Extended Warranties: Consumer and Manufacturer Perceptions

• Published in: The Journal of consumer affairs Vol. 25; no. 1; pp. 68 - 83
• Main Authors: KELLEY, CRAIG A., CONANT, JEFFREY S.
• Format: Journal Article
• Language: English
• Published: Oxford, UK Blackwell Publishing Ltd 01.06.1991; University of Wisconsin Press; Blackwell Publishers Ltd
• Subjects: Attitudes; Beliefs, opinions and attitudes; Consumer attitudes; Consumer behavior; Consumer goods industries; Consumer research; Consumers; Customers; Express warranties; Extended warranties; Financial risk; Household appliances; Management; Manufacturers; Manufacturing industries; Manufacturing industry; Marketing; Questionnaires; Revenue; Social policy; Studies; United States; Variance analysis; Warranties; Warranty
• ISSN: 0022-0078; 1745-6606
• DOI: 10.1111/j.1745-6606.1991.tb00281.x

Extended warranties are becoming increasingly popular, both among consumers and manufacturers. In this study, consumer and manufacturer perceptions of why extended warranties are bought and sold are evaluated and compared. The results indicate that consumers seem to view extended warranties as a way of reducing perceived risk. Manufacturers reveal that they market extended warranties both to generate revenue and to provide service to customers. Marketing management and public policy implications are examined and research directions identified.