Brands: Zappos Brand Based on Great Service Not Lip Service

May 27, 2008 by anne

Are you tired of companies who prattle about good service as if saying it is the same as delivering it? Here’s an online retail brand built on great service, not lip service.

Zappos.com was founded in 1999 by twenty something entrepreneurs Nick Swinmurn and Tony Hsieh, founder of LinkExchange.

In addition to a gargantuan selection (3 million shoes, handbags, clothing items and accessories from over 1,100 brands) Zappos.com offers free shipping and a 365 day return policy.

From the beginning, the founders wanted the Zappos brand to be a “service company that happens to sell shoes.” 

Providing great service requires a customer-focused culture. So all new hires at Zappos.com Las Vegas headquarters, "including accountants, lawyers and software developers," are required to go through Customer Loyalty training.

After a week, trainees are offered a $1000 bonus to quit, plus their salary. Why? To weed out the ‘wrong’ people. “If you want to create a memorable company, you have to fill your company with memorable people, says a Harvard Business article.

The 1500 employee company expects $1 billion in 2008 sales, primarily through repeat business and word-of-mouth. Hsieh says the company" will continue to build our brand and our culture, because in the long run, brand and culture are the same thing.” (Speaking of culture, when was the last time you read about a CEO forgoing his bonus to provide bigger employee bonuses?)

Zappos’ success demonstrates some of the key characteristics of a strong brand: Leadership’s passion for the brand, an unwavering focus on delivering the brand, and a culture that reinforces each employee's responsibility for the brand.

That isn’t to say that the road to success hasn’t had its speed bumps. The company’s recent decision to discontinue their price protection policy prompted customers to post a few dozen complaints, such as the one below, on CEO Hsieh’s blog:

“…For me, the price matching was critical for shopping at Zappos. I find Zappos to charge full retail or even more than full retail for the shoes I've looked at, probably to cover for the "free" shipping. I was happy to give Zappos my business when they could give me a good price, but since the elimination of price matching, I won't be shopping at Zappos anymore.”

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