Monday, June 22, 2009

Zappos map to success

You will rarely hear Tony Hsieh speak, because he's apparently very shy. His company Zappos, an online shoe retailer that is as famous for its amazing shoe lineup as it is for its outstanding customer service, has been getting increasing attention for its incredible growth over the past couple of years. Their customer service has been largely credited for its sales growth and strong customer loyalty (I have friends who will buy ONLY from zappos, even if it is more expensive!).

In his recent SXSW speech, Hsieh revealed the cornerstones of his company's model for marketing (I have previously blogged about Zappos and their amazing model here):

1. Market through your customers; harness the power of word-of-mouth: Zappos takes most of their marketing budget and puts it into enhancing their customer service. This creates happy customers who spread the Zappos gospel through word-of-mouth. Not only that, but 75% of their customers are repeat customers; essentially they have STRONG customer loyalty.
2. Make your contact information obviously and easily available: The first thing you notice about Zappos (other than the shoes) is their toll-free customer hotline. There is no need to dig. Its just right there to use, and boy do customers use it!

3. Use the telephone: It is still the most universally accessible technology. It also requires one-on-one communication, thereby enhancing the customer's experience.

4. Focus on building relationships. Give good customer service at all costs. For eg. if zappos is out of a certain shoe or shoe size, customer reps are trained to find a competitor who might have it and direct the customer there. While they lose business in the short term, they have gained the trust and loyalty of the customer in the longterm.

5. Train your service team to imbibe and imbue the core philosophy: Everyone who works at Zappos is aware that the bottom line is building relationships with the customer.
6. Reward loyalty: Loyal customers are often suddenly surprised with upgrades. Customers are rewarded in their shipping cycles.

7. Realtime Tracking: Zappos shows only the items that are stocked. This shows a level of respect and honesty that customers greatly appreciate. This also enhances loyalty.
8. Make maintaining your company culture the absolute bottom line: Zappos has a hard rule about barring anyone who doesn't pass their culture-fit interviews from working at the organization. Further, they offer financial incentives to employees to leave if they don't feel a fit. This decision is left to the employees to take at any point.

9. Give your employees an outlet to express their individuality and opinions: Zappos puts out a company culture magazine every year. It contains unedited pieces of work submitted by every employee, largely focusing on their thoughts about working at Zappos. Employees are also encouraged to communicate amongst each other frequently on mediums such as twitter.

10. Chase the Vision, not the money. As they are walking examples, Zappos believes in following the vision. The money and the business will follow automatically.


Brooklyn said...

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pragzz said...

Thanks Brooklyn! Please continue to give me always looking to improve my work.