Tony Hsieh

What does your brand stand for, and how does it deliver on that promise every day?

What we stand for has evolved over the years. In our first decade, we thought of our brand as being comprised of three Cs: clothing, customer service, and company culture. Over the years we added a fourth C: Community. We think that these reflect the lifecycle of the customer—for people who don’t know about Zappos, they learn about what we deliver first, then we show them we deliver the best customer service, and once they know about that, they get to know about our culture and core values.

That’s why we offer tours to public several times a day, every weekday. We also moved our headquarters to downtown Las Vegas, and unlike many other corporate campuses that are insular, we encourage members of the community to come on campus for events and our own employees to get out into the community.


What role does simplicity play in delivering on that promise?

One of my favorite quotes is “great brands are a story that never stops unfolding.”

I would say what we’re most well known for our service and customer experience. And that’s a relatively simple message to get across initially. Our culture and community are things that people learn more about over time, as they get deeper into the experience.


How does Zappos strive to create simple experiences?

We really leave it up to customer loyalty representatives to do whatever they can do to wow the customer. So you can say that that’s a super simplistic approach. But it comes down to hiring people that live our ten core values—making sure their personal values match our corporate ones. If we get the culture right, the brand building happens as a byproduct.


Is simplicity something you think about explicitly?

It needs to be a general principle. We definitely find out that when things are not expressed simply—the media typically gets it wrong.


What are the top challenges in creating simple experiences for customers?

As an example, trying to do something like a product exchange is not simple. And we address it in a counterintuitive way. We actually want customers to call us so we can deliver a great customer service experience, and in that process, hide the complexity from the customer. We want our customer service reps doing the heavy lifting.

We took this approach because customers just wanted to call us. Unlike websites that want to hide their 1-800 numbers, we put ours on every page and look for ways to make it more prominent. Ultimately, we’ve found that customers that have contacted us via phone have a much higher lifetime value. Ultimately, if you think about what a brand is, it’s a shortcut to a set of emotions. And emotions are a shortcut to more complex calculations.


Why do you think it is so difficult for most companies to deliver simple experiences?

I think it goes against human nature. There’s this struggle or tension between the simplicity of the story vs. being 100% precise in providing all the information. Most people aren’t comfortable with not being 100% precise. I think its critical to recognize what humans will and won’t remember. You can have a 20-page document full of 100% accurate legalese, but no one will remember it, compared to five words which capture the essence of the document.


How do you strive to conquer complexity within Zappos?

As an example, over time the Four Cs of our brand evolved and we wanted to capture all the ways we thought about employees, customers, and vendors. We began to have “inclusiveness creep.” Our purpose statement a year and a half ago became a mouthful, and though it was complete and precise, we decided to simplify it by going back to what we had before: To live and deliver WOW. It’s much simpler to recall.


And this simplifying has resonated in a greater lifetime value of the customer?

Yep. That’s part of it. But the other part is the human connection, and the relative difference between us other companies in the category. Honestly, the shopping experience on our site vs. another vendor is probably not that different, vs. the call center experience between us and that other company. Our representatives being empowered to do whatever is right for the customer is important.


More generally, what organizational changes need to be made to build a culture of simplicity within a company?

One philosophy we’ve always had is to try not to make policies that address the 1% at the inconvenience of the 99%. It’s important to trust employees, because it comes down to culture. It’s hard for an unhappy employee to deliver great customer experiences. But cultural change is a long term process.


How do you lead as a simplifier?

I try to just get out of the way. If people are passionate about something that will add value to our company, I encourage them to run with it. The long-term philosophy in driving self management is to simplify management.


What is the single most important thing a business leader can do start creating simpler experiences at his/her organization?

Ask employees for their suggestions, and listen to them.


What’s the most recent, simple customer experience you’ve had personally (e.g., product, service experience, etc.)?

There are two. In-n-Out burger due to the consistency of their product. And Post Mates, which is very simple—if I want to order food in the middle of the night, it gets there in an hour.


Getting employees to align and internalize a company’s purpose and core values, and stay committed to them, is always a challenge. What advice do you have for business leaders who struggling to drive that adoption?

We just hire people whose personal values match ours. That way, you don’t need to teach behavior. We structure employee performance review around performing to our values, and likewise we’ll terminate people for core value violation—whether or not its related to their job.

This is part of the Holacracy approach, which is a hierarchy of purposes. Each employee has a purpose statement, which plays into a concentric purpose for a department, etc., until you get the company purpose statement: To live and deliver WOW.