Teaching Methods and Higher Education
Minder Chen
Associate Professor of MIS
Chair of the Business and Economics Program
Martin V. Smith School of Business and Economics
CSU Channel Islands
minderchen@gmail.com or minder.chen@csuci.edu
Web site: http://faculty.csuci.edu/minder.chen/
Course materials: http://faculty.csuci.edu/minder.chen/event/
Zappos - 1
http://images.businessweek.com/ss/09/02/0219_customer_service/20.htm
Zappos - 2
Zappos
• Founded in 1999.
• “A service company that just happens to sell
shoes.” - Tony Hsieh, CEO of Zappos
• Zappos can cultivate a reputation for
outstanding customer service to the point
where it, too, can become a springboard into
several markets.
• It rang up a record $1 billion in sales in 2008.
• Employees are referred to as “Zapponians”.
Zappos - 3
Customer Service Is Everything
• At Zappos.com, Customer Service Is Everything.
In Fact, It's The Entire Company.
• We've been asked by a lot of people how we've
grown so quickly, and the answer is actually
really simple... We've aligned the entire
organization around one mission: to provide
the best customer service possible. Internally,
we call this our WOW philosophy.
Zappos - 4
Case Study Questions
• Why selling shoes online is not considered a good e-commerce idea?
• What policies Zappos have to make it easier for you to buy shoes
online?
• Why changed Tony’s mind to invest in Zappos (shoesite.com)?
• Why were the challenges in the early stages of Zappos company
history?
• Why Amazon acquired Zappos?
• Why Zappos moved its headquarter to Las Vegas?
• Why Zappos logistic center at
• Explain the meaning of Zappos’s culture and how it foster its culture
• What are the major differences between Amazon and Zappos?
• What are the unique approaches that Zappos have taken that are
against traditional wisdom?
• “Carry less and sale more” (drop-ship) vs. “Carry all”
• Outsource call center vs. in-house call center
• How is the performance measured for call center employees?
Zappos - 5
Assignment Questions
1. What are Zappos’ core competencies and sources of competitive
advantage? How sustainable are they? What role does corporate
culture play in these questions?
2. How important is next-day air shipment to the customer experience?
Is it worth the cost? How might you change it in the cost-conscious
environment facing the company in late 2008?
3. How would you expand the business? Would you add more products,
more geographies, or by selling private labels? As you expand the
business, how can the company become more profitable, particularly
in light of the costs associated with the focus on service?
4. How would you expect the environment of a more cost-conscious
consumer to affect Zappos’ business? What can Zappos do in such an
environment to maintain sales growth?
Source: Stanford Graduate School of Business, Case GS-65, Teaching Notes
Zappos - 6
Zappos 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
Zappos - 7
10 rules for creating a customer-centric culture
1.
2.
3.
4.
5.
6.
7.
8.
9.
Make customer service a priority for the whole company.
Make "wow" a part of your company' vocabulary.
Don't measure call times, and don't force agents to upsell.
Empower your customer service team.
Don't hide your toll-free number.
Have the entire company celebrate great service.
Create a culture book.
Find people who are passionate about customer service.
Give great service to everyone: customers, employees, and
vendors.
10. Make customer service part of everyone's performance reviews.
Source: http://decker.typepad.com/welcome/2006/12/zappos_10_rules.html
Zappos - 8
Sold to Amazon
• It was announced on July 22, 2009 that
Amazon.com would buy Zappos for $940 million
in a stock and cash deal. Owners of shares of
Zappos were set to receive approximately 10
million Amazon.com shares, and employees
would receive a separate $40 million in cash and
restricted stock units. The deal was eventually
closed in November 2009 for a reported $1.2
billion.
• Softline vs. hardline goods
Zappos - 9
• 謝家華（左）與林君叡的辦公室根本連門都不設，頂上裝
飾成熱帶雨林，還有猴子。 記者馮鳴台／攝影
• Read more: 世界新聞網
Zappos - 10
Zappos - 11
Logo Design
Zappos - 12
Zappos - 13
Zappos - 14
Zappos - 15
Zappos - 16
Business Week Customer Service Champ
• Consider No. 7, Zappos.com, the online shoe retailer whose devoted
fans rave about its free shipping on both orders and returns. The
retailer had typically upgraded both first-time and repeat customers
to overnight shipping even though it wasn't advertising that perk.
• But starting in 2009, Zappos will no longer offer overnight upgrades
to first-time visitors. Instead, CEO Tony Hsieh is moving those dollars
into a new VIP service for Zappos' most loyal shoppers. Launched in
December, the site, which for now can only be accessed by loyal
customers who receive an invitation, promises overnight shipping
and plans to offer earlier access to sales and new merchandise than
the plain-vanilla site. (Repeat customers who aren't yet asked to join
the VIP service will continue getting the overnight upgrade for now.) “
• We decided we wanted to invest more in repeat customers," says
Hsieh. "We're shifting some of the costs that would have gone into
new customers."
http://www.businessweek.com/print/magazine/content/09_09/b4121026559235.htm
Zappos - 17
The service is the product/brand.
• Shoes are commodities. Any the same shoes
you buy at Zappos can be bought at ten other
online shoe stores.
• The reason Zappos succeeds is that they are
adding value to otherwise indiscernible
products. The service is the product.
Zappos - 18
A Package from Zappos
Zappos - 19
Happiness
Zappos - 20
Zappos - 21
Zappos - 22