We’ve all been there: Just when you think you have a client on the hook, their hesitation starts to build. This is different from the common brush-offs like “I’ll need to ask my spouse.” or “I don’t have time to talk right now.”
We’re talking about those genuine moments of interest where subtle prodding can close the sale.
And that’s where using FOMO can become your secret weapon.
What Is FOMO?
The Fear of Missing Out: either in terms of savings, an experience or peace of mind. It’s also an effective psychological tactic that drives 60% of consumers to make a purchase.
Extended warranties speak to the “Fear” of something breaking without the budget to repair. But what about the “Of Missing Out” part?
Let’s cover some of the (ethical) ways to use FOMO in your extended warranty sales process.
Why Urgency (or Missing Out) Matters in Warranty Sales
Consumers often view a warranty as a want, if anything — but rarely a need. And extended warranties are one of those “I’ll get around to that one day” types of purchases. The longer a decision lingers, the more likely that day will never come… unless you use FOMO to open that crucial Point-of-Sale Window a little wider.
Emphasize the Cost of Delay
Things don’t last as long as they used to (thanks, planned obsolescence!). And your prospect probably has one or five things on the brink of needing repair. Just look at the life expectancy of everyday items:
- Water heaters: 12 years
- HVAC units: 15 years (if you’re lucky)
- Fridges: ~10 years
And those repairs will only get more expensive because of a little thing called inflation.
Here’s where you can help clients overcome decision fatigue by simply saying “You can get peace of mind, starting today. Our policy means you’ll have one less thing to worry about.”
What Are Some Other Ethical FOMO Ways to Boost Warranty Conversions?
Tactic 1: Time-Limited Offers & Savings
Ever wonder why e-commerce sites have those countdown timers during sales? Those timers are the most direct example of FOMO in action. They reinforce those lower prices have a shrinking-by-the-second shelf life — and they’re incredibly effective during that Point-of-Sale Window when a “yes or no” decision must be made.
It makes sense to use this point-of-sale warranty tactic when you can tell the client needs a little nudge to say yes while subtly mentioning that the same offer may not be available at a later date.
Tactic 2: Renewal Reminders & Rate Locks
You know it’s much easier (and cheaper) to keep a customer than acquire one. So, why not use FOMO as part of your warranty renewal strategy?
Send emails with language like “Your service contract is expiring soon! Renew now to keep your coverage and lock in your rate to avoid premium increases.”
Something this simple does two things:
- It creates a subtle sense of urgency
- It explains the benefits of renewing
Tactic 3: Tiered Options & Scarcity
Odds are you offer “good,” “Better,” and “Best” tiers of coverage. At the same time, odds are you’re missing an opportunity to leverage Prospect Theory as part of your pitch.
Put simply, Prospect Theory states human nature is such that we’d much prefer to avoid a loss than experience a gain. So, how can you use this type of FOMO as part of your extended warranty techniques?
Let’s take those inevitably faulty fridges we mentioned earlier as an example.
You could point out that your “Better” plan covers mechanical parts like the compressor with coverage that begins in a couple of weeks. But your “Best” plan also covers the electronic components like the touch screen and control board (which have a funny way of acting up after the manufacturer warranty expires) — with coverage starting on day one.
Balancing Facts With FOMO
Let’s face it: most of us are skeptics at heart. A mere 3% of consumers trust salespeople. The good news is 88% of leads will buy if they view their salesperson as a trusted advisor — but you won’t be trusted if you’re using every scare tactic in the book.
Do:
- Be transparent about offer deadlines
- Clearly state risks and benefits
- Focus on your leads’ needs
Don’t:
- Create false scarcity
- Mislead customers
- Use high-pressure boiler room negotiations
Inline CRM Streamlines Your Urgency-Enabling Process
Keeping on top of those time-sensitive offers and renewal reminders requires organization. A lot of organization.
Inline CRM gives you the power to:
- Test and tinker with your sales scripts to see which FOMO tactic works best
- Segment customers for targeted offers
- Track deadlines
- Automate renewal notice emails
Now, some companies might use false FOMO and would end this blog by saying you only have until the end of the week to try their system — not us.
Just reach out and we’ll give you the keys for a no-pressure, 30-day test drive. For free.
Because you’re more likely to see success when you’re being helpful — not causing unnecessary urgency.
