Skip to main content

Outlier’s Path

Excellence in Customer Service

Founder Mathilde Collin of Front invited me to speak at Customer Service Game Changers this past week. Much of the conversation centered around what I learned from Zappos. Since I left Zappos to join Sequoia over thirteen years ago, I wrote notes to refresh my memory before the webinar. Ironically, these notes were valuable in several board meetings this week, even for a public company.

Here are some of my notes:

  • Culture of Customer Obsession. Start by developing a culture that obsesses over the customer and their entire experience from beginning to end. Many companies believe they are customer-obsessed but only focus on their product or service. They spend little time thinking about the whole experience, especially exception handling when things go awry. Customer obsession is about the entire experience. It is also likely your most passionate raving fans are those customers who had a bad experience, but you turned them around. Airbnb storyboarded the whole guests’ and hosts’ experiences. DoorDash did the same for their merchants, customers, and dashers. Zappos’ answer to customer obsession was to tie our strategy to our first cultural value: Deliver WOW through Service.
  • Your Brand of Customer Service. If we contact most companies’ contact centers and if they don’t mention their companies’ names, we are unlikely to be able to tell them apart. Most companies think a call, chat, or email is a nuisance, and service costs need to be minimized. At Zappos, every call, chat, or email was an opportunity to deliver a branded experience, and we wanted that experience to develop a sense of loyalty to Zappos. For this reason, we rebranded our customer service department to our Customer Loyalty Team. Thus, we measured the team’s success by customer retention. Over eighty percent of our sales were from repeat customers on any given day. So, what is your brand of customer service?
  • Different AND Better Experience. Customer service technologies allow sophisticated routing so an agent can specialize, focus on a small task, and ensure repeatability. Zappos noticed that routing technologies were far from perfect. Too many customers were rerouted, causing already unhappy customers to become irate. Instead, we had minimal routing and trained and empowered every employee to answer every customer service request empathetically even if they were routed incorrectly. This differentiated generalist approach led to a very high first-contact resolution rate and a much better experience.
  • Focus on Critical Input Metrics. Customer service metrics and dashboards are a data scientist’s dream. If your team can’t see the forest from the trees, focus on the most critical input metrics rather than the output metrics, such as CSAT or NPS. Your team can affect the inputs and thereby influence the outputs. Measure what is consistent with your differentiated branded experience, not what others blindly measure. Zappos doesn’t measure average handle time because it is at odds with long calls that deliver empathy and develop customer loyalty. Instead, Zappos measures response time, first-contact resolution, and customer retention, which correlate with CSAT and NPS.
  • Contextualize Customer Experience. Customer service teams have so much rich context about the customer experience. Yet, that is often lost because most customer service teams are run just by the numbers. It is no secret that every Zappos team member is trained and then spends 1-2 weeks in the contact center yearly to ensure we continue to have an understanding of and empathy for the customer. Less known is our daily context report. Every Customer Loyalty Team member starts their day with a rapid-fire huddle discussing the Good-Better-How of yesterday. Each team member would discuss what went well, what could have been better, and how they would improve from yesterday. Each team lead of approximately ten team members would summarize the huddle and send it to their supervisor. The supervisors would summarize the reports from their leads, attach the reports from their leads, and email them to their managers. The managers repeat the same process and send it to the VP. The VP would do the same and send the full report to the company. This report was not sophisticated, but it centered our Customer Loyalty Team members on continuous improvement, shared learning across teams, and gave the entire company a pulse of the customer. This report brought context to our metrics and led to numerous product, service, and customer experience improvements from the direct feedback of our customers.

While I learned so much about developing a differentiated and branded customer loyalty experience at Zappos, these were lessons from over a decade ago. Mathilde closed by asking me who I thought she should have as her next guest. I am curious how Bret Taylor and Sierra will vastly redefine today’s customer experience with artificial intelligence.