Role of Customer Loyalty and Retention, Essay Example

Chosen Company – Zappos

Zappos is an online retailer that started out selling shoes, but now sells an array of clothing, eyewear, watches, accessories, luggage, handbags, baby items, and beauty items. Zappos is a company that values giving good service to its customers and its employees. Its core values include delivering the WOW factor through excellent service, being open-minded and adventurous, pursing growth and learning, and building open relationships through open communication (Zappos, 2004).

How Zappos Retains Loyal Customers

Acquiring and retaining customer loyalty and retention has played a significant role in marketing for Zappos, as its management strives to implement strategies to keep customers coming back and to have them refer new customers. This is important to the success of a company in today’s competitive market.

The global competitive market includes Internet-savvy customers who are empowered to comparison shop on a daily basis. This means they understand they have options, which means that if a company wants to remain competitive, then it had better find ways to instill loyalty for its brand with its current and future customers. This is best done with customer relationship management (CRM). CRM is the way to generate loyal customers, which includes implementing effective value propositions into a company’s strategic marketing plans (Roberts-Lombard, 2011).

Zappos CRM Strategies

Zappos is clearly a company that goes way above and beyond what is expected  (Zappos, 2004) to please its customers, as it employs 500 call center employees who work from its Las Vegas corporate facilities, according to Edwards (2012). This is important because many other companies outsource their customer service department oversees, which often results in sub-par customer service. Moreover, Zappos customer service representatives have been thoroughly trained and are empowered to do whatever it takes to make customers happy. For example, a woman who had to order six pairs of shoes because of her feet injury received flowers from a Zappos customer service representative. Another extraordinary gesture from a Zappos customer service representative was physically going to a rival shoe store to get a pair of shoes for a woman, because Zappos did not have the shoes currently in stock. Another customer service benefit from Zappos includes free returns with no questions asked (Edwards, 2012). One thing the company does not apparently have is a defection management program.

However, Zappos cultivates out-of-the-box CRM strategies to maintain customer retention and to amass a load of customer referrals from its already satisfied customers. Another part of Zappos’ customer retention strategy includes building and maintaining strong relationships, both inside and outside the company. Zappos’ core values include understanding that happy employees work better and will be motivated to make sure the customers are well taken care of. This pertains to Zappos’ core value #6, which states,

Strong, positive relationships that are open and honest are a big part of what differentiates Zappos from most other companies. Strong relationships allow us to accomplish much more than we would be able to otherwise. (Zappos – 2, 2004)

Zappos is a company that understands its success and bottom line are directly related to acquiring and maintaining a solid customer base, and giving excellent service means happy customers that keep coming back. Great customer service equals bigger profits and longer sustainability of the business.

References

Edwards, J. (2012, January 9). Check Out The Insane Lengths Zappos Customer Service Reps Will Go To. Retrieved from Business Insider: http://www.businessinsider.com/zappos-customer-service-crm-2012-1

Roberts-Lombard, M. (2011, May 4). Customer retention through customer relationship management: The exploration of two-way communication and conflict handling . Journal of Business Management, 5(9), 3487-3496.

Zappos – 2. (2004). Zappos Family Core Value #6. Retrieved from Zappos.com: http://about.zappos.com/our-unique-culture/zappos-core-values/build-open-and-honest-relationships-communication

Zappos. (2004). Zappos Family Core Values. Retrieved from Zappos.com: http://about.zappos.com/our-unique-culture/zappos-core-values