Every year, telcos are accruing unnecessary losses to a problem that’s both common and preventable: warranty claims that are fault found (NFF) or no trouble found (NTF). These are defined as cases where a customer believes their mobile device is faulty only for it to be discovered that the device is actually not defective.

According to MCE’s internal data, on average, 40 percent of warranty claims fall into this category. If we take into account the average cost of a smartphone ($220), frequency of NFF cases and the fact that original equipment manufacturers (OEMs) don’t reimburse NFF warranty claims, telcos are losing millions.

In the warranty process, telcos are trying to strike a balance between pleasing the customer, servicing the customer quickly and ensuring the mobile device is truly eligible for a warranty claim. However, a predominant reason for the high number of approved warranty claims that are NFF is the inability of the telco to acquire intelligence on the mobile device in question, which is critical to making the right decision at that point in time.

Without the proper digital toolbox at their disposal to collect sufficient device intelligence and assess the device thoroughly, the process is relegated to manual, subjective assessments of the frontline representative in retail or the customer at home to approve or decline warranty claims. As a result, the inability to gather device intelligence in a standardized and truly determine if a mobile device is eligible for warranty is left to the OEMs downstream.

In operating in this manual and subjective process, telcos are both taking on financial risk for the organization and risking lower NPS. Resultantly, they face three negative impacts:

  • Inflated costs and financial risk: Unverified claim approvals lead to high costs associated with sending hundreds of thousands of mobile devices back to the OEM for a warranty claim that will ultimately not be reimbursed by the OEM.
  • Customer dissatisfaction: The customer experiences a delayed resolution which could have been resolved upfront had the frontline representative or customer understood that the device is actually fully functional and its fault misperceived. With delayed resolution and unstandardized, manual processes, customer dissatisfaction ensues and trust in the brand degrades.
  • Labor inefficiency: Frontline representatives are spending more time with manual evaluations that take up time servicing a customer rather than focusing on selling to other customers who offer revenue opportunities.

By equipping frontline staff in retail and customers on the telco mobile app with the digital tools to acquire device intelligence and troubleshoot the mobile device issues upfront, telcos can standardize and streamline warranty exchange claim confirmation processes. This puts the power of device intelligence and smart decision-making into the telco’s hands rather than leaving it up to the OEMs and ultimately leads to:

  • Reduced costs: Standardized and digitized evaluation processes underpinned by device intelligence gathering means fewer invalid or NFF warranty claims and leads to significant cost savings in the millions of dollars range.
  • Strengthened brand loyalty: Digital tools and standards create process enforcement, precision and faster resolution, leading to increase in customer trust in the brand and satisfaction with the device troubleshoot experience.
  • Labor efficiency: Frontline representatives spend less time evaluating a device and processing a claim unnecessarily and more time focused on selling to other customers who offer new revenue opportunities for the telco.

Mobile operators don’t have to accept the high costs of NFF claims as standard practice. By investing in the tools to acquire intelligence both in retail and remotely at the point of claim, they can make warranty programs more cost-effective while improving the overall experience for customers.

MCE’s digital toolbox standardizes mobile devices evaluation across the different customer engagement channels – in retail and on-device – enabling frontline representatives and customers to accurately troubleshoot mobile devices and avoid pains associated with manual evaluation. Empowered by MCE’s dDLM platform technology to connect channels and digitize processes, telcos can refine their warranty exchange process and drive the outcomes they desire.