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How Zappos changed customer service

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Imagine a company...

Imagine a company that focused maniacally on customer service.

Imagine a company that is willing to break all the rules to continually surprise and impress their customers.

Imagine a company whose customers are so satisfied with their experience that they passionately tell all their friends.

Imagine a company that makes grown adults feel like little kids on Christmas morning?

If you can imagine that, would it even matter what the company sold?

He just wanted a pair of shoes

How Zappos was born

Back in 1999, Zappos founder Nick Swinmurn was walking around a mall in San Francisco, looking for a pair of shoes. One store had the right style, but not the right color. Another store had the right color, but not the right size. Nick spent the next hour in the mall, walking from store to store, and finally went home empty-handed and frustrated.

At home, Nick tried looking for his shoes online and was again unsuccessful. Although there were a lot of "mom and pop" stores selling shoes online, what was interesting to Nick was that there was no major online retailer that specialized in shoes. So, since it was 1999 and anything seemed possible at the time, Nick decided to quit his day job and start an online shoe retailer... and Zappos.com was born.

The original idea was to create a web site that offered the absolute best selection in shoes in terms of brands, styles, colors, sizes, and widths. Over the past 9 years, the Zappos.com brand has evolved, and in addition to offering the best selection, they strive to be the company that provides the absolute best service online -- not just in shoes, but in any category.

The name Zappos is derived from the Spanish word zapatos, meaning shoes.

How did Zappos change customer service?

They identified and embraced new tactics to build their brand.

Instead of a timeline of Zappos' growth, I want to highlight the core values and process that makes them a remarkable company.

This is best summed up in a blog post by Tony Hsieh, CEO of Zappos, called "Your Culture is Your Brand.". In the next few modules, I will explain, using Tony's words from his post, how Zappos grew from a frustrating trip to a mall to a $840 million dollar company and a

Building a brand today is very different from building a brand 50 years ago. It used to be that a few people got together in a room, decided what the brand positioning was going to be, and then spent a lot of money buying advertising telling people what their brand was. And if you were able to spend enough money, then you were able to build your brand.

It's a very different world today. With the Internet connecting everyone together, companies are becoming more and more transparent whether they like it or not. An unhappy customer or a disgruntled employee can blog about bad experience with a company, and the story can spread like wildfire by email or with tools like Twitter.

The good news is that the reverse is true as well. A great experience with a company can be read by millions of people almost instantaneously as well.

The fundamental problem is that you can't possibly anticipate every possible touchpoint that could influence the perception of your company's brand.

For example, if you happen to meet an employee of Company X at a bar, even if the employee isn't working, how you perceive your interaction with that employee will affect how you perceive Company X, and therefore Company X's brand. It can be a positive influence, or a negative influence. Every employee can affect your company's brand, not just the front line employees that are paid to talk to your customers.

With all due respect to Mars Blackmon, it's not about the shoes.

Zappos has built such a powerful brand, it doesn't matter what they sell.

At Zappos.com, we decided a long time ago that we didn't want our brand to be just about shoes, or clothing, or even online retailing. We decided that we wanted to build our brand to be about the very best customer service and the very best customer experience. We believe that customer service shouldn't be just a department, it should be the entire company.

Advertising can only get your brand so far. If you ask most people what the "brand" of the airline industry as a whole is (not any specific airline, but the entire industry), they will usually say something about bad customer service or bad customer experience. If you ask people what their perception of the US auto industry is today, chances are the responses you get won't be in line with what the automakers project in their advertising.

So what's a company to do if you can't just buy your way into building the brand you want? What's the best way to build a brand for the long term?

In a word: culture.

At Zappos, our belief is that if you get the culture right, most of the other stuff -- like great customer service, or building a great long-term brand, or passionate employees and customers -- will happen naturally on its own.

We believe that your company's culture and your company's brand are really just two sides of the same coin. The brand may lag the culture at first, but eventually it will catch up.

Your culture is your brand.

At Zappos, our belief is that if you get the culture right, most of the other stuff -- like great customer service, or building a great long-term brand, or passionate employees and customers -- will happen naturally on its own.

We believe that your company's culture and your company's brand are really just two sides of the same coin. The brand may lag the culture at first, but eventually it will catch up.

Zappos will give you $2,000 to quit

A look inside Zappos' innovative hiring and training program

Your culture is your brand.

So how do you build and maintain the culture that you want?

It starts with the hiring process. At Zappos, we actually do two different sets of interviews. The hiring manager and his/her team will do the standard set of interviews looking for relevant experience, technical ability, fit within the team, etc. But then our HR department does a separate set of interviews, looking purely for culture fit. Candidates have to pass both sets of interviews in order to be hired.

We've actually said no to a lot of very talented people that we know can make an immediate impact on our top or bottom line. But because we felt they weren't culture fits, we were willing to sacrifice the short term benefits in order to protect our culture (and therefore our brand) for the long term.

After hiring, the next step to building the culture is training. Everyone that is hired into our headquarters goes through the same training that our Customer Loyalty Team (call center) reps go through, regardless of department or title. You might be an accountant, or a lawyer, or a software developer -- you go through the exact same training program.

