Five Questions for Zappos CEO: Tony Hsieh

Tony Hsieh, CEO of online retailer Zappos.com was kind enough to debut a new feature on Black Match. Five questions for a CEO. For those under rocks, they sell shoes.

1)   What advantages for the Zappos brand come from being so accessible and  transparent across social/digital platforms?

At Zappos, our #1 priority is our company culture. Our belief is that if
we get the culture right, most of the other stuff, like delivering great
customer service or building a long term enduring brand, will happen
naturally on its own. We’ve formalized the definition of our culture into
10 core values:

Being transparent isn’t really something that’s specific to social/digital
platforms. Core value #6 is “Build Open and Honest Relationships With
Communication”… It’s just part of who we are.

2)   As a company that has famously avoided broadcast advertising in favor
of “actions” that advertise (i.e. free shipping) what was the trigger point for your recent ad campaign? How are you/will you measure success (i.e. sales only)?

We take most of the money we would have spent on paid advertising and
invest it into the customer experience instead.  However, we do spend as
much money on direct marketing as possible when it pays for itself.
Using hypothetical numbers, this means that if we spend $1 on paid
advertising, if we get back $10 in sales, then we will spend as much money
as possible as long as we continue to hit that ratio. The problem is that
there isn’t enough advertising inventory out there that meets that ratio.
What we found was that if we invest some money in offline brand
advertising such as magazine ads or TV ads, then that improves the ROI of
our online campaigns, so that altogether we are still hitting the ratio
that makes sense for us.

3)   Is there an overall strategy for your participation in digital/social media or has it come about organically?

It’s really been organic. We aren’t really about “digital/social media” (a
term which I personally dislike). We’re really just about figuring out
ways where we can best express our core values (our culture) and our
commitment to great customer service. We’ve found that Twitter has been
great for that, but so has the telephone, which is why we put our 1-800
number at the top of every page of our web site. The telephone isn’t very
newsworthy, but it’s one of our best branding devices.

4)   Has/How has the Zappos brand been challenged over the past 12 months?

I think the biggest challenge with building our brand is that Zappos is an
experiential brand. Anyone can start another web site tomorrow and make
the same claims that we do about delivering great customer service, but
it’s not until you actually purchase something from us, or call our 1-800
number, or visit our offices, that you can start to tell the difference
between another company and the Zappos brand and culture.

5)   There are obviously tricks that traditional retailers are stealing from you (I’m looking at you piperlime.com); are there dance moves you’re borrowing from traditional/brick and mortar retailers?

We really don’t focus very much on what other retailers are doing. We just
focus on what our customers and employees tell us and then try to deliver
the best customer experience possible while still meeting our financial
goals.

There are a number of interesting widgets that Zappos has in play, including this great Google/Zappos sales mash-up.

Filed under: brands, ceo, consumer choice, online advertising, recession, social media, supergenius llc, twitter, zappos , brand, ceo questions, consumer choice, digital, engagement, social media, strategy, tony hsieh, twitter, zappos

The Enduring Mythology of the “Name” Advertising Agency

The Enduring Mythology of the “Name” Advertising Agency

Nobody ever got fired for buying IBM. That’s the story. IBM was such an industry standard, and so widely perceived as being the best in the business, that no one could impugn you for making a decision based on that name alone.

Well, we all know that was a load of horse crap. Plenty of people got fired for buying IBM; IBM just had them quietly killed to preserve their word-of-mouth. But the temptation to buy something large, well-regarded, and safe is still with us. It’s how most of us buy (or bought, and will again) houses, cars, investment funds.

Oh, and by the way, advertising agencies.

That’s the funny part of this business. Agencies stake their name on their early campaigns that create edgy, breakthrough, back-of-a-napkin, two-guys-in-their-wetsuits campaigns that change a category and instantly make a name for themselves. Then those agencies get noticed, and get more business than the two guys in their wetsuits can handle. They get big. They hire people. They hire people to manage those people. And every level they add puts them further and further away from the ideas that made them great in the first place.

Here’s the ugly truth: big agencies get out of the idea business. They get into the selling-the-idea business. They stop feeling the idea and start thinking it to death. That’s why with every idea, you get a ream of paper explaining why the idea is not only good, it is also right. And they create an entire bureaucratic structure of planners, account service, creative and media to sell the idea to you, so you can sell it to your boss. Because nobody ever got fired for buying IBM.

Everyone who works at Super-Genius has worked at a big agency. We’ve made the sausage. We know what goes into one. And we were once seduced by the big names, too. We get it.

But we wanted to talk ideas without asking the admin assistant to schedule a pre-brief meeting in the staff room. We wanted to pick up the phone and talk to you. We wanted to be closer to the work and farther away from the smoke and mirrors we use to sell you the work.

Who knows? We might hire a bunch of people and sell out to Omnicom tomorrow.

But today? You’ve got two guys in wetsuits. Anything is possible.

Filed under: ad agency, advertising, brands, supergenius llc , Brontosaurus, content, creative, strategy, super genius, super genius llc

Do Brands Belong on Twitter?

Do Brands Belong on Twitter?

Thoughtful post via Mashable. Not sure I agree with the idea of banning brands – think it’s probably a case by case thing. But…do agree that forcing brands to put a human face on their Twitter interaction would better serve them in the long run.

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Filed under: brands, social networking, supergenius llc, twitter , bad brand behavior, social networking, twitter

Have You Seen My Avatar?

We here at Black Match have long been citizens of the virtual universe, now it seems the rest of the marketing world is catching on. Whether it’s working within a pre-existing universe like Second Life or creating a custom universe like MTV’s Laguna Beach, what’s hot at the moment is virtuality. Second Life is up to 400,000 users and counting – exchanging real money – and savvy media properties are angling for awareness among this concentrated but highly influential population. Look no further than this New York Times article for a quick bit of insight on how some very youth oriented properties like MTV are pushing the envelope.

“At MTV, reality has always been a moving target. Sixteen years ago, the network heralded the era of reality television with “The Real World.” Three years ago, it pushed the genre further with “Laguna Beach: The Real OC,” in which the mundane lives of a clique of pretty teenagers were presented in a way that appeared scripted and dramatic.

Now the cable channel aims to push the boundaries of false reality one step further. This week, MTV will introduce Virtual Laguna Beach, an online service in which fans of the program can immerse themselves — or at least can immerse digitized, three-dimensional characters, called avatars, that they control — in virtual versions of the show’s familiar seaside hangouts(see article).”

Filed under: brands, online advertising, social networking, supergenius llc , avatar, creative, interactive, social networking, super genius llc