At this point, you’d have to be under a rock not to have heard the news. Amazon bought Zappos for $807 million in Amazon stock, plus about $40 million in cash and restricted stock.
The real question, though, is why are we all so surprised? Both companies are at the top of virtually anybody’s list in customer service, with a fiercely loyal base of repeat customers. They’re both online retailers who emphasize value in offering the broadest selection of quality products. They’re both innovative and dynamic businesses that value their employees and customers foremost, inevitably leading to value for their investors and shareholders.
Oh, and when it comes to ease of site navigation, shipping (free at Zappos; free at Amazon for purchases $25 or above and free for members of Amazon Prime), return policies, and pretty much everything having to do with brand experience, they excel. They arguably set the standard for anyone else, whether online or brick and mortar, and regularly raise the bar on themselves.
Besides making customer satisfaction a key purpose of any business transaction, both Amazon and Zappos demonstrate a keen appreciation for engagement of their customers. Both retailers offer the opportunity for buyers to share their experiences with product purchases. These days, most marketers realize that customer feedback mechanisms, including product reviews, are critical to a shopper whose purchase decision is heavily influenced by peers, friends, and the experience and recommendations of other buyers – whether good or bad.
To its credit, while Amazon acts as a virtual hub for independent merchants and small businesses to promote their wares online, even those businesses are subject to customers’ rating of their experience with products purchased and fulfilled outside of Amazon. So in effect, Amazon protects and preserves its brand reputation and credibility as putting customers first, even when third-party sellers on its site disappoint buyers with a lame experience.
Not to be outdone, Zappos takes pride in delighting its customers, period. Stories abound of customers receiving free – and unexpected – overnight delivery, leaving a glowing impression of the purchase experience, and ultimately the Zappos brand (full disclosure: it’s happened to me twice). I spoke with a Zappos customer service specialist who was disarmingly pleasant and enthusiastic in her role, and who wisely advised me on the generous sizing of a particular shoe style I was ordering based on prior customers’ experience with this product. She was dead right about the fit, and I’ve never forgotten the call. I’ve retold the story hundreds of times. Oh, and I ended up returning the shoes… which seems insignificant, and thus often forgotten. Yet the part about overnight delivery and free return? That part I remember. It’s what brings me back again and again.
When it comes to customer engagement via social media channels, these two brands truly get it. Amazon has multiple Twitter feeds announcing everything from daily deals, free music downloads, special sales, coupons, to books and more (such as @amazonmp3, @kindlenews and @AmazonBookClub feeds, to @amazongames). It even boasts an unofficial consumer feed promoting products on its behalf (@AmazonHotDeal). How’s that for social media evangelizing?
Similarly, Zappos CEO Tony Hsieh (@Zappos) is a popular Twitter user, and has managed to not only attract more than a million followers of his frequent, insightful, down-to-earth, and often funny tweets, but he’s made communication via Twitter and SM pervasive to Zappos’ culture among his staff (including the COO’s @zappos_alfred, @Zappos_Service, @Zappos_Pipeline, @zappos_helpdesk, @Zappos_Tweetup, and even @zappos_spouse and @ZapposFans).
The distinguishing quality about both Amazon and Zappos as brands is that the customer almost always wins. So ultimately, what’s most surprising is that this partnership didn’t happen even sooner. Or that it caught so many off-guard. Either way, something tells me this online retail hook-up is just the beginning of a wonderful union, for better, and for richer — for both brands, and their growing world of customers.
I have a confession: I’m a frequent traveler. By choice. Even in these days of predictable flight delays; baggage handling snafus; charges for in-flight meals, snacks, and pillows even; and endless waits in long lines on the tarmac while flights takeoff or disembark passengers.
I make regular trips to the nation’s capital at least nine times a year. That’s a round trip air ticket, plus rental car for each visit (I’ve travelled to Washington, DC, twice within the past three weeks). I’m a pretty regular customer for anyone whose paying attention.
Hertz is. Every time I bid on Priceline for a rental car at the airport in Washington Dulles, I get a nearly instantaneous reply from Hertz accepting my offer, virtually regardless of the amount bid. It’s turned me from an Enterprise-by-choice to a Hertz-by-choice customer. Not bad, considering how often I rent cars, including during holidays when they charge a premium.
I noted recently that Hertz’s Connect service offers hourly rentals in NY with rates as low as $8.50/hour, ala Zipcar and other competitors. Smart move, considering more and more consumers are reducing their carbon footprint through less reliance on cars, among other promising energy trends. For this, I applaud Hertz. Some brands get it. When the marketplace changes, and it always does, it’s critical to remain relevant and customer-focused. Innovation is essential, especially these days.
Which is what makes me particularly baffled by the recent experience I had with Delta. Besides DC, I book at least another 5-6 trips annually; double that if you count travel by car. Recently, I bought round-trip air tickets on the Delta.com Website for the upcoming July 4th weekend. Only three days later, the fare was reduced by $100 total. On Orbitz and countless travel sites, for some time now, they guarantee your purchase at the lowest rate. They want to ensure you’re a satisfied customer; and they definitely want to provide a compelling reason for you to return and use their site again the next time you’re booking travel. It’s a pretty simple formula for creating brand loyalty. What part of it does Delta not understand?
One might expect, as a customer, that you’d receive better treatment and select benefits by booking directly via a company’s Website over an aggregator site intended to sort and compare competing travel offers and rates by emphasizing lowest fees. It’s a market opportunity for airline brands to differentiate themselves and offer consumers advantages for choosing their brand over other options. Jet Blue gets it. They actually charge a $15 fee for booking on a site other than theirs. They also charge nothing to have an existing ticket re-issued at a lower available fare.
And like Hertz, Jet Blue is an innovator. Their Jet Blue Promise Program is a policy that refunds flights or vacation packages in full to anyone whose been laid off recently since making travel plans. How’s that for counteracting the “uncertain” for those unfortunate enough to experience difficulty during these uncertain times. You can call it recession marketing, as some have. Or, I prefer to attribute it to Jet Blue’s exceptional customer focus, which has always been core to its brand experience.
Despite the economic downturn, I’m planning to keep up my aggressive travel and flight schedule. I figure I’m a catch, and a keeper, by anyone’s standards for customers these days. I think I’ll pass on Delta from now on. Jet Blue…or anyone else, are you listening?
What Have You Done for Me Lately?
A recent study from Forrester Research confirms what most would presume to be true: a business’s customer experience is often closely linked with its brand loyalty.
Customer experience was evaluated based on usefulness, ease of use, and enjoyability. Not surprisingly, customer experience strongly correlated (in most cases) with buying more products or services from the company, a likelihood of recommending the company to others, and the reluctance to switch to competitors.
Apple, Amazon, Canon, The Wynn Hotel. These are just a few of the brands that consistently deliver delightful customer experiences for me. They all had me at “hello.” For some, I’ll pay a higher price without question and without any consideration of alternatives. For others, they’re my first and often only resource for online purchases. For still others, I rarely fail to respond or commit to whatever promotional offer they send my way.
It seems so obvious, but too often we forget that the main reason for being in business is for your customers. If you’re not prioritizing them, improving your services and products for them, and engaging them in your continued development and refinement of such… someone else will.
More importantly, as nearly every product or service is commoditized over time — particularly in this economy, it’s a customer’s experience with your brand that can often be your most significant differentiator. It can either make or break your relationship with customers. And it can be the game-changer for your entire sector (i.e., see “coffee”).
What have you done to delight your customers lately?