Last week at the TED conference, Seesmic founder Loic Le Meur held an informal interview with Zappos CEO Tony Hsieh (pronounced Shay), whisking him away to a bathroom to learn more about this forward thinking company and the man social media experts are calling the master of customer experience.
We’ve embedded the video at the end of this post, but these are a few of the highlights.
According to Hsieh, the ultimate aim of the Zappos brand is to be the very best when it comes to customer service and consumer experience. “Our hope is in 10 years people won’t even realize we started out selling shoes online,” he explains, “we sell clothing and handbags, accessories – even electronics and house wares.” He also points out that it doesn’t necessarily need to be online. “20 – 30 years from now, I wouldn’t rule out Zappos Airlines,” he said.
Great customer service is not something offered by the majority of companies and Hsieh suspects a lot of people are frustrated by this. “In the long run, customer service is just good business,” he says. “The problem, however, is that the payoff is usually two or three years down the line.”
Given the company made over a billion dollars in gross merchandise sales in 2008 after starting with almost nothing in 1999, and that repeat customers and word of mouth were the main drivers of that growth, we can see how many businesses are trying to model themselves on the force that is Zappos.
So what is different about Zappos?
- The company provides free shipping both ways
- Zappos has a 365 day return policy
- Only products available in the warehouse are placed on the site
- The warehouse is open 24 hours a day
- The company is contactable 24 hours a day, 7 days a week
- The 1800 contact number is prominently placed on every page of the site
- The company trusts in its reps; sales staff don’t have scripts
- If products are unavailable, sales staff direct customers to competitors
While some of these ideas are extraordinary, like the 365 day return policy, others are quite easy to implement – putting your telephone number on every page of your Website. Clearly this is only a sampling of the alternative methods implemented by the company and some of them are certainly not efficient to the company’s bottom line, but Hsieh firmly believes creating a ‘wow’ experience for the customer and investing in a corporate culture that allows employees freedom and space is the essence of what makes Zappos so successful.
“If you get the culture right, then most of the other stuff, like great customer service or building a brand will just happen naturally.” Hsieh says.
While the company has formalized the definition of its culture into ten core values and people are hired and fired based on those values, Hsieh believes the company culture is different because it is not driven by him, but the employees who themselves determine how they want the culture to evolve.
“We’ve actually passed on a lot of really talented people that we know would make an impact to our top or bottom line,” says Hsieh, “but if you know they’re not a culture fit we won’t hire them. Similarly, he explains the company will fire people even if they’re doing their job perfectly if they’re bad for the culture.
The Culture Book, a book Zappos puts out every year, consists of thoughts from all Zappos employees about what the Zappos culture means to them. But for typos, it’s unedited. Hsieh offers the book freely to anyone who wants a copy.
Ultimately, Hsieh believes that every company needs to determine its core values, and rather than have a vague sense of what those ideas should be, he insists it is important to select ‘committable’ core values. “By committable, you must be willing to hire and fire based on them” he explains.
So next time you’re in Las Vegas, remember that Zappos offers tours every weekday; Hsieh suggests Mondays or Thursdays are best. “Just e-mail me and we’ll pick you up in the Zappos shuttle, give you a tour and drop you off at your hotel.” That’s a fairly impressive offer, and one not many companies are likely to make.
If you truly want to get a feel for the young bright Zappos CEO, watch the video below, and perhaps you’ll get a glimpse into why this company is wowing the social media set.