For those of you who don’t know Tony Hsieh, (pronounced Shay) he is the CEO of Zappos.com that recently just got bought out by Amazon for a whopping $900 million.
So why would Amazon pay that much for what seems like just another online retail company – especially in what seems an economy on the verge of collapse?
I believe there are a number of reasons but probably the three most important ones are:
1. Zappos is built around providing the best customer service.
To start they expose their customer service 1-800 number at the top of their website pages. If people have questions they can easily call. (They receive upwards of 5000 calls a day and answer them all). They have a 365 day return policy. They’re NOT a rental company – so you can’t returned used items, but if you’re a procrastinator (like me) you have an entire year to return an unused item.
They also offer free shipping both ways. So if you want to return an item they pay the shipping. Their warehouse, although Tony admits is inefficient, runs 24×7 which means customers get their items quicker.
Zappos would rather spend money improving upon what makes their existing family of customers happy instead of spending money on getting new customers through marketing. The majority of their business is built on referrals and the model has definitely worked as 75% of business is from repeat customers on a daily basis.
These are just a few of the subtleties they’ve incorporated in their business practice that make them more than just an online retail company.
2. The company’s foundation is built around culture.
Zappos has formalized it’s culture into 10 core values.
- Deliver Wow Through Service
- Embrace and Drive Change
- Create Fun and a Little Weirdness
- Be Adventurous, Creative and Open-Minded
- Pursue Growth and Learning
- Build Open and Honest Relationships with Communication
- Build a Positive Team and Family Spirit
- Do More with Less
- Be Passionate and Determined
- Be Humble
These core values supersede everything else. Their hiring policy is based around whether someone fits into the company culture regardless of their skill-set or expertise. They’re also not afraid to fire people if they don’t respect and follow the company’s core values. How many companies do you know let their employees create their internal core values or mission statement but also use it for more than just piece of artwork on the wall?
3. Zappos is visibly transparent.
Every year Zappos publishes a culture book written by it’s employees. Click here for 2008 edition. With the exception of spelling mistakes the book goes unedited. Which means both the bad and the good get exposed from within. With social media taking the world by storm transparency is a must for entrepreneurs, business owners even employees if they hope to gain the trust and loyalty of those around them.
So why am I telling you this besides hoping to give you some great insight from a company who’s success continues to grow even through economic uncertainty?
Because I’d like to open the dialog and become an active listener and be more involved in the things that matter most to you. Find out what your core values and beliefs are. So I invite you take a look at your core values. Write them down. and Practice them.
(I’d love to read your list – Please post in comments below.)
I will give you my 11 core values in the next post. Why 11? View the Power of 11 Post here.
(Photo: Robert Scoble)