Tools. This section of the site provides regularly updated tool kits, such as the complete downloadable “Zappos Family Core Values Interview Assessment Guide” mentioned in Chapter 2 and the call review form and Happiness Form mentioned in Chapter 7.Brand positioning experts understand that consumers give companies “permission” as to how far they can stretch their product and service offerings. For example, in the 1990s, Clorox considered extending its well-established bleach brand in the direction of laundry detergent, dishwashing soap, and other household cleaning applications. Consumer research, however, showed that Clorox was synonymous with bleach in the minds of the buying public and that consumers would be hesitant to purchase any Clorox product that would touch their hands or their dishes. As a result, Clorox focused its brand extension in the direction of toilet bowl cleaners, tub and tile products, and drain openers. Like that of Clorox, the early brand positioning of Zappos put it at risk of being denied permission to grow outside of a shoebox. However, a broad vision of the future, careful listening for customer requests, and an increasing level of consumer trust has allowed the Zappos brand wide opportunities to S T R E T C H.
If you type “www.shoesite.com” into your browser, the Zappos website will appear. Nick Swinmurn secured the address shoesite.com for his online shoe store in 1999, but later that year, the name was changed to Zappos. The company’s leaders understood that a made-up name like Zappos would provide a unique, searchable Internet identity and would allow the company to broaden its product offerings if brand extension was ever deemed appropriate. Consistent with the leaders’ wisdom in deciding to rebrand the start-up, the Zappos name has allowed the company to stretch outside of its original mission of “becoming the première destination for online shoes” and venture into a broader world of merchandise and services.
Zappos made its first brand extensions into categories that were closely related to its shoe product line. Like Clorox, Zappos initially moved into areas that were a natural fit with footwear (bags, accessories, and clothing); then product offerings steadily branched out into housewares, beauty supplies, sporting goods, and more. From a pure product perspective, Tony Hsieh attributes this brand expansion to “our success through service. Once we understood that service was our brand, we also realized that all products were just vehicles through which we could deliver service. I hope someday, in the not too distant future, people won’t even remember that we started out by selling shoes. We are thinking well beyond e-commerce, and our customers will guide us to where they want to receive Zappos service. Maybe someday we will have a Zappos airline, for example. Additionally, we want to turn downtown Las Vegas into the next Austin, Texas, as a hub of culture, innovation, and community.”
Alfred Lin, former Zappos CFO, was quick to laughingly interject, “I’ve discouraged Tony from jumping into the highly capital-intensive airline business, but suffice it to say that the Zappos current business model is somewhat capital intensive, so who knows. It’s clear that the sky is not the limit for Zappos.” The breadth of the Zappos brand elasticity is often compared to that of the Virgin Group. Virgin leveraged its edgy appeal and the charisma of its founder, Sir Richard Branson, to create more than 300 Virgin-branded companies worldwide in diverse enterprises involving music, mobile communication, money, and, of course, an airline. In essence, Virgin created an image that people wanted to be associated with, so it was able to extend its brand based on trendiness. By contrast, Zappos is a brand people want to be served by and as such can expand from its service platform.
The initial Zappos forays into clothing sales were a direct result of consumer interest. According to Alfred Lin, “Our customers kept asking us to provide clothing and other accessories to go with their shoe purchases. We went in that direction because of our customers’ passion for our service and because of the passion of people in the company. We understood how clothing would augment our customers’ purchase experience. We also saw an opportunity, with clothing being a four times larger market than footwear. I hope that Zappos will shift from approximately 80 percent of sales through footwear to something on the order of 20 percent of sales over time.”
In this brand extension phase, the leaders at Zappos have sought to capitalize on the infrastructure they developed to dominate online shoe sales, while also learning the nuances of broader merchandising categories. According to Fred Mossler, “just Fred” at Zappos, “We face a very different situation in selling clothes today compared to what we faced when we began selling shoes. Back then, no one was selling shoes on the Internet. We were the leader. We needed to get our selection in place and then add layers of service and personal emotional connection. Fast forward to our current reality, where we are experiencing very fast growth in our clothing category, but also where clothing on the Internet is a $20 billion plus proposition and we have a very small share.” Fred explains that many shoe catalog companies learned from Zappos. As a result, they took shoes that were being sold through catalogs and moved them into Internet sales. While Zappos was gaining dominance in the shoe category, well-established clothing providers, both brick-and-mortar and catalog, were making their way onto the Internet as well. Some of these stores were modeling their strategies on what Zappos was doing in the shoe category. Essentially, Zappos is now trying to advance into existing Internet clothing markets, as opposed to innovating and gaining dominance in an emerging category. Fred notes, “This truly has been a stretch for us and a different sort of competitive landscape. We have also had to master a different product presentation. Even our distribution center is slightly more optimized for picking, packing, and shipping a bunch of items in boxes, like shoes, rather than items on hangers or in poly bags. These are the areas we have had to address in making the transition to constantly improve the customer experience for clothing shoppers.”
