By Pramod Thomas
The US-based The Warranty Group (TWG) is one of the world’s premier providers of warranty solutions and related benefits, with operations in more than 50 countries. It made its foray into India in 2014 to address opportunities for service solutions around business intelligence, customer loyalty, warranty management including sales, case management, compliance, and marketing services in a JV with TVS Automobile Solutions Limited (TVS ASL).
The Group had recently increased its stake in the joint venture, from 49 percent to 90 percent, with TVS a minority shareholder. This was a strategic decision to expand our footprint in the auto and non-auto segments in India, Vivek Burman, Country Head for India, The Warranty Group told AutoParts Asia. Full text of the interview:
Give a brief profile about The Warranty Group with an overview of the product range.
TWG has a robust presence in more than 50 countries across the globe. The company offers a wide range of service contracts and solutions, extended warranties, limited warranties, prepaid maintenance programs, and related products and services to the leading manufacturers, distributors, and retailers of consumer goods, including automobiles, homes, consumer appliances, electronics, and furniture, as well as specialty insurance products and services for financial institutions.
No matter how reliable modern products and gadgets are, replacement or refurbishing of damaged parts is an expensive option. Customised solutions provided by TWG work like a safeguard to secure products against expensive and unforeseen repairs.
Our goal is to provide unique solutions that create value for both our clients and the end-consumer. For clients we partner with, we can help them acquire new customers, strengthen existing relationships, and improve the overall brand experience, thereby positively impacting their bottom lines. We are focused on working with our clients to provide the right products that are customized for them, and which promote convenience and brand loyalty.
What role does The Warranty Group play in the automotive space in the country?
The company concentrated on the Indian market with a focus on the automotive passenger car segment (including minivans, SUVs, and light trucks), the two-wheelers segment (motorcycles and scooters) and the light commercial vehicles as well as the non-automotive consumer segments of appliance and technology. Products offered by TWG include a full range of service contracts and solutions around extended warranties, limited warranties, prepaid maintenance programs, and related products and services. TWG currently works with several Indian and Global Manufacturers to provide a bouquet of warranties and allied programs to enhance the service delivery to the customers.
Could you throw some light on the joint venture between The Warranty Group and the TVS Group in India? What is the significance of this collaboration?
We have increased our stake in the joint venture, from 49 percent to 90 percent, with TVS a minority shareholder. This was a strategic decision to expand our footprint in the auto and non-auto segments in India. Through this JV, TWG would continue to offer extended warranties and related service solutions for passenger cars, commercial vehicles and off-road farm equipment in the Indian market.
Tapping into the after sales car service market in India that currently stands at around USD 10 Billion, we are forging a partnership with B2B clients to help them retain and acquire new customers in their area of operations, thereby improving customer loyalty, and growing their bottom line. Going forward, our focus would be on the manufacturers, retail segments such as auto dealerships, electronic retailers, online sellers, and financial institutions.
What are the new initiatives/products of the Warranty Group in the extended warranty and after-sales service market?
India presents tremendous opportunities, buoyed by consumption trends and increasing customer expectations. Consumer behaviours and spending patterns are shifting as income rises and the mindset of the customer evolves. These shifts have big implications for how companies position themselves now. Consumers are demanding more, are discerning with high expectations from brands and the experience they provide.
We manage the whole end-to-end client experience – from customising products and solutions to handling the after-sales process. We use data in the way we talk to clients, in understanding the risk profile of our business, and in dealing with all commercial and underwriting aspects. Data helps us understand the various underlying developments of claims — critical to the program’s loss ratio calculations — and to come up with products based on customer requirements.
Are you eyeing any other joint ventures/associations in the automotive space in India?
India is a significant market with a lot of potentials, and we are looking forward to growing our customer and partner relationships within the country.
What are the expansion plans of the group in India? Which are the new products in the pipeline?
India is a key market for TWG, and we will continue to invest in this market – as with acquiring a majority stake in the JV.
In India, we will continue offer brand-adjusted customer experience based on business intelligence and data analytics. Our operating model focuses on industry-leading companies seeking to innovate with new products and services, improve existing products and services and navigate risk transfer and compliance issues. These are built on our expertise as a service provider and the customised solutions created by us to help them acquire new customers, improve customer loyalty, and grow their bottom lines.
What are the new challenges in the automotive space in the country? Do you have any suggestions to overcome these challenges?
While investing in a product, say an automobile, the consumer never thinks twice before buying a motor insurance as it is mandatory (Third Party Cover) and assumes that since motor insurance is in place, there is no need for purchasing an extended warranty. However, Motor Insurance and Extended Warranty offer different types of customer protection and coverage, although they might have some minor overlap, and it is critical to educate the consumer on the same.
The automotive space is rapidly turning to innovative solutions for passenger and utility vehicles that are fitted with expensive technology and equipment. When such systems fail, mere repair work is not the answer, and the parts may require replacement, thereby providing an economical solution to consumers. The plain fact is — no matter how reliable modern products and gadgets are, replacement or refurbishing of damaged parts is an expensive option. Customised solutions provided by TWG work like a safeguard to secure products against expensive and unforeseen repairs.
This sector has traditionally also not used data for decision making, and that is a huge differentiator we bring to the table. Data is the way forward, and in India, we offer brand-adjusted customer experience based on business intelligence and data analytics. By aggregating the diverse data from clients and markets, we derive better insights and build deeper engagement with our customers, by helping them to generate insights to realise greater data-driven responsiveness, and deepen relationships with their consumers.
To sum it up, India presents tremendous opportunities, buoyed by consumption trends and increasing customer expectations. Consumer behaviors and spending patterns are shifting as income rises and the mindset of the customer evolves. These shifts have big implications for how companies position themselves now. Consumers are demanding more, are discerning with high expectations from brands and the experience they provide. After sales is the most important part of the product ownership experience in terms of maintaining brand loyalty and is an important market to cater. India is an important market for us, with exciting opportunities in the Extended Warranty and After Sales services market, we are looking to intensify and aggressively expand our presence in the country.