Porch Pirate, Product Safety Is a Win-Win for Sellers, Customers

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The upcoming vacation season entails an estimated 850-950 million shipped packages that should survive journey delays, misrouting, theft in transit, and porch piracy after supply. Until shoppers buy from main e-commerce giants, delivery safety is both non-existent or fairly expensive.

Thieves stole an estimated 260 million packages, price about $19.5 billion, from U.S. shoppers’ porches, doorways, and mailrooms in 2022.

Retail guarantee supplier Prolong now presents SMB e-tailers and their clients a alternative of each low-cost prolonged product warranties and delivery safety at checkout.

The protection protects the retailer and generates further income, successfully offering retailers with two gross sales alternatives as a substitute of only one. If the product is stolen, Prolong pays to purchase a alternative from the identical retailer.

Extend shipping protection on Anne Klein e-commerce checkout page

Prolong’s pricing components provides retailers an additional income stream from each checkout purchases of guarantee and delivery protection, even when shoppers by no means need to file a declare.

Rohan Shah, co-founder and chief income officer of Prolong, says its product safety plan provides retailers and shoppers a substitute for cumbersome legacy claim-filing methods.

Extend product protection offer

“The largest ache level that retailers’ assist groups have is that 40% to 70% of all name quantity to their name facilities is round delivery points. ‘The place’s my order?’ or ‘My package deal didn’t arrive.’ or ‘My product arrived broken,’” he advised The E-Commerce Occasions about typical criticism calls.

Supply points plague retailers when it comes to assist prices. If a buyer calls a couple of stolen package deal, most retailers ship a brand new one. That units the service provider right into a damaging financial transaction with clients, hoping they are going to come again and purchase once more, famous Shah.

“These points have been hitting the retailers. From a buyer perspective, the service provider delivered nervousness,” he stated. “We constructed one other providing round delivery safety to complement our guarantee plans to cowl towards misplaced, stolen, and broken packages, thus guaranteeing peace of thoughts to clients.”

Leveling the Supply Subject

When formulating their enterprise technique in 2019, Prolong’s founders studied buyer reactions to the issues usually related to guarantee protections. They discovered that except it was a simple transaction constructed into the sale, shoppers tended to not purchase guarantee extensions.

Prolong reassessed the necessity for delivery safety final yr and added that program.

Rohan Shah, 
Co-founder of product protection solutions firm Extend

Rohan Shah
Co-founder of Prolong

Shah notes that whereas giant e-commerce platforms corresponding to BestBuy and Amazon effortlessly combine prolonged guarantee choices at checkout, small and medium-sized enterprise (SMB) retailers regularly lack the infrastructure to manage these providers independently.

As an illustration, Finest Purchase has constructed out all the know-how and infrastructure itself to supply these applications to clients. Most retailers can’t try this. It will take them two years to try to construct all of that out, and it might by no means get into their roadmap,” stated Shah.

BestBuy does 52% of its web revenue on prolonged warranties. That’s the reason they’re so pushy, he added bluntly.

But, once we walked by the shop, not one of many manufacturers had an prolonged guarantee on their web site. So, there’s buyer demand,” he noticed.

A considerable monetary alternative offered itself to Prolong’s founders, but entry was nonexistent. This case highlighted a damaged buyer expertise and indicated a distribution challenge for such providers inside the business.

“That could be a ache level that exists within the retail business, which is the chance for us to come back in and actually change how folks have a look at that. So that’s what bought us set onto this concept,” Shah revealed.

Fixing E-Commerce Ache Creators

Retailers couldn’t get entry to those choices except they have been one of many prime 1% distributing by Amazon, Costco, Wayfair, Walmart, or Finest Purchase. Each a type of retailers presents prolonged warranties on each product they will.

That was the disconnect that Prolong recognized and got down to remedy.

Quick ahead to at the moment. The corporate is absolutely technology-enabled. It additionally has full vertical integration.


Shah sees Prolong functioning as a software-as-service (SaaS) enterprise. The corporate constructed out the unique prolonged guarantee service and owns all the infrastructure from an underwriting and insurance coverage perspective.