Business success depends on evaluating your key competencies and listening to customer needs. Success also requires a willingness to take calculated risks in the direction of growth. Zappos heard the increasing chorus of customer voices tweeting, writing to the company, and posting blogs asking Zappos to serve them with a broader array of product choices, or to give them the opportunity to buy a complete outfit in the comfort of their home. As Fred puts it, “A lot of times, the biggest gamble you can take, when you have a groundswell of customer interest, is failing to try new ideas and being satisfied with where you are. Clothing, for example, is something we got into in 2007. We saw clothing as a big piece of our business in the future, and it has already grown into an important component for us. We have even made shifts in marketing to include a focus on the three Cs—customer service, culture, and clothing. We want every new customer to think of us as a destination for clothing purchases. While many consumers wanted us to venture into clothing, we still have the challenge of changing the mindset of a large portion of our existing customer base so that they see us as more than shoes.”
Fred and other leaders emphasize that, to shift external brand perceptions effectively, the shift must first occur within the business. Galen Hardy, Zappos clothing czar, notes, “We have to focus on internal communication. When your ship has been sailing in a single direction, toward shoes, for seven years, it takes consistent conversations within our walls to remind our people that we are not in the shoe business; we are in the service business. We offer whatever the customers want us to serve to them.” Through blogs from Tony and other Zappos leaders, conversations in all-hands meetings, leadership discussions about core values like “delivering wow through service,” and emphasizing the business/service opportunity that comes from expanding merchandise categories, Zappos leaders have changed the internal dialogue—away from shoes and in the direction of clothing and service. In addition to the shift in staff perceptions, Zappos has had to develop a new set of vendor relationships and has had to leverage the skills it learned in the early days of courting shoe suppliers.
Jeanne Markel, director of Casual Lifestyle, notes that while many clothing brands have a strong online presence, others are reluctant to let a company like Zappos represent them on the Internet. According to Jeanne, “Some of these brands prefer the control of a drop-ship model, and most have a strong need to protect their brand presentation. Couture brands, for example, have concerns that often surface through questions such as, ‘What if we don’t like the way things are presented? What if we don’t like the image? How is that going to affect our brand perception?’ I think there are fewer of those concerns as our clothing lines progress, but there are still pockets and divisions that are struggling to make peace with online sales.”
Clothing experts at Zappos also face vendors who fear Internet purchases will result in their brand being viewed as a commodity. Galen notes, “There are a lot of people thinking that the Internet is purely for discounted products or for coupons or price matching. We have to sell vendors and clothing consumers on our successful service value proposition. They have to understand that our customers are not as price-conscious as they are service- and selection-conscious.” Jeanne eloquently summarizes the greatest stretch challenge for Zappos as it moves into other sectors like clothing: “I don’t pretend that there’s a large part of the consumer population, let alone the Zappos customer base, that says, ‘Gosh, I need a blender. Let me go to Zappos.’ But that is our challenge: to have people with a want or need automatically run to Zappos to see if we can fill it.” Brand positioning and expansion are challenging propositions. The most salient aspects of your brand identity can either propel or restrict you. In the case of Zappos, its strong identification with shoes makes it harder for customers and vendors to think of it when it comes to items in other categories. Conversely, the strength of the service identity at Zappos gives the leaders permission to take that service acumen into other product areas. What are the strongest aspects of your brand identity? How do those strengths help or hamper your brand extension efforts? What are the wants and needs of customers that fit with the brand extensions you are considering?
Customers are certainly letting Zappos know what they want, as evidenced by examples from blogs and tweet streams. Blogger Tim Sanchez shared this observation on his popular Deliver Bliss blog: “While the value delivered by the airlines continues to diminish, Zappos is always striving to incrementally improve itself. As they become increasingly more efficient and refuse to succumb to the good enough syndrome that plagues its competition, Zappos continues to serve as an example for not just a great shoe company, but a great service company. I don’t know about you, but I’ll be waiting in line to buy my ticket on Zappos Airlines.”
Here are some views of the Zappos brand expansion from the Twitter community:
@scheduleflyin
Hey zappos, if you sold health insurance, I’d buy it. Just sayin.
