Everything Retailer Amazon Buys Shoe Retailer Zappos
Amazon has purchased Zappos for $807 million. Reaction around Consumerist's (virtual) newsroom: "Oh, no." Then we started locking up our shoes in case our right to own them is revoked. No, no, we kid. Maybe.
CNN Money's lead explains that Zappos is "known for its selection of shoes," which is almost comically incorrect. Yes, Zappos carries a lot of shoes, but that's not why customers love them so much. This can only work if Amazon allows Zappos to keep up its fantastic, stellar, wonderful level of customer service. An e-mail to employees from CEO Tony Hsieh claims that they will do just that:
Over the next few days, you will probably read headlines that say "Amazon acquires Zappos" or "Zappos sells to Amazon". While those headlines are technically correct, they don't really properly convey the spirit of the transaction. (I personally would prefer the headline "Zappos and Amazon sitting in a tree…")
We plan to continue to run Zappos the way we have always run Zappos - continuing to do what we believe is best for our brand, our culture, and our business. From a practical point of view, it will be as if we are switching out our current shareholders and board of directors for a new one, even though the technical legal structure may be different.
We think that now is the right time to join forces with Amazon because there is a huge opportunity to leverage each other's strengths and move even faster towards our long term vision. For Zappos, our vision remains the same: delivering happiness to customers, employees, and vendors. We just want to get there faster.
What do you think, fair Consumerists?
Amazon scoops up Zappos.com [CNN]
"Zappos And Amazon Sitting In A Tree…" [WSJ]
(Photo: theritters)
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Comments:
Has there ever been a case where one company acquires another, and the little guy gets BETTER?
I need to use Zappos, I need new shoes. I've heard nothing but great from here. Plus I did that free memberthing thing for life for free shipping.
I have no qualms with amazon. Never had a problem with them. Plus they have some call center in my hometown, I think. And I've met the CEO when they put in the call center. My friend asked him (a billionire) for a dollar when he announced that they were putting in a call center. He laughed and that was it.
They had a $200 million off $1 billion or more coupon.
damn, what will happen to zappos legendary customer service?
uh huh... good luck with that one. id just go ahead and remove their entire customer service record right now, and "merge" it with amazons. let them re-earn it
@catastrophegirl - sometimes makes typos and doesn't care: It'll get buried in layers of corporate bureaucracy and replaced with the bottom line, penny pinching priorities of a publicly traded corporation?
*Sigh*
That's all there really is to say.
I generally have good customer service from Amazon, but it doesn't measure up to Zappos. I will remain guardedly hopeful, because Hsieh has typically been very upfront with his employees and the public. But ... misgivings!
@Kimaroo - 20% More Kitty Added!: Now I see that you were responding to yourself and I feel stupid. LOL.
Seems like a perfect match to me - Amazon customer service ROCKS, and so does Zappos. It isn't like some shitty retailer absorbed Zappos - these are two of the best online retailers. I think Amazon just got annoyed that their own shoe/handbag venture didn't do too well, and went shopping for something better.
Now, if only the other rumor about Amazon could come true (Amazon buying Netflix), then I'll be really happy.
Will our free shipping for life accounts disappear? That would be sad.
@scoobydoo: Have you seen Amazon's ship dates? If you order something, it says the estimated date is about 2 months after the order is placed.
@scoobydoo: I think it's just that Zappos was sort of a niche store that did pretty much one thing, and did it well. Plus, I guess they were small enough that they could get away with free shipping (both ways), and offer more dedicated customer service.
Not saying it's inherently a bad thing, but I'm just not sure that a smaller company can keep up the commitment level after being absorbed by a larger one.
As someone who uses both Zappos and Amazon, this leaves me worried; acquisitions very seldom improve the firm being acquired. On the other hand, Zappos apparently achieved $1 billion in web sales last year -- a figure that staggers me -- so it looks as though Amazon could get a good ROI on buying them for just $800 million. We'll see. ..bruce..
@AreYouConfusedYet?HowAboutNow?: That's only for items that aren't in stock (every estimate I've seen in that scenario was automatically "1-2 months"). If you pay for shipping, it's 2-5 days, and the free $25+ shipping is usually a week or so. Slower than some (like Zappos), perhaps, but not outrageous.
"Huckabees, The Everything Store"
I shop OFTEN online and have never bought from Zappos because their prices are so high. Why would I shop there when I can get 20-30% off coupons at least twice a month at Shoes.com or Shoebuy.com?? Since Amazon rarley coupons, I see this is not going to change.
@AreYouConfusedYet?HowAboutNow?: what in the world are you ordering? I buy everything from amazon.com and get it speedy fast. Always. I buy electronics, shave cream, toys, bras, you name it. Have for years. only if it's out of stock or being shipped from a DIFFERENT vendor could there be the potential for delays. I always make sure it's coming from Amazon.
@AreYouConfusedYet?HowAboutNow?:
What are you buying?
The previous 100 or so orders I placed were all here in 2 days (thanks Prime!). I've even regularly ordered on a Friday afternoon at 5pm with Saturday delivery and had my order here by 10am. 2 years ago I placed a last minute order and had it delivered SAME DAY (for $6.99).
The trick on Amazon is to stay away from third party sellers.
This news is sole-searing.
nooooooo!!!!!
WHY???
i am recovering from food poisoning, and this just makes me feel sick all over again. its like FLickr part 2, nothing good can come from this.
Wouldn't it be something if Zappos customer service rubbed off onto Amazon? I mean in the figurative way, not the dirty way, you pervs.
Amazon won't change the business model of Zappos? Hahahahahaha! Oh, that's a good one.
NOT TRUE!!! i OFTEN find myself going to another online and ofline retailer because amazon shipping and arrival dates are at least 4 weeks into the future. i ordered something from Zappos on monday morning, and by Tuesday the doorman told me i had a package waiting. EVEN when i HAD amazon prime and paid for overnight shipping that NEVER Happened.
@RedwoodFlyer: I'll buy