“We imagine that’s desk stakes to be able to management buyer expertise in addition to the service provider expertise from finish to finish,” he defined.

Prolong began as a web-based firm specializing in Shopify, Magento, BigCommerce, and Salesforce for e-commerce retailers.

“We’re reside in over 7,000 brick-and-mortar places throughout the USA and Canada at the moment. We provide plans for various classes corresponding to furnishings, jewellery, electronics, sports activities, health, and auto components,” he provided.

Making Supply Ensures Work

Prolong’s buyer product insurance coverage providing drives up conversion, buyer confidence, and peace of thoughts on the level of sale. It additionally removes all the legal responsibility and merchandise from these retailers’ books on the again finish, based on Shah.

Prospects with a product supply challenge contact Prolong on to deal with claims by the chatbot, simply as the corporate does for its prolonged guarantee service. The corporate replaces these clients’ merchandise for them.

“We purchase again further merchandise from the retailer and get them despatched out to the client, which creates what we have a look at historically as a transactional revenue software. It turns the state of affairs right into a loyalty and buyer lifetime worth software,” asserted Shah.

This strategy leads to a 100% margin product that flows straight to retailers’ backside line. Prolong assumes the chance and fulfills the efficiency obligations, with all prices accounted for within the course of.

Inexpensive Guarantee Add-Ons for E-Commerce

Retailers pay nothing upfront to make the most of Prolong’s product safety plan. Customers don’t have to hitch any program to take part in what, for them, is basically a supply assure. No month-to-month or annual charges accrue as they do for related providers conventional SAS suppliers cost.

The price of conventional prolonged warranties from many large field retailers runs a number of hundred {dollars} for one or two years of additional safety past the producer’s primary 90 days to one-year restricted providing. The service provider should normally arrange the back-office mechanisms and handle the prices as a enterprise expense.

With Prolong, shoppers pay as little as 5% of the retail value. The price can go as much as 15% or 20%, relying on the protection time period size.

Maximizing E-Tail Margins With Guarantee Companies

Prolong’s marketing strategy relies on retail margins. Shah provided this instance:

A shopper takes an prolonged guarantee on a $100 buy. A portion of that — say 50% — is the retailer’s margin. That’s $50 of pure margin income the retailer is capturing. Usually, most retailers function on a 20% margin or larger, relying on the product class.


For SMBs, establishing and managing prolonged warranties could be time-consuming and dear. Shah famous that insurance coverage plan suppliers sometimes don’t help with the setup course of. Because of this, providing prolonged warranties by e-commerce purchases is commonly not viable for a lot of small retailers with their very own web sites.

“That’s what we do out of the field for retailers,” stated Shah. Prolong places a portion of its share of the prolonged guarantee charge right into a declare reserve. That’s the precise claims and underwriting element of the enterprise. The corporate takes its margin on prime of that, he defined.

Why Transport Safety Works for Shops and Customers

Prolong works with its associate retailers to obtain a fraction of every transaction when the patron elects to take part within the delivery safety. The shared income relies on the common order worth (AOV), the common quantity the client spends on every buy.

Shah provided this instance: Say the purchaser has an AOV of $100. Transport safety prices from $1.99 to 2% of the cart whole. Every shopper decides at checkout to just accept or decline the delivery safety.

“That could be a actually low charge construction for the e-commerce shopper. In-store delivery safety isn’t related. For on-line procuring, it is rather related,” Shah noticed.

Efficient Income Technique

Product prolonged warranties are money-makers for in-store retailers. In response to Shah, almost half of all clients purchase it. Not so with on-line purchases. Solely about 15% of e-buyers choose in. With delivery safety, the buy-in possibility for internet buyers goes as much as 70%.

“During the last two years, our product safety gross sales went from a nice-to-have incremental software to a must have possibility for a lot of retailers’ profitability stability sheet,” Shah stated.

The delivery safety market is rising as a result of it presents e-commerce retailers an efficient solution to struggle again towards deliveries gone astray at checkout.

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