@Jayfromma1
zappos will you get involved in government, then politicians would be more fun
@micahyost
we need zappos to run the custom home building business. They just can’t figure out the service after the sale!
@bizshrink
Imagine zappos airline—delivering happiness w/no charge 4 surprise upgrade to 1st class. I’m there. happy flier & early arrival
Name a segment of our economy where service is lacking, and you will probably find disgruntled customers encouraging, if not imploring, Zappos to extend into that marketplace.
While it’s one thing to expand into additional product sectors like clothing, it’s an entirely different endeavor to launch a business training service division like Zappos Insights. Some of the most noteworthy ingredients involved in this bold brand extension included Tony Hsieh’s desire to promulgate a business revolution or movement, considerable interest in the brand’s business practices, and a well-connected community of brand fans who want to understand how Zappos achieved its success.
Over the years, a sizable number of people who requested a Zappos tour did so simply to better understand how this atypical company could become both a survivor of the dot.com crisis and a leader in online product delivery. While those tours offered a glimpse into the Zappos culture and an overview of the company’s business practices, many of the tour-goers wanted more. As the company received increased public attention, more business leaders, department heads, associations, and owners of small businesses reached out to see if Zappos could share best practice ideas with them. Zappos was increasingly being defined as a unique thought leader, and something had to be done to address the demand. So, enter the business division Zappos Insights!
The mission of Zappos Insights can be described in both tactical and transcendent terms. Donavan Roberson, Zappos Insights culture evangelist, notes, “We are here to help people at every level of a business. Whether CEO, owner, manager, or front-line employee, people come to us for tools and ideas, and for the opportunity to connect with like-minded individuals. We serve as a resource for those committed to culture building and service excellence.” Robert Richman, Zappos Insights product manager, adds the transformational aspect of the Zappos Insights mission: “It is our sincere objective to make the workplace and the world at large a happier place. We want to deliver happiness to those who also want to build happier workplaces. Since people spend so much time at work, we believe happy workers make for happier partners and parents, which make for happier kids. We’ve seen the power of an engaged workplace here at Zappos, and we want to support that movement, one company at a time.”
Like most things Zappos, a trial and improvement approach was used for the Zappos Insights division. Through its various iterations, Zappos Insights primarily offers a service array that is anchored to a reasonably priced monthly membership site. In case you have not started the complimentary 30-day trial membership with Zappos Insights presented at the back of the book, allow me to provide you an overview of the platform through which the following services are easily accessed:
Tools. This section of the site provides regularly updated tool kits, such as the complete downloadable “Zappos Family Core Values Interview Assessment Guide” mentioned in Chapter 2 and the call review form and Happiness Form mentioned in Chapter 7.
Culture lab. In this section, Zappos Insights members are given opportunities to learn from individuals in businesses that have made changes in their company culture or service delivery processes. These video presentations demonstrate the power of the Zappos leadership concepts, particularly as those concepts are adapted to fit the varied needs of other business sectors.
Experts. The Zappos Insight team conducts video interviews with bestselling authors and leadership experts who provide both inspiration and practical advice.
Events. The Zappos Insights team is involved in planning on-site training events, from basic tours, extended visits, and half-day or daylong training to two-day Zappos culture boot camps.
Community. Zappos Insights encourages and develops communities of members who are striving to improve workplace culture and service delivery.
Rachel Cosgrove of Results Fitness in southern California attended the two-day Zappos Insights culture boot camp and notes, “I knew about Zappos culture when I heard Tony speak at a conference I was attending in Las Vegas. After that, I decided I needed to learn more from this company. I felt we had a pretty good culture at our fitness center, but we hadn’t dialed in our core values. When Tony talked about leaders’ needing to create something bigger than themselves, I was fully plugged in, and I knew I wanted to learn everything I could about and from Zappos. I sent an e-mail to Tony about possible training, and I quickly received a personal e-mail response. The CEO of Zappos responded directly and added a surprise book on top of it. I then joined the Zappos Insights website and received yet another surprise gift. So for me it was like a series of wows right in a row.”
Rachel reports that she attended the culture boot camp, and then, “I went back to our gym, had a meeting with our team, and we redid our core values. Everybody started to realize I had been Zapped. I was talking a lot about Zappos, and people in the fitness industry were asking, ‘Why are you learning from Zappos? You run a gym.’ But we definitely took a lot from Zappos Insights and have implemented those learnings in our gym, and that has taken our culture to a new level.” Rachel and her husband, Alwyn, have incorporated their own core values into the daily conversations of their business. They have made changes in their employee selection processes and their customer service delivery strategies, and they have even invited their staff to create a Culture Book. Rachel sees Zappos Insights as having made a “lasting, long-term, and profound impact on our culture at Results Fitness.”
