Zappos
Contents
Question 1: What are Zappos’ supply chain related core competencies and sources of competitive advantage? How sustainable are they? What role does corporate culture play in these questions?
Zappos consider themselves “a service company that happens to sell shoes”. The main core competency of the company is its customer service. Hsieh considered customer service to be one of the most important aspects of the business. If a business has excellent customer service, then customers are more likely to return to purchase from the business again. Hsieh saw that excelling in customer service and trusting the word of mouth of their customers would build up their customer base and their sales. A 24hour call centre and a toll-free number, which was displayed on all of their websites, were the basis of this customer service. Every call operator was trained to deal with any situation; there was no need for the customer to be transferred to a different operator or to hold while a supervisor/manager was called.
Zappos provide free delivery to their customers within 5 working days. However they aimed for next day delivery. This was all part of the customer service which Hsieh was so passionate about. If a customer received their purchase the next day, they were impressed and more likely to purchase again. One of the biggest issues for customers when buying online is the issue of fit. Since you physically cannot try on the product before buying it, it leads to customers being reluctant to buy online. Zappos addressed this problem by providing free returns 365 days of the year.
Zappos’ excellent customer service is a distinct competitive advantage. Another one is their acquisition of the online discount shoe retailer 6pm. Through 6pm, Zappos could sell shoes at clearance prices without harming their own image as a high end retailer. They monopolised the shoe market as they could now target many different customer bases. Another advantage is bringing their
Question 1: What are Zappos’ supply chain related core competencies and sources of competitive advantage? How sustainable are they? What role does corporate culture play in these questions?
Zappos consider themselves “a service company that happens to sell shoes”. The main core competency of the company is its customer service. Hsieh considered customer service to be one of the most important aspects of the business. If a business has excellent customer service, then customers are more likely to return to purchase from the business again. Hsieh saw that excelling in customer service and trusting the word of mouth of their customers would build up their customer base and their sales. A 24hour call centre and a toll-free number, which was displayed on all of their websites, were the basis of this customer service. Every call operator was trained to deal with any situation; there was no need for the customer to be transferred to a different operator or to hold while a supervisor/manager was called.
Zappos provide free delivery to their customers within 5 working days. However they aimed for next day delivery. This was all part of the customer service which Hsieh was so passionate about. If a customer received their purchase the next day, they were impressed and more likely to purchase again. One of the biggest issues for customers when buying online is the issue of fit. Since you physically cannot try on the product before buying it, it leads to customers being reluctant to buy online. Zappos addressed this problem by providing free returns 365 days of the year.
Zappos’ excellent customer service is a distinct competitive advantage. Another one is their acquisition of the online discount shoe retailer 6pm. Through 6pm, Zappos could sell shoes at clearance prices without harming their own image as a high end retailer. They monopolised the shoe market as they could now target many different customer bases. Another advantage is bringing their
References: Bets, Mitch, (2010). Zappos earns #1 Ranking for E-Retailing. Computerworld Clack, Erin E., & Young, Marcie, (2009). Footwear News. 5/4/2009, Vol. 65 Issue 17, p24-1NULL. 1p. 4 Black and White Photographs. Footwear News, (2009). Zappos Milestone: Timeline, Footwear News - Monday, May 4, 2009 Karman III, John R., (2011). 2011 Year in Review: Hiring, expansion plans make Zappos a major economic engine for Bullitt County. Business First Martin, Russ, (2013). Marketing Magazine. 8/19/2013, Vol. 118 Issue 8, p20-21. 2p. 1 Chart. Pablo, Sarahlynn, (2010). Zappos Branding Strategy: Delivering Happiness; A Path to Profits; Passion and Purpose Witkin, Jim, (2012). How Zappos profits from the happiness business. The Guardian