Whether catering to consumers, brand partners, employees or the community, footwear and apparel retailer Zappos is leaning on experiences as an engagement tool.
In a presentation during the CEO Summit on Aug. 3, Zappos CEO Scott Schaefer detailed the four E’s that are driving the company’s growth strategy: experiences, efficiencies, energy and each other.
“What we’ve been embracing at Zappos is something that we’ve developed in response to quickly changing industry, competitive landscape, customer needs, and really, what are the unique strengths that Zappos can deliver,” Schaefer said. He added, “This is how we’ve been thinking about our time, our energy, our dollar investments.”
In an example of its experiential strategy, Zappos sponsored the Bay to Breakers race in San Francisco and turned the mile markers into “moments that made you laugh,” like a unicorn dance party. Those who crossed the finish line got a “golden ticket” that allowed them to get a new pair of shoes from Brooks.
“We’re focused on delivering wow experiences to our customers,” Schaefer said. “We want to deliver fun, but also storytelling, and that’s really the big difference—the storytelling that can happen both online and through physical touchpoints.”
Experiences also come through product assortment. As part of its merchandising strategy, Zappos has sought out exclusives, such as a recent Crocs line celebrating the movie “Clueless.” The collection of shoes and Jibbitz inspired by the film’s characters was a hit, with two of the four styles selling out within the launch week.
Zappos also makes a point to listen to its customers’ feedback and needs. A grandmother called about shoes with hook-and-loop closures for her grandson who has autism; the pair that Zappos carried did not come in his size. This customer service interaction led the retailer to find a solution. After researching and talking with individuals with disabilities and their families, the retailer launched Zappos Adaptive in 2014. At the start, there were just two brand partners, but today this selection has grown to include more than 20 brands, including Reebok and Sorel. Zappos also sponsored the Special Olympics USA Games and created inclusive merchandise and on-site activations like a giant piano and a bubble party.
Serving up “wow” experiences also informs Zappos’ prioritization on investments and process optimization. One of the retailer’s efficiency efforts is using more of parent company Amazon’s fulfillment logistics to allow for better proximity to the end consumer, increasing speed while cutting down costs. “Everyone knows speed matters,” Schaefer said. Zappos is also leveraging placement and integrations during peak times on Amazon—such as Prime Day—to get in front of customers and brand build.
The third E is energy, which involves “passion, collaboration and experimentation.” One of the ways to infuse this energy is new talent. Earlier this year, Zappos hired its first chief marketing officer, Ginny McCormick, who worked in the toy world at Hasbro and Funko, and was most recently at Amazon Hub. Another recent hire is Joe Cano, chief merchandising officer, whose prior experience includes Walmart.
Energy allows Zappos to create solutions to benefit customers. Giving an example, Schaefer mentioned Zappos at Work, a B2B2C solution that creates a portal for companies’ employees to buy safety apparel and footwear they need for their jobs. What began as a pilot program has expanded and is now among “the fastest growing, successful elements of the business,” he said. One product area that Zappos has focused on is offering a wider range of safety designs for women, who are consistently becoming a greater portion of individuals in trade professions. In the most recent quarter, Zappos introduced more than 30 new styles for women that were collaboratively designed by its merchandising team with the brands.
Zappos considers its employees among its “customers,” along with consumers and brand partners. Its workforce informs its final E: each other. One of Zappos’ core values is to create a “positive team and family spirit.”
Following pandemic relocations and remote hires, Zappos has had to rethink some of its company activities to include employees who are not based in Las Vegas. For instance, a picnic was held remotely by sending backpacks with goodies to employees’ doors. Schaefer said initiatives like team-building should start at the team level, rather than being led by the top down.
“We’ve been able to keep our culture thriving through what was completely remote model to now a hybrid model all through creating these organic moments together, but really moving to a smaller scale,” he said.