In addition to instilling many aspects of the Zappos culture into his business, Deryl Sweeney, president of DormBuys.com, attended Zappos Insights training and focused on increasing his commitment to the velocity of service delivery: “One of our big takeaways was asking ourselves how committed we are to good customer service. It taught us that we are not going to find a company out there that says it has crappy customer service. We had to look at taking service up to the Zappos level. After we did boot camp, we looked at whether we could offer free overnight shipping, and even though we couldn’t, we developed systems to ensure that orders placed by 3:00 eastern time would go out that very same day. By making that change, and given that we are based in Louisville, Kentucky, we are able to have our products to the majority of our customers in one to two days. The Zappos Insights boot camp inspired us to expedite getting our products to our customers’ doors. Similarly, we put systems in place to make sure we are answering the phones personally. We came away realizing that people don’t want to go through a bunch of robotic prompts—they want to get a person. It may seem basic, but we got a deeper appreciation for taking service to the more urgent and more personal level.” Rachel and Deryl’s experiences at the boot camp speak to the importance of bench-marking great service businesses. They also identify an approach to maximizing the benefits that come from looking for the best practices of others. After spending time at Zappos, Rachel and Deryl were inspired to enhance their culture and increase their service urgency. Rather than attempting to emulate the Zappos overall service approach, they evaluated what was realistic for their businesses and set service improvement goals that were consistent with their specific circumstances.
Zappos Insights gives a transparent look into what makes Zappos work as a values-based organization. But, ultimately, Zappos is just the beginning. As CEO Tony Hsieh envisions it, “I hope that Zappos can inspire other businesses to adopt happiness as a business model—letting happy customers and happy employees drive long-term profits and growth. Ultimately, it’s all about delivering happiness.”
This thought naturally explains the creation of Delivering Happiness, the company Tony Hsieh and Jenn Lim cofounded to carry out this vision of applying happiness as a framework not just in businesses but also in organizations and communities around the world. The belief is that Zappos just happens to be the first of many organizations that will incorporate happiness as a business model to positively affect things like productivity, profits, customer service, culture and—as a result—the overall level of happiness in the world. Delivering Happiness emerged as a company to see this vision through.
Jenn Lim, CEO and chief happiness officer of Delivering Happiness, notes, “DH is about spreading and inspiring happiness to companies, in the way Zappos has shown it can be done, as well as to nonbusiness sectors (e.g., education, nonprofits) and everyday life (e.g., students and families). It’s really been both phenomenal and humbling to hear the feedback from people who have read the book. Taking it all in, we’ve seen a common thread emerge: regardless of age, background, history or culture, more and more people believe that the science of happiness can tangibly make our world a better place. It’s this response that led us to create a company around it and, ultimately, the Delivering Happiness Movement.”
Jenn continues, “The unanticipated response comes from wide-ranging places:
A fledgling bar/lounge in Austin that became the number 1 venue after reading the Culture Book and redirecting its focus on employees
A CEO of an amusement park in Korea who was reminded of the reason he is in the business (corporate culture and happiness)
A student from the University of Iowa who dropped the major her parents prescribed to her (premed) because she always wanted to be an art teacher
A trader on the verge of suicide, who was given some hope after reading about the failures Tony Hsieh had to overcome before his successes
A mobile marketing entrepreneur in Uzbekistan who was inspired to pursue his passion even though everyone was telling him the “[economic] sky is falling”
A mom who vowed to be the CMP (chief managing parent) of her household because she knew she was a good parent but realized she could be better
“Even though the response to the book was unexpected,” Jenn adds, “it began to make sense after thinking through the research that’s been done around it. Following Maslow’s hierarchy, once someone’s basic needs of food, safety, and shelter are met, people seek to find their higher purpose and happiness in life. You get a sense when you ask people, ‘What are your goals in life and why?’ Whether the goal is to have children, travel the world, or drive racecars for a living, the ‘why’ usually comes down to the same things—finding meaning and happiness. We’re just talking different paths to get there. An interesting finding highlighted in the book Delivering Happiness is that studies show humans are really bad at predicting what will bring sustainable happiness. That’s why it was such a revelation. As more and more people told us they were inspired to make a change in their lives—big or small—to be happier, it just made sense to evolve the book into something else. The book seems to have nudged people and companies toward happiness, so our cause is to support and nurture that as best we can. The book also explores other frameworks of happiness that match the subjective nature of ‘happiness’ to the objective nature of science. As highlighted in the book, research shows that happiness can be described by four fundamental things: perceived control, perceived progress, connectedness (the number and depth of your relationships), and vision/meaning (being part of something bigger than yourself). What’s interesting, as Tony Hsieh explains in the narrative, is that these concepts can be applied both to business and in life.”
