Zapped by Zappos – Learnings from CEO as CMO Tony Hsieh


The best CMO is a CEO who believes in Marketing. By this definition, Tony Hsieh, CEO of Zappos.com, must be one of the best CMO’s around. Hsieh, known for his firm’s digital and social networking prowess, had over 870k Twitter followers the last time I checked. I recently talked with Tony after he participated in a “What’s Your Digital?” panel discussion. And what he had to say might surprise you.

TonyHsieh

Tony Hsieh -- The Zappos CEO as CMO

Zapped by Zappos

Before that, however, let me tell you about my own Zappos experience—which is instructive. Seeking a pair of dress shoes for my new job, I went on-line to Zappos, and saw a great pair of shoes on the Mezlan Zappos homepage. I searched for the shoes all over the site — to no avail. Exasperated, I sent Zappos an e-mail, asking: “where are those great looking shoes?” No response. I sent another e-mail, and waited…and waited.

Finally, I received a short e-mail:  “Yes, you’re correct; we don’t carry that particular pair of shoes and will remove the photo from our site.” And they did. In fact, here’s the new picture sans shoes:

Mezlan_Shoes

Mezlan on Zappos - Without the Shoes

This is great customer service? So, I related my story to Tony. He seemed mortified, especially after talking about how much Zappos cares about customer experience. He then followed up to have someone reach out to understand what happened so they could fix it, followed by an offer to send me a free pair of any shoes I wanted. Now, not everyone gets to talk to the CEO about their poor customer experience, but Zappos clearly IS different.

What Makes Zappos Different?

Simply stated, Zappos believes that customer service = marketing. Instead of spending loads of money on traditional (and non-traditional) marketing, they focus intensely on delivering a great customer experience—and recovering from mistakes with grace and humility. Tony believes that “the Zappos brand manifests itself through every employee/customer interaction,” and that brand is a lagging indicator of customer experience. His key points:

  • “The phone is a great marketing tool” – I’m not taking about mobile marketing here. Tony made the point that 5 minutes with a customer on the phone is far better Marketing than any web experience can ever deliver. He loves the phone and bricks and mortar touch points and thinks they are often undervalued by companies.
  • “Culture is our number 1 priority” – Many companies talk a good game about culture, but Zappos actually lives it and uses it as a core part of their business model. Zappos has 10 cultural norms that they instill in employees. They interview for these 10 norms, evaluate employees on them in their annual performance reviews, and let people go who don’t follow them.
  • “Authenticity and transparency are really important” – Tony sees authenticity and transparency (to read more on this topic, see my blog post) as a core part of the Zappos brand. When reporters show up at Zappos, they’re shown the bathroom and lunch-room and then told to roam around and talk to whomever they like. Tony’s daily Tweeting is less about Marketing than it is about him trying to make Zappos more authentic and transparent for followers.
  • “Zappos wants totally engaged employees” – Tony only wants people working at Zappos who are really passionate about the company and delivering great customer service. How much does he believe in this? So much that the company offers every new employee $2k to quit after two weeks on the job – they only want the truly committed.

What About Digital and Social Media?

But isn’t Zappos a social media icon? What about Tony’s almost 1MM Twitter followers? Well, get this: Tony hates the “social media” tag. He says they don’t even bother to measure the ROI of their digital and Twitter efforts.

Further, he’s not a believer in creating marketing “buzz.” Instead, he believes the primary role of every employee is to create “positive customer stories” about their Zappos experience. If they do this–everything else, including buzz, will take care of itself.

Oh, and one more thing. Tony does believe in the importance of “influencers,” but not necessarily the digital kind you might be thinking of. He noted that to this day, when his mom calls, he really listens.

Key Learning’s for Marketers

First, having a CEO who really believes in the brand and customer experience sets the tone for the whole organization. This job shouldn’t and can’t be left to the CMO; it’s the CEO’s job too. The CEO and CMO need to be partners in driving a truly customer-centric, marketing focused organization and business model.

Second, actually delivering a great customer experience, particularly in a service oriented business, comes down to employees delivering each and every time they interact with a customer. Building a culture that attracts the right kind of employee and fosters this kind of performance is just as important as any Marketing program.

Zappos Secret Weapons

These are Zappo’s true secret weapons—their CEO as CMO and their unique culture. So what about my Zappos experience? I like Tony’s description of what employees are supposed to do: “Create positive customer/employee stories.” But what I love most of all is that Tony, as the CEO, does what he says. After all, you just read a story about how Zappos recovered brilliantly from a terrible customer experience. Clearly, Tony knows how to create a good story, too.

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6 Responses to Zapped by Zappos – Learnings from CEO as CMO Tony Hsieh

  1. Matt Gardner says:

    On brick and mortar touch points, Zappos had one of the more clever and relevant OOH media placements I have seen in quite a while. In Newark airport, they obtained rights to advertise their site on the inside of airport security bins where you place you shoes/laptops etc.

    • beardrs says:

      Hi Matt — Thanks for reading the blog and commenting. Funny you mention this because I’ve seen the same thing and thought: “That’s really clever.” Sometimes the simples ideas are the best ones.
      Randall

  2. Lan Guo says:

    What convinced me to give Zappos a try years back was its free return shipping policy. It removed the biggest hurdle in online shoe shopping. Hyundai’s assurance program did the same for new car buyers in this recession. Great job in discovering and executing on such consumer insights!

    • beardrs says:

      Hi Lan — I think one of the key jobs marketers have is to understand “barriers” to consideration and purchase among their target consumers, and then figure out how to creatively but systematically eliminate them. Both Zappos and Hyundai did this, albeit in very different ways. Thanks for contributing your comments to the blog.
      Randall

  3. […] La chose est exposée par le meilleur blog marketing (si, si…) de la Toile. Mais tout d'abord, Zappos, en deux mots. C'est société américaine de vente en ligne de chaussures. Créée en 2000, elle réalisait un chiffre d'affaires d'1,6 millions de dollars ; aujourd'hui, elle a passé le milliard de dollars et a été rachetée cette année par Amazon. […]

  4. […] La chose est exposée par le meilleur blog marketing (si, si…) de la Toile. Mais tout d’abord, Zappos, en deux mots. C’est société américaine de vente en ligne de chaussures. Créée en 2000, elle réalisait un chiffre d’affaires d’1,6 millions de dollars ; aujourd’hui, elle a passé le milliard de dollars et a été rachetée cette année par Amazon. […]

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