The Case of Zappos.com 2009
Introduction
Zappos.com, a privately-held online retailer of shoes, clothing and other soft line retail categories, learned that Amazon.com, a $19 billion multinational online retailer, was about to acquire it. Zappos started as a humble beginning in 1999, when less than even 1% of shoes were sold online. How did Zappos climbed the success ladder and become a company which Amazon would look to acquire allowing it to be independent subsidiary in Amazon is the case.The case evolves about the 3C’s that Zappos set for itself and that changes the story of Zappos in a span less than a decade.
Inspired by the low service level and variety of a shoe mall at San Francisco, Nick Swinmurn, a 26-year-old marketing manager
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They hired individuals to match the company’s culture and made sure that they maintained certain soft standards which were mentioned in their core Value set.
Customer Service: Zappos heavily relied on high quality customer service and made sure that the employees provided the same. They had special CLT members whose job was to provide answers to any doubt that a customer may have. They went to extraordinary lengths to satisfy the customer which included interacting with them for hours on unrelated topics. The back office job was equally important. They carousel and Kiva systems ensured that they were able to provide what was promised on time.
Clothes: Another major success factor was how Zappos was able to pull in close to 300 brands which offered shoes and clothes. This enabled them to provide whatever the customer was looking for. The employees at Zappos gave detailed explanation of the products on the site with photos from different angles. Zappos has a mission to provide all types of apparels to clothe a person from head to toe.
Evidences that supports the Zappos
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They had criteria’s which made hiring a bit more complex than other companies.
Hire for Service Competencies: At Zappos they concentrated on thing more than technical skills, they wanted people who would enjoy their work. They made happiness criteria for hiring, they required the applicant to be a person who is creative, happy and a little weird other than being technically sound.
Be the Preferred Employer: Zappos had created an environment in which the employees felt comfortable. They did not have any particular hard standard in place which made the working freer. To promote their work culture, they conducted work place tour for outsiders who included academics and business personnel’s. This helped spreading the work culture of Zappos.
Develop People To deliver Service Quality:
Train People: The people working the Las Vegas office were provided with 225 hour training session on the core values of the company in which learnt and taught others. The workers from the warehouse were trained different functions to increase
The Zappos believes employees, customers and their "happy" stakeholders. They have 10 core values that are at the heart of their culture and business models. Some of them are: build a positive team spirit and family spirit, create fun, a bit weird, communicate with the establishment of open and honest relationships, and provide WOW through the service.
Zappos has a very strong corporate culture. The core values of the business and its culture have a strong influence on all aspects of the business, including the company’s supply chain. Employee training and the hiring of the right employees were vital in growing and maintaining the current culture. Other competitive dimensions include the customer service training and employee development
If employees are not familiar with the company’s goals and what the company is expect from them they won’t be able to perform good. Successful organizational culture requires a team work. Johnson should establish the espoused values of the company. These are the stated values and norms that are preferred by the company (Kreitner, 2013, p.63). Johnson should set the basic assumption which values employees (Kreitner, 2013, p.65).
Case Analysis Disruptive Business Models Markides (2006) explains that disruptive business models are strategies implemented in a company which enables it to outshine the competitors in an individual market. The disruptive model focuses on distorting the existing market and making the customers prefer the new business as opposed to the others (Magretta, 2012). Disruptive business models may include offering higher discounts, after sales services and premium products. Such a model is often sudden, and it takes over the entire market which sometimes leaves the other market players disoriented. During this time, such a company takes advantage by acquiring massive customer following and ultimately more profits.
2.0 Introduction to Boots Boots UK Limited is a pharmacy chain operating in United Kingdom and Ireland which sells health and beauty products along with operating an optician service. It was first established in 1849 by John Boot, and was formerly known as ‘Boots the Chemist’. Boots ( the trading name of the company) has achieved many successes throughout its career that it can be called a very successful, pharmacy-led health and beauty company, despite its ups and downs which are going to be mentioned further in this assignment. Boots UK is officially branch of a multinational company, Alliance Boots GmbH which operates in over 25 countries around the world.(Boots-uk.com, n.d.) 3.0 Current Marketing Situation Boots is a member of Alliance
Victoria Secret was profitable enough in their first year, for the company to open four more physical locations, as well as a mail order catalogue. Although Roy Raymond’s policy was initially profitable, but as we will discuss in the later parts of this paper, it also had its downsides that almost led to the bankruptcy of Victoria Secret. Today, Victoria Secret is a multi billion dollar conglomerate with more than a thousand stores in more than 180 countries generating an annual income of over five billion. 2. PESTEL ANALYSIS The external environment of a company can affect everything from company policies, finances, sales, targeted customers and can be a deciding factor in whether the company remains for another season.