Another framework describes happiness on a chart where the two axes are Time and Level of Happiness. On it, there are three types of happiness: Pleasure, Passion, and Higher Purpose. Tony Hsieh elaborates, “What I find interesting is that many people go through life chasing after the pleasure type of happiness, thinking that once they are able to sustain that, then they will worry about the passion and, if they get around to it, look for their higher purpose. Based on the findings of the research, however, the proper strategy would be to figure out and pursue the higher purpose first (since it is the longest-lasting type of happiness), then layer on top of that the passion, and then add on top of that the pleasure type of happiness.”
Similar to other cause-based companies like TOMS Shoes, Delivering Happiness operates as a social enterprise, implementing ways to generate revenue in order to fuel the DH Movement. Some of the avenues to revenue include
Culture Book creation services (as mentioned in Chapter 3)
On-site, customized workshops for companies and organizations that want to increase productivity and happiness in the workplace (as a complement to Zappos Insights training)
The Delivering Happiness Store, which sells inspirational merchandise and, down the road, experiences (as examples, helicopter lessons or group trips to Antarctica) to further instill that the equation of happiness ultimately comes from our collective memories and experiences, not the material goods we buy
Follow-on books to target the different audiences that have emerged since the first one was launched
Much like Zappos, Delivering Happiness sees revenue as a means to its higher purpose. With “Inspire and Be Inspired” as one of its mottos, if Delivering Happiness continues to be inspired by stories of people’s journeys toward happiness, their cause to inspire others will surely go on.
Whether through Zappos Insights or the emergence of Delivering Happiness, Zappos has demonstrated thought leadership in business and social excellence. Often that excellence is fueled by a willingness to provide tools that allow interested individuals an opportunity to learn, adapt, and execute on a few key take-aways gleaned from companies like Zappos.
Zappos has stretched its product array, but it has also pushed the boundaries of marketing in the “new media.” Inarguably, Zappos has blazed a path in social interactivity that is often talked about but seldom effectively emulated. This top-of-mind positioning led David Meerman Scott, marketing/leadership strategist and writer of the Webink Now blog, to suggest that Zappos may be stifling the growth of social media innovation. Specifically, David notes, “Hundreds of ‘social media experts’ cite the company in their books, blogs, speeches, Webinars and the like. As a result, the marketing discipline is not moved forward because we don’t learn about other companies and their success. … My issue is not with [Zappos] but with those who incessantly use this one example as ‘proof’ new marketing works.” David goes on to note that Zappos has definitely earned its reputation as a trendsetter in social media, as evidenced by extraordinary outcomes like company CEO Tony Hsieh having more than “1.75 million followers on Twitter” and its “brilliance in social media … cited 5.8 million times on the Web.”
As further evidence of this dominance in social media, a customer service chat group on Twitter created a “pseudo-drinking game.” Geoff Snyder, a network facilitator and member of that customer service chat group, notes, “We conduct our discussion on Twitter, and Zappos examples come up so often that we decided to make a game out of references to the company. Zappos has set a standard that we look up to. So whenever someone mentions Zappos, we take a sip of our drinks (symbolic or otherwise).” When your name comes up so often that Twitter chat groups salute those references with a real or symbolic toast, you have functionally saturated the social network world. In 2010, when Zappos announced that it was opening an office in San Francisco and that it was hiring 2,000 employees to meet overall employment demand in 2011, each of those messages was retweeted (forwarded, if you will) thousands of times.
So what is it that Zappos does to leverage social media so effectively? In my opinion, the Zappos social networking success can be linked to placing more emphasis on the “social” and less on the “networking.” Put simply, Zappos creates authentic connections and delivers enriched content.
Business leaders must always adapt to technology, and this is particularly true when it comes to harnessing the power of the Internet. In the earliest iterations, many companies simply gobbled up Web addresses and developed pages that served as little more than online brochures. To get a sense of the evolution of Internet brand presentation and interactivity, one need only explore the “way back machine” (www.waybackmachine.org), a historical archive of 150 billion Web pages dating back to 1996.
Dial-up connections gave way to broadband, and Web 2.0 opened up the world to applications that enabled a shift from static Web pages to dynamic and shareable content and social networking. While many people knew they “had to” dive into the new media, some companies failed to understand how to benefit from rapidly advancing technology. Not so for Zappos!
