Zappos was founded in 1999, during the Internet boom, in order to sell shoes online. The founding premise of the company was to offer their customers the ultimate choice-all brands, styles, sizes and colors. Zappos organizes all aspects of operations (including recruitment, culture, call center, inventory, website and Supply Chain) to provide the best service, it wanted to “wow” everyone who interacts with the business, from customer to Employees Corporate Partners. Zappos grew rapidly … Read more »

Zappos was founded in 1999, during the Internet boom, in order to sell shoes online. The founding premise of the company was to offer their customers the ultimate choice-all brands, styles, sizes and colors. Zappos organizes all aspects of operations (including recruitment, culture, call center, inventory, website and Supply Chain) to provide the best service, it wanted to “wow” everyone who interacts with the business, from customer to Employees Corporate Partners. Zappos grew rapidly, and by 2008 was profitable, with sales (after returns) of about $ 650 million. The company faced a series of questions as it looked forward. Although it had penetrated only about 3 percent of the U.S. market for shoes, Zappos had expanded its product lines to items such as camping gear and video games. It needed to determine those elements of the strategy had contributed to his success in the shoes, and whether it will be able to duplicate this success in other product lines. It also needed to determine how it might be business-a large part of the effort it had taken to “wow” scale its customers was labor intensive and expensive, this could be scaled to a company with a turnover of ten billion? Finally, the economic landscape has changed dramatically in late 2008, with the collapse of financial markets and recession. The service-intensive business Zappos.com was based on revenue at little to no discount, unlike many sites that rely on the sale at the lowest possible price. The company would need to make changes to respond to the changing economic environment, and if so, what were these changes? The case provides an opportunity to assess the core competencies of an online retailer that has experienced a rapid, initial success. The case allows students to supply chain issues that are critical to the success of the company, to be considered in the broader context of the company. The bases of Zappos’ success, its core competencies, culture and competitive environment
«Hide

from
Michael Marks,
Hau Lee,
David W. Hoyt
Source: Stanford Graduate School of Business
28 pages.
Release Date: 13 February 2009. Prod #: GS65-PDF-ENG
Zappos.com: Developing a Supply Chain to Deliver WOW! HBR case solution