L.L. Bean made some pretty big news when they announced that they were ending their lifetime warranty on their products. This was a cornerstone of their customer experience since they started and I would guess a driver of why people shopped at Bean. It also spoke of why retail needs to be a relationship between the stores and the customers. Both sides have an obligation to be respectful of each other and when it gets out of balance, things like this happen. I would certainly be interested in knowing how much they were losing on these returns, but let's give them the benefit of the doubt that it was having a real impact on their bottom line.
But, rather than just eliminate the lifetime warranty, I think they had a chance to make a different play and maybe even generate some additional revenue to boot. They could've used this as a chance to create a new loyalty program for both one-time and regular shoppers, keeping this important point of differentiation alive, while making sure that it would be very hard for people to game the system.
Here's what I might suggest:
- For single items, they could charge a sliding fee based on the purchase price.
- For people who shop regularly, they could pay a yearly membership in order to keep the lifetime warranty.
- They could also waive the fee for people who shop above a certain spending amount.
I think that L.L. Bean could've really done better here and not just cut the warranty. Even when making choices to eliminate long-standing services, companies should use some creativity and think of how both they and consumers can benefit from the changes. Fortunately, L.L. Bean has a long history of doing right by their customers so it is unlikely that this will have a big impact on their sales. But not every brand has that equity to play with.
Companies should have an obligation to put their customers front & center in their decision process. Customer know that many times, that doesn't happen, hence the lack of brand loyalty we see today. We're very brand promiscuous today. On the other side, customers have an obligation not to abuse the system as well. If they do, then they force companies to make changes like this. When both sides work together, then both sides win.
Here's the letter that was posted to the L.L. Bean Facebook page:
A Letter to Our Customers,
Since 1912, our mission has been to sell high-quality products that inspire and enable people to enjoy the outdoors. Our commitment to customer service has earned us your trust and respect, as has our guarantee, which ensures that we stand behind everything we sell.
Increasingly, a small, but growing number of customers has been interpreting our guarantee well beyond its original intent. Some view it as a lifetime product replacement program, expecting refunds for heavily worn products used over many years. Others seek refunds for products that have been purchased through third parties, such as at yard sales. (Emphasis mine)
Based on these experiences, we have updated our policy. Customers will have one year after purchasing an item to return it, accompanied by proof of purchase. After one year, we will work with our customers to reach a fair solution if a product is defective in any way.
This update adds clarity to our policy and will only affect a small percentage of returns. It will also ensure we can continue to honor one of the best guarantees in retail, with no impact for the vast majority of our customers. To learn more, please view our full return policy at llbean.com.
L.L.Bean has stood for quality, service, trust, and getting people outdoors ever since my great-grandfather founded our company over 100 years ago - and that will never change. Thank you for being a loyal customer and we look forward to continuing to inspire and enable you to Be an Outsider.
Shawn O. Gorman
L.L.Bean Executive Chairman