's perspective, which seldom appears in the existing literature.

To investigate the optimal burn‐in time from the perspective of minimizing the expected total cost (i.e. manufacturing plus warranty costs) per unit of product sold under a failure‐free renewing warranty policy. The conditions indicating when burn‐in becomes beneficial were also derived.

An age‐dependent general repairable product sold under a failure‐free renewing warranty agreement was considered. In the case of such a general repairable model, there are two ways in which the product can fail: type I failure (minor) can be rectified through minimal repairs; while in type II failure (catastrophic), the product must be replaced. Then optimal burn‐in time is then examined in order to achieve a trade‐off between reducing the warranty cost and increasing the manufacturing cost.

The optimal burn‐in time depends on the failure/repair characteristics, length of warranty, cost parameters and the probability of failure type II (catastrophic). A burn‐in program is beneficial if the initial failure rate is high or product failures during the warranty period are costly. Moreover, the optimal burn‐in time is always less than the infant mortality period.

The product considered in this paper is an age‐dependent general repairable product: on which no such study has yet been conducted. This is also the first study to apply a failure‐free renewing warranty to a general repairable item. It can be seen that the present model is a generalization of the model considered by Chien and Sheu.

Research in marketing has extensively examined the signaling effects of product warranties on consumer perceptions. Although this stream of research has focused on initial product warranties offered by the manufacturer, studies of extended warranties, which protect consumers against product breakdowns beyond the warranty constraints of the manufacturer, are relatively scarce. This paper aims to empirically establish the effects of variables which influence the pricing of extended warranties for consumer durables.

Using data on over 8,000 product offers in six durable goods categories, drivers of the annual premiums for extended warranties are empirically identified. Bivariate and multi-level hierarchical linear regression methods are used to establish the effects of factors which may drive the prices of extended warranties.

The results reveal that the standardized annual premiums for extended warranties systematically vary across product categories and brands and are further affected by the retailer’s decision to use odd price endings for the sold product and the extended warranty. The influences of warranty length and price level of the protected product on extended warranty premiums are also empirically established.

The findings indicate systematic variations in extended warranty prices as a result of the factors studied. Future research can extend this line of inquiry by utilizing alternative means of data gathering.

Given that marketers often cross-sell many consumer durable goods with extended warranty policies, and considering the growth in consumer spending in this category, as well as the high retail margins associated with extended warranties, this paper contributes to the understanding of the mechanism by which extended warranty prices are determined in the marketplace.

This is the first study to examine the determinants of extended warranty prices, as past studies have been normative and non-empirical in nature.

Examines the use of warranty and warrantor reputations, which have been shown to be credible signals of product quality for uni‐national products, to overcome consumers’ negative perceptions about hybrid products. An experiment is conducted, in which the level of warranty coverage and the warrantor’s reputation are manipulated. Results indicate that warranty strategies, in terms of warranty coverage and warrantor reputation, are effective in overcoming consumers’ negative perception about the hybrid product’s quality. Strategy implications for firms in the advanced and emerging economies are discussed.

This paper proposes optimisation models to evaluate and examine the selling of extended warranty policies in terms of improved profits in producing/marketing remanufactured products. These models are numerically solved using a quadratic programming solution approach and implemented in the decision support system (DSS).

The purpose of this paper is to develop the optimisation models for a DSS and evaluate different warranty policies for buyers.

This study has demonstrated the flexibility and usefulness of a model-driven DSS for the quality and warranty management, which is applied to examine and evaluate different configurations (i.e. component reuse, rebuild and recycle) for remanufactured products and propose the selling of extended warranty policies for buyers.

The developed model-driven DSS can assist manufacturers to select and increase the number of components, e.g. to be reused, rebuilt, and recycled for producing a remanufactured product and propose suitable warranty policies for buyers. However, this study focusses only on the evaluation of warranty policies for specific remanufactured products in a DSS, i.e. types of air compressors for production operations in manufacturing industry.

This study developed optimisation models to be used in a DSS for proposing the selling of extended warranty of a remanufactured product to improve customer satisfaction and maximise the gained profits for manufacturers.

Two-dimensional warranty policies exist for certain consumer products, such as automobiles. Here, warranty is specified in terms of the time since the sale of the product as well as mileage incurred during that period. Thus, at the time of purchasing the product, the manufacturer may offer a warranty of three years or 30,000 miles, whichever occurs first. Failures in the product within this specified period of time or mileage will be covered by the manufacturer.

In this chapter, we consider the scenario of enterprise warranty programs, where customers are given the option of extending the original warranty. Thus, the buyer could be given an option to purchase a five year—50,000 mile warranty, whichever occurs first. Of course, the buyer will be expected to pay a premium to purchase this extended warranty. Such enterprise warranty programs are also found in other consumer durables, such as refrigerators, washers, dryers, and cooking ranges.

This chapter explores determination of the decision variables, such as product price, warranty time, and usage limit under the original conditions and further, for the enterprise warranty, that is, the extended warranty time and extended usage limit, as well as the premium to be charged to the buyer who selects the extended warranty. Mathematical models are developed based on maximizing the expected unit profit by selecting an enterprise warranty program. Additionally, some other objectives are also considered based on the proportional increase in the expected unit profit due to the increased market share attained through the offering of an enterprise warranty program. Some results are obtained through consideration of various goal values of the chosen objectives.

The purpose of this paper is to address what a sound warranty policy entails by identifying the key variables involved in the development of a warranty program.

The sample population was composed of employees in the US division involved with high‐tech product warranties. A survey questionnaire was used to collect data from the participants.

The paper finds that the formality of the warranty policy should depend on its complexity. Differences exist between types of warranty based on the product knowledge of the buyer. Although a standardized warranty is easy to administer, as the product line diversifies, it becomes more challenging to standardize.

This study can be expanded by examining how companies balance the cost/quality/warranty ability of the product, the techniques used to allocate warranty costs, and to evaluate multiple companies/industries, perhaps with a longitudinal focus.

The formality can be used to communicate the product warranty throughout the organization. Each department has a responsibility to the customer, so team members from service, product development, and marketing should plan and develop the warranty. A standardized warranty can send a clearer message to a customer about a firm's products. Simplifying front and back‐end processing and streamlining support structures can reduce costs.

In this paper, the identified key variable is brought out in warranty management framework. The development of this framework will satisfy a current, critical need to provide guidelines with all the steps needed to develop a warranty policy.

Product failures can lead to customer dissatisfaction, negative brand attitudes and a loss of brand equity. The purpose of this paper is to investigate whether extended warranties offer a mechanism to mitigate the negative effects of product failure and the mediating role of positive and negative self-directed emotions.

The hypotheses are tested using two 2 × 2 between-subjects experiments with product failure and warranty purchase as the two factors, attitude toward the brand as the dependent variable, positive and negative self-directed emotions as mediating variables and attitude toward warranties as a covariate.

It is found that the decline in attitude toward the brand due to product failure is greater among customers purchasing an extended warranty, than among those who do not. Moreover, positive and negative self-directed emotions mediate this relationship.

Manufacturers are for the most part not involved in distribution or administration of extended warranties, which are mainly sold through retailers and administered by companies that specialize in extended warranties. The study findings indicate that contrary to industry practice, consumer-durable manufacturers should consider more active management and promotion of extended warranties to protect their brand’s equity from the negative effects of product failure.