Also, feeding into the organic mouth marketing. They use fit models to test and give them a feedback. Lululemon had a manifesto which was created by Mr. Chip Wilson and his father.
For instance, the world population is aging (OECD, 2013a), therefore, changes in demographic may be dangerous to solely teenage-oriented apparel firms based on the fact that competition for that segment is gradually diminishing (e.g. Coneen by design ltd). Nevertheless, these could be an opportunity for open and more flexible existing fashion retailers. Nowadays, customers are demanding for convenient shopping experience due to limited time in accessing or going to the market in person. Therefore, fashion or clothing firms with quality and easy to navigate web page will attract more customer (Chaturvedi, Martich, Ruwadi & Ulker, 2013).
EXECUTIVE SUMMARY Zara can be identified as one of the largest international fast-fashion organizations which is owned by the fashion group Inditex. Their first store was opened in 1975 and from that point of time, they have had an unstoppable growth throughout the years as up to now. After 42 years of operations, today Zara has been able to expand themselves with 2169 stored over 82 countries all over the world. Rather than they were a high fashion brand in the country, Zara has focused themselves as a fast fashion brand where they will change their fashions at a great pace where no one can reach them. Also, the most attractive thing is that all those latest fashion designs are introduced to the public at an affordable price.
Inside the company, their organization structure is simple and employees work with high participation, so that the whole company runs efficiently. All above allow ZARA to provide products with lower price. ZARA has a flat organization structure, which emphasizes a decentralized decision making approach; The design team are relatively independent; Store managers have more responsibilities. Team structure is important for operating organization
On the other hand the fact that Zara produces the remaining 40% internally, is a strong asset, providing better control, and short lead-times. Finally the fact that Zara owns 450 workshops were garments are to be sewed is a major asset ensuring quality. Another important asset in terms of production, is the technologies involved, for instance the cutting machines, to minimize waste (Ferdows & co. 2014 p9), used in combination with the last-final hand-made sewing. The ease of the connection between the production center and the distribution center is also an important time-saver element, and therefore
For that reason, one of the world’s leading retail organisation Zara particularly focus on their organisational resources in order to get the competitive advantage over their competitors. Some of the key organisational resources of Zara are demonstrated below: Market-oriented Strategy However, in the retail industry the competition is very high that is why the customer is considered as a king for them and they have to make them loyal as much as they can for the reason that they will not move to other brands quickly. Moreover, by focussing on customer‘s requirement and likings, reinforced by its operational approaches and Zara shows their assurance towards their precious clients. For that reason the customers of Zara‘s are quite loyal that help them to reach better position in the market (Finney, et al., 2008).
Starting as just a mail-order business with some retailers, it quickly opened new manufacturing facilities, starting with New England in the early 1980s as well as it signed contracts with other international distributors. While producing at lower costs outside the US, New Balance sold its shoes at a higher price than the average market and started to have huge sales anyways. Moreover, what makes New Balance’s operation strategy unique is that they offer their shoes in multiple widths and always have inventory in case the retailers get out of stock. This supports directly two of New Balance’s main competitive objectives being first that they want their customers to feel uniquely served by offering several widths of their shoes for different kind of feet and letting the customer not wait for the delivery of the shoes but always having inventory to push into the retail stores in case of scarcity. A good customer experience is one of their key competitive
Furthermore, OB investigates the study of what people do in an organization as well as help them to recognize how their behaviors impact on the organization performance (Judge & Robbins, 2013). That the reasons why OB plays a significant role in business. More importantly, Mr. Hoang also instructs me how to apply the knowledge gained through this course for enhancing my personal development. The first valuable knowledge is that how to communicate with other people effectively. The second precious lesson is how to create a positive organizational culture.
For example, if all the employees of Amazon of always trying to find the mistakes that their peers are doing to report them to their superior and were working together instead, they could put all this unnecessary energy in a focus group to find innovative ideas and to help each others. This type of positive climate could help people staying in the company and not leaving after few months, because the stress encounter at work is too high. The article cited that Amazon had the second-highest turnover among the Fortune 500 companies, with a median tenure of one year, which is really low. [2] The espoused values of the Amazon’s culture are “work hard, have fun and create history”, but the enacted values just seemed to be hard work and success. The Amazon culture can be described as an outcome orientation organization with managers asking for results without excuses.