Practical Ecommerce

The Zappos Effect: 5 Great Customer Service Ideas for Smaller Businesses

Zappos, the online retailer, has used incredible customer service to create an extremely loyal customer base. Small ecommerce businesses that want to grow would be wise to take a lesson from Zappos.

As an example of Zappos’ almost insane customer care, the company has even been known to shop at other stores for customers.

In 2009, a traveler checked into the Mandalay Bay Hotel and Casino in Las Vegas, Nevada. When the traveler was unpacking she realized that she’d forgotten a pair of her favorite shoes. She had purchased the missing shoes at Zappos, so she headed to its website. When she could not find another pair of the same shoes on the site, she called the company’s help-desk concierge service. Zappos no longer had the shoes, but its headquarters are just outside of Las Vegas. So the Zappos team located the shoes at a nearby mall, went there and purchased the shoes, and then hand-delivered them to the Mandalay Bay, all at no charge.

This act of customer service heroism certainly sounds crazy. It almost certainly cost Zappos money. So why is this one of the secrets to online retail success? To get the answer just imagine how the customer felt. No doubt, she’ll shop Zappos again. She probably told lots of friends, who told their friends. And the goodwill that the company generated most certainly did more for the business than any advertising or marketing program Zappos might have spent those dollars on.

The only real question is what can a small ecommerce business do to delight customers in a manner similar to what Zappos does?

Lightning Fast Response

Many large businesses do not reply to customer emails. This sort of response won’t fly in a customer-focused ecommerce business. Do your best to provide lighting fast responses to customer questions, comments, or orders.

Many small merchants cannot easily afford a call center, so they rely on email as the only means of customer communication. This is fine, as long as you get right back to the customer. Consider keeping your customer service inbox open all day when you’re sitting at your desk. When an email comes in, treat it like a fire alarm. Also, after hours, have a means of monitoring customer service emails from your smartphone.

Define what lighting fast response means in your company — perhaps five minutes or less — and track your response times. You want to get back to every customer before that customer starts wondering what’s going on.

Never Argue About Returns

Zappos has a 100 percent satisfaction guaranteed return policy. The company will never fuss about any return. In fact, Zappos actually encourages customers to order several products, check them out, and return what they don’t want. Here’s a Zappos-produced video on the company’s return policy.

Consider implementing a similar policy. It will make customers feel more comfortable buying from you, and if your ecommerce platform will support it, consider offering the refund in the form of store credit.

Treat Good Customers Well

Another Zappos customer service tactic that translates well to small online retailers is the concept of treating loyal or new customers well. Specifically, Zappos often upgrades good customers to next day or second day air shipping from standard ground shipping. This policy encourages customers and rewards those customers that frequently shop your store.

You might also consider offering coupons or other bonuses to your best customers.

Expect Problems, Be a Solution

Next, expect problems. Remember, you’re selling products via mail, often on images alone. Lots of things could go wrong, from shipping problems to the customer ordering the wrong size.

Knowing that there will be problems, you should be prepared to handle them when they come. If a certain type of problem — perhaps packages damaged during shipping or something similar — be sure to take some action to prevent this sort of problem in the future.

Customers that have had problems and believe they were treated fairly will often be your most loyal customers in the long run.

Treat Customers Like Individuals

Finally, learn to treat every customer like an individual with a unique story, challenge or problem. Imagine what you would do if a customer called you and said she had forgotten to pack her favorite pair of shoes.

Armando Roggio
Armando Roggio
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Comments ( 7 )

  1. Massimo Arrigoni March 22, 2011 Reply

    Armando, good article. I’m a big fan of Zappos, I’ve read "Delivering Happiness" more than once, and there is no doubt that good customer service is the one thing that any business – regardless of size – can use to set itself apart.

    One thing on the first item (Lightning Fast Response): I believe it makes sense to consider Live Chat. There are tons of easy to use tools out there (at Early Impact we use Olark.com).

    My recommendation to merchants is to at least try: you can always remove it.

    As a consumer, I use Live Chat all the time when I’m shopping online. Your customers might too :-)

  2. Armando Roggio March 22, 2011 Reply

    Thanks Massimo.

  3. altteam March 24, 2011 Reply

    Really interesting article ) I like the live example with the shoes.
    I entirely agree with the fact that if you as a customer were treated well you will return. It’s a psychology. Everybody likes to feel needed and considered person.

  4. John Lindberg March 24, 2011 Reply

    I always like reading your articles Armando…excellent content.

    An important key to upgrading a webstore’s return policy is use of the various special return processing services offered by USPS, FedEx and UPS.

    At my company, we use the UPS Flexible Access service plan which is described at [http://flexibleaccess.ups.com](http://flexibleaccess.ups.com).

    This system allows the merchant to send a UPS shipping label to the customer by email and the customer can simply place the return package in their mailbox.

    We have found this technology to both improve the shopping experience for the customer and help keep the return processing cost affordable.

    John Lindberg – President
    EFULFILLMENT SERVICE INC

  5. James March 30, 2011 Reply

    Must have missed this post in my reader.

    Also a huge fan of Zappos, in fact if you look at the blog on my website I made a post about them a week ago!

    We try to follow in zappos footsteps wherever we can, just like you said about emails, I always make sure I get back to them right away, be as personal as possible. Although, I something think this may give not such a good impression in the sense that people will think we are a small company, and desperate for their custom. Maybe overthinking things!

    Top post

    James

  6. Elizabeth Ball April 5, 2011 Reply

    The "expect problems, be a solution" idea is applicable to all size businesses.
    In fact you could probably have a fun brainstorming morning with your customer service, marketing, IT and operations staff working out potential issues and at least three ways to solve them.

  7. mani September 12, 2014 Reply

    Nice article Armando! I really liked the story of excellent customer service (kind of hard to believe that a company could do such a thing).

    Also, the points that you have raised are really helpful. I guess live chats could also be very effective.

    thanks :)

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