Zappos Essay

2714 Words Sep 28th, 2013 11 Pages

Question 1: What are Zappos’ supply chain related core competencies and sources of competitive advantage? How sustainable are they? What role does corporate culture play in these questions?

Zappos consider themselves “a service company that happens to sell shoes”. The main core competency of the company is its customer service. Hsieh considered customer service to be one of the most important aspects of the business. If a business has excellent customer service, then customers are more likely to return to purchase from the business again. Hsieh saw that excelling in customer service and trusting the word of mouth of their customers would build up their customer base and their sales. A 24hour call centre and a toll-free
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This would keep the “WOW!” factor that Zappos are renowned for when the new customer receives a next day delivery package. Another suggestion would be to add a cost to the next day delivery, however as other companies already offer this service there would still be a much higher level of competition.
Case studies have revealed that during the economic downturn Zappos has been reaching its internal revenue targets continuing along its predicted growth trajectory. This means that sales are not the issue, as people will still buy things they need and want, maybe more cost consciously. The main findings for Zappos were that customers spent more time researching different competitor websites before ordering from Zappos. The solution to this could be to make the Zappos page more attention grabbing and informative in order to convince people to order straight from Zappos instead of researching competition.
Question 3: How would you expand the business? Would you add more products, more geographies, or by selling private labels. As you expand the business, how can the company become more profitable, particularly in light of the costs associated with the focus on service?

There is no real benefit to be gained for Zappos by expanding into foreign markets at this stage in their development. This is because, as is mentioned in the case study, the next biggest market is the European market which is in actual fact made up of

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