Some businesses’ foray into social media reflected traditional marketing, advertising, or “selling” approaches. By contrast, Zappos understood that social networking was just one more way (and a rather inexpensive one at that) to build and maintain relationships with customers and noncustomers alike. C. B. Whittemore, chief simplifier of Simple Marketing Now, notes, “Rather than using social media tools to sell products, Zappos deliberately uses them to … connect on a more personal level with both employees and customers. … Mind you, this is the company that considers the telephone to be the best social media. … At Zappos the liberal use of social media facilitates the network that links employees with one another and with the company’s customers.”
A website that is at the center of the social media phenomenon, Mashable, suggests that “Zappos has set the bar for social media customer service. Its approach focuses on making authentic connections via social networks rather than selling or promoting products. … CEO Tony Hsieh recognizes that the Web gives everyone a voice—including Zappos customers—and what customers say on blogs and social networks can reach millions. That’s why Zappos treats every interaction as an opportunity … to shed positive light on the brand. Staff are encouraged to be transparent in their tweets, which helps make customers feel like they know them and can be comfortable reaching out. The interaction is authentic, leaving the customer satisfied and likely to tell others about the experience.” Rather than communicating only through Tony Hsieh’s Twitter account (@zappos), the company’s personality comes through in the Twitter messages of Zappos employees on their own personal accounts. To see what Zapponians are tweeting about, you can go to http://twitter.zappos.com/employee_tweets.
When someone outside of Zappos tweets about the company (for example, a mention of where Zappos ranks in the Fortune Best Places to Work survey), it is common to see a number of Zappos employees spontaneously engage in a discussion about that tweet. If a tweet involves a customer service issue or question, the Zappos leadership has assigned staff members from the CLT resource desk to be available 24 hours a day to respond through the @Zappos_Service Twitter account. CLT members who are on “Twitter duty” address hundreds of customer questions daily. The spontaneous Twitter posts of Zapponians and the immediate personal nature of customer-service Twitter answers and interactions demonstrate how effectively Zappos leverages social media to parallel the personal connections created when customers call the Zappos CLT or engage its customers through live chat.
From a blogging perspective, the Zappos.com home page has a blog link that takes customers to a wide variety of product or Zappos culture blog pages, as well as to the Zappos Facebook page. Videos capturing the Zappos culture are often posted on the Zappos Family blogs and then uploaded to a variety of Zappos YouTube channels.
Graham Kahr, a social engagement scientist at Zappos, explains how Zapponians integrate and engage social media: “If there’s a video that my team makes at Zappos and I think it is sincerely funny, I’ll put it on my Twitter account, but if it’s something that I don’t think is going to appeal to my followers, then I won’t tweet it. Before I post anything on Twitter, I think about my posts exactly as I think about talking in public. At Zappos, hundreds of our staff members are on Twitter and looking at it in a pretty similar manner. If we wouldn’t say it in front of everybody, we probably shouldn’t tweet it. When a company treats you well and trusts you to act responsibly, people step up and communicate both honestly and respectfully.”
Graham’s comments highlight the understanding at Zappos that social media needs to be “raw,” authentic, and responsible, without the hype, polish, and extravagance of produced advertisements. Some well-established brands have struggled to appreciate the organic and honest nature of social media and have attempted to control the conversation, and at times, their efforts have backfired. One of the classic examples of this miscalculation was the “Wal-Marting Across America” fake blog (or what is sometimes referred to as a “flog”), which featured the very Wal-Mart-friendly writings of a couple, Jim and Laura, who purportedly crossed the country in an RV. Amid speculation that Jim and Laura weren’t real people, BusinessWeek.com provided a series of exposés about the blog. Those articles identified Laura as Laura St. Claire, a freelance writer, and Jim as Jim Thresher, a staff photographer at the Washington Post—both of whom had been compensated by Wal-Mart for the blog. Unlike messages delivered through traditional advertising, the social media attract an audience of individuals who are looking for genuine and unpaid opinions. In essence, they are looking for transparency.
Transparency fits well with the Zappos core value of “build open and honest relationships with communication,” and the Zappos “fun and weirdness” culture plays well in the context of social media. At Open Mic, the SAS Publishing Blog, Bernie Brennan and Lori Schafer suggest, “Social media is ingrained into the Zappos culture. Zappos believes they don’t even need a social media strategy—after the employees constantly post videos, tweet, and blog about their culture—they don’t direct sell or market. Visit the Zappos.com Family Blogs, its YouTube channel, or its Facebook page, and you will be entertained for hours watching videos of employees engaging in activities such as the ‘Crazy Fat Sandwich Eating Contest,’ Halloween at Zappos, as well as more serious Fashion Culture and Cause videos.” Social media is definitely personal, and the Zappos penchant for weirdness translates well through short, authentic tweets and highly energized and playful videos.
