The New Importance of Customer Service As A Business Model

Last week, Tony Hsieh, CEO of Zappos .com, gave a record PSAMA luncheon audience of over 300 attendees an inside look at his own company’s approach to customer service, and says there is no doubt in his mind that “Delivering Happiness” (his description of customer service) is, indeed, a route to building a long term sustainable business.

Based on his New York Times bestselling book, Delivering Happiness: A Path to Profits, Passion and Purpose, Tony shared his philosophy on why customer service and delivering the best customer experience for customers, employees and vendor partners can pay dividends. After all, he sold Zappos to Amazon last year for over $900 million.

But Tony is quick to stress that delivering a WOW customer experience is about much more than financial success. It’s about personal fulfillment and pride. It’s about having a passion for your job that builds a fierce loyalty to do the right thing every time. And it’s about having a company culture that strives to make every person in the company feel that they are part of something bigger than selling shoes. Happiness is a framework for business that can produce profits, passion and purpose both in business and in life.

At Zappos, they let their customers do their marketing for them.
Tony describes the Zappos approach to business this way, “at the end of the day, we aren’t in the selling shoes online business, we are in the stories and memories business. If we can create a WOW customer experience every time someone interacts with our brand, then those customers become our best marketing effort.”

To create and sustain that WOW experience, Zappos constantly asks these important questions:

1. What do customers expect?
2. What do customers actually experience?
3. What emotions do customers feel?
4. What stories do they tell their friends about us?
   

Answers to those questions led the way for Zappos to offer free shipping both ways and a 365-day return policy. It’s also why their website features a 1-800 number at the top of every page on the site. Tony says “we want our customers to talk to us, so we can build a relationship with them and better serve their needs”.

At Zappos, the telephone is their number one branding device.
A big part of the Zappos experience involves interaction with customers on the telephone. To make each call a special experience, there are no rules, no pre-set scripts, and no attempts to make calls more efficient by limiting the amount of time a call center employee spends on the line with the customer.

Zappos wants their customers to say “wow” when they get off the phone”. Tony offered several anecdotes on call center efforts to deliver that special experience to their customers, including a very funny story involving a 3:00 AM desire for pizza and the Zappos call center employee who took it upon themselves to find open pizza restaurants that would deliver at that hour. How many of your employees would go out of their way to satisfy a customer to that extent?

If we get our culture right, the WOW customer experience will follow.
Tony stressed more than once that company culture is the number one priority at Zappos. Their attention to maintaining a consistent culture begins with the employee interview process, which involves two separate interviews – one to determine skill set and a second interview to determine the cultural fit. They also offer five weeks of training before anyone is allowed to interact with a customer, so that everyone is on board with the core values of the company and how to express those core values to customers.

Tony related an interesting twist to their employee hiring process. Midway through the training period, employees are offered a $4,000 bonus to quit. That’s right. They will pay you to quit on the belief that if you are only working for the money, it’s unlikely you will be a good fit with the company culture.

Other culture builders include an annual “culture book” where employees are allowed to provide unedited comments on how they are “delivering happiness” in their own departments. And they also use Twitter to provide an opportunity for employees to get to know each other better and to share their experiences.


As he concluded his talk, Tony re-emphasized his belief that a strong, high touch customer service experience was a successful business strategy. But he also stressed that his message was not to adopt the same core values as Zappos in order to be successful. But rather, it was to say that it doesn’t matter what your core values are as long as you commit to them. That’s the real secret for business success.

So what does customer service and delivering happiness have to do with new business prospecting? Everything if you believe that the future of the agency business is a partnership with clients to help them build a relationship between their customers and their brands. Clients aren't looking for someone to do a new ad for them. They are looking for help. Smart agencies should know that help comes in many forms.

At Zappos, their secret to long term success is to deliver happiness through the best possible customer experience. What’s your agency's secret? Or is it a secret?