It's a 4-week training program, in which we go over company history, the importance of customer service, the long term vision of the company, our philosophy about company culture -- and then you're actually on the phone for 2 weeks, taking calls from customers. Again, this goes back to our belief that customer service shouldn't just be a department, it should be the entire company.

At the end of the first week of training, we make an offer to the entire class. We offer everyone $2000 to quit (in addition to paying them for the time they've already worked), and it's a standing offer until the end of the fourth week of training. We want to make sure that employees are here for more than just a paycheck. We want employees that believe in our long term vision and want to be a part of our culture. As it turns out, on average, less than 1% of people end up taking the offer.

WOW and Weirdness as Core Values

If you get the culture right, the brand will build building will fall into place on its own.

One of the great advantages of focusing on culture is when reporters come and visit our offices. Unlike most companies, we don't give reporters a small list of people they're allowed to talk to. Instead, we encourage them to wander around and talk to whoever they want. It's our way of being as transparent as possible, which is part of our culture.

We've formally defined our the Zappos culture in terms of 10 core values:

1) Deliver WOW Through Service
2) Embrace and Drive Change
3) Create Fun and A Little Weirdness
4) Be Adventurous, Creative, and Open-Minded
5) Pursue Growth and Learning
6) Build Open and Honest Relationships With Communication
7) Build a Positive Team and Family Spirit
8) Do More With Less
9) Be Passionate and Determined
10) Be Humble

Many companies have core values, but they don't really commit to them. They usually sound more like something you'd read in a press release. Maybe you learn about them on day 1 of orientation, but after that it's just a meaningless plaque on the wall of the lobby.

We believe that it's really important to come up with core values that you can commit to. And by commit, we mean that you're willing to hire and fire based on them. If you're willing to do that, then you're well on your way to building a company culture that is in line with the brand you want to build. You can let all of your employees be your brand ambassadors, not just the marketing or PR department. And they can be brand ambassadors both inside and outside the office.

At the end of the day, just remember that if you get the culture right, most of the other stuff -- including building a great brand -- will fall into place on its own.

The human touch

Grandmas die everyday. Customer service like this doesn't.

This is one of many such stories about this amazing company and the business magazines are listening. Below are many links to stories, articles and glowing reviews of this amazing company.

From a blog post at
http://www.zazlamarr.com/blog/?p=240

I heart Zappos.

I really do.

One bright, extraordinary note in all of the sad stuff of the last few weeks - in May we had ordered several pairs of shoes from Zappos for my mom. She'd lost a lot of weight, and her old shoes were all too big. She had a whole new wardrobe of clothes in pretty colors, that fit, so I wanted her to have some pretty shoes that fit, too, when I took her up to Oregon to stay where her sister is. Out of seven pairs, only two fit. Not bad considering she'd never been this thin, so I was winging it, and the return shipping is free.

The rest were here waiting to be returned. Because of various circumstances - lost label, my mom being hospitalized and me being away, the shoes were never sent back. There's a time limit on the return of 15 days. Remember this. When you do a return to them, they pay the shipping, but you have to get the shoes to UPS yourself. Remember this, also.

When I came home this last time, I had an email from Zappos asking about the shoes, since they hadn't received them. I was just back and not ready to deal with that, so I replied that my mom had died but that I'd send the shoes as soon as I could. They emailed back that they had arranged with UPS to pick up the shoes, so I wouldn't have to take the time to do it myself. I was so touched. That's going against corporate policy.

Yesterday, when I came home from town, a florist delivery man was just leaving. It was a beautiful arrangement in a basket with white lilies and roses and carnations. Big and lush and fragrant. I opened the card, and it was from Zappos. I burst into tears. I'm a sucker for kindness, and if that isn't one of the nicest things I've ever had happen to me, I don't know what is.

IF YOU BUY SHOES ONLINE, GET THEM FROM ZAPPOS.

With hearts like theirs, you know they're good to do business with.

The business world is listening. More Zappos stories and accolades below...
Zappos on Startup Review
Zappos.com Case Study: Why shoes are great for e-commerce %u2026 yes, really
Inc.com article on Tony Hsieh
How I Did It: Tony Hsieh, CEO, Zappos.com
Startup Nation on Zappos
Focusing on Service - Nick Swinmurn's Key Move
Business Week article on Zappos
A Shine On Their Shoes
Zappos.com's blue-ribbon customer service is winning market share
Fast Company article on Zappos
Power to the employee. At Zappos, workers are given power to improve the company.
More accolades from Fast Company
Zappos and Personal Branding

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    davespeed Dec 11, 2011 @ 5:35 pm | delete
    Nice lens. I am about halfway through Tony Hsieh's book Delivering Happiness about how he and his team created the Purple Cow known as Zappos. It is an inspiring tale. In your lens, I was paticulaly struck by the story about Zappos sending the flowers. Truly remarkable. Thanks for sharing this lens with us.
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hebert33

Taking a leave of absence from the real world to work with Seth Godin and nine other amazing people for six months in NY.

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