Given the visual nature of the Internet, Zappos has made a sizable commitment to providing enriched video content, not only of its brand in action, but of its products as well. In Chapter 4, we examined how Zappos helps customers make informed choices through rich photographic displays. While this is a more than sufficient approach to product depiction, Zappos seized the opportunities presented in a Web 2.0 environment to integrate videos that showcase products and forge connections with customers. The early adoption of video product depiction at Zappos is a story of STRETCH on two levels—how the Zappos staff members innovated video product presentations and how Zappos is changing the future of online product display.
To sample a Zappos Family music video, go to zappified.com/mvid or point your QR reader at the image given here.
Jason Lee Menard, video production manager at Zappos, highlights the inauspicious start of Zappos product videos: “I worked at the Headquarters in Vegas. I was on the fashion team, writing content for the product descriptions and for brand pages. I’d graduated from college with a communications degree and completed a lot of video classes. About a year into my working here, the manager of the content team asked me to make 10 samples of how I envisioned a product video looking. I was given full creative control. My manager showed the samples to Tony, Alfred, and Fred, and I was told they liked them. In less than two weeks, they gave me the title of lead video content coordinator. I was a one-man operation, making six videos a month in a little room with no professional lighting, a janky camera, and an improvised sound boom—a microphone attached to a broomstick.”
From that makeshift start, the Zappos video team now is located at the Fulfillment Centers in Kentucky, where it is actively involved in shooting short product videos. Essentially, a Zappos.com user who clicks on the site has the opportunity to see a rich array of photos of the products, and on many of the pages, the user can also watch a video hosted by a Zapponian. The Zappos staff member goes over the product description, adds insights beyond the attributes of the product, and usually models the use or wear of the item. Jason notes, “These videos allow the personality of our staff members and our culture to shine through, which was the original concept of the videos. In a minute or less, we want to show the product, make a connection with our staff’s personality, and share our culture. The videos should enhance the personal connection with customers through our human presentation of the product.”
Given that it takes considerable effort, staff involvement, and money to create product videos, one has to ask, “Are they working? Are they having the desired impact?” According to Jason, “We’ve gotten a lot of positive feedback. We conducted a user experience test where we brought in professional models to demo the products and compared that to our own staff presentations. For the most part, our users seriously disliked the models because they felt they couldn’t relate to them. We got a lot of feedback on our people, noting ‘how down to earth’ they are or how they ‘could be living next door.’” Jason notes that the “realness” of people from Zappos talking about the products parallels what is naturally occurring in social media. “Just look at YouTube. People get a new pair of shoes and share a video about them. People can relate to that because it’s the stuff of life.” Realness and the compelling nature of the product videos led Zappos to expand Jason’s one-man video production efforts, which could create six videos a month, to a team of approximately 20 videographers, video hosts, editors, and other staff members producing more than 50,000 videos a year. This aggressive approach to online streaming content is stretching the e-retail industry. While product video use isn’t new, it is still in the formative stages. Acceptance has certainly increased, as business owners appreciate the higher conversion rates they enjoy when shoppers view a product video. But as retail video expert Mark R. Robertson adds, “What has proven most interesting is the fact that even those shoppers who do not watch the video are converting at a significantly higher rate than those viewing the same product page without the option for video viewing,”
Zappos is converting product videos into sales while making emotional connections through those videos. Zappos understands that video, like all other content shared on- or offline, must be crafted in a high-quality manner. The material must be well produced but not overly polished. It must also be relevant, engaging, and consistent with overall brand standards. Unlike traditional advertising, the new visual media call for a sense of spontaneity, intimacy, and unabashed candor.
Zappos has achieved maximized returns from its commitment to social media and the production of enriched, high-quality online content. By involving its staff members in genuine conversations through Twitter, blogging, fun Zappos culture videos, and personal product content, Zappos has created a highly benchmarkable social media leadership position that social media expert Jeff Bullas reports delivers the following list of online results:
Its employees create a good deal of internal Web links.
It raises the Google page rank.
It enables a customer service forum.
It accelerates public relations.
It promotes branding.
It provides a search engine attraction platform, creating magnets for search engine activity.”
Who would not want that set of outcomes from a social media strategy? In the end, as with many other aspects of Zappos, these benefits come less from strategy and more from authentically connecting and enriching human experiences. As Zappos social engagement scientist Graham Kahr notes, “We are just people looking to connect with other people across the range of human experiences. Sometimes those connections involve offering helpful information, and other times it’s doing a poll about favorite cartoon characters. That’s not a strategy. That’s being fully human.”
Lest you think that Zappos can do no wrong when it comes to its use of technology, some efforts by Zappos to engage customers have met with controversy. For example, the Wall Street Journal and other publications have raised questions about a strategy that Zappos and many other online retailers use called “behavioral targeting.” Meghan Keane, U.S. editor of Econsultancy, notes, “Zappos knows what you did last summer. Or maybe what you did last time you were on the Zappos website. The shoe seller is just one of many companies that tracks customer activity online to serve more relevant advertising. Such tools have the ability to make product searches much easier online. But they also creep some people out. … Zappos ads are so smart that they remember past searches and offer similar product images to consumers as they surf the Web. For instance, if you go on Zappos searching for black patent pumps, Zappos will then taunt you on various websites with ads featuring glittering heels you probably shouldn’t be purchasing right now (not that I know this from personal experience).” The use of behavioral targeting by Zappos is consistent with a “do more with less” approach to online marketing. According to Darrin Shamo, director of online marketing for Zappos, “We wanted to provide value to consumers given the constraints of the medium and do it in the most efficient way possible. Personalized retargeting was driven from this idea and the feeling that if users are going to be exposed to display advertising, it should be both relevant and easily controlled.” Rather than spending money to position advertising in places that it hopes its customers will visit, Zappos took specific items that are of interest to a customer and placed them in the places the customer was actually viewing.
Michael Learmonth, writing in AdAge, indicates, “I abandoned [a Zappos] search [for a pair of shorts] and did something else. That’s when the weirdness started. In the five days since, those recommendations have been appearing just about everywhere I’ve been on the Web, including MSNBC, Salon, CNN.com and The Guardian. The ad scrolls through my Zappos recommendations. … At this point I’ve started to actually think I never really have to go back to Zappos to buy the shorts—no need, they’re following me.”
While other companies use the same technologies, commentators like Meghan caution, “Zappos is testing the limits of targeting with these ads. The company isn’t using particularly personal information in these ads. And it has been sending similarly personalized e-mails for a while. … A strong argument for behaviorally targeted ads online is that more relevant ads are better for consumers and brands. But what if consumers don’t want personalized ads—even when they are relevant?” Twitter posts about this practice suggest mixed results for Zappos. Here are a couple of representative examples:
@grumpymartian
I have to admit the Zappos ads that are targeted directly at me relating to what I’ve looked at on their site previously freak me out a bit.
I am so tempted. Sites like Zappos have banner ads with items that I barely resisted buying the first time. What the heck, where’s my card?
Clearly not every effort at “stretching” will be well received, and the jury is still out on the acceptability of behavioral targeting among Zappos customers. Based on consumers’ initial privacy concerns, Zappos has placed a link on the banner ads that says, “Why are you being shown this banner?” and it offers customers an opt-out option to prevent behaviorally targeted ads. The director of online marketing at Zappos, Darrin Shamo, notes, “We had a rough start, as we quickly learned that some users felt strongly opposed to these ads. Given our user feedback, we realized that we needed to work quickly to either resolve these concerns through optimization or discontinue this particular vehicle altogether. Since these ads are cookie-based and all inventory is purchased in real time, with no data being passed to publishers, our challenge was with a privacy perception issue rather than an actual privacy violation. Unfortunately, this vehicle was so nuanced and new within the industry that our only means of solving this issue was through education.”
Great brands continually listen to their customers, educate them, and make course corrections that are consistent with the company’s core essence. Those brands understand the limits of the permission that their customers extend and even the areas of need that their customers want them to fill. That permission or brand elasticity is finite. Brands that overstretch or reach beyond what is authentic or honest break!
Chapter 9 Ideas to Run With
From the outset, brand positioning should allow ample elasticity of concept, service, and product.
In addition to broadening product arrays, expertise in business can become a product line in and of itself.
Brands can stretch their social media effectiveness if they understand that the new media provide an opportunity to maintain and enhance relationships with customers and noncustomers alike.
Effectiveness in social media depends upon prioritizing communication, connection, and authenticity.
Overt selling, controlling the message, and poor-quality presentation are trouble zones in new media.
Businesses that are effective in social media have encouraged their staff members to authentically and responsibly engage their followers in discussions about their company.
Well-produced product videos can add a personal dimension to item presentation.
Product videos enhance sales conversion even when they are not viewed.
If you overstretch your brand, customers will provide feedback when you need to change course.
If you fail to heed your customers’ feedback on overstretching, the elasticity of your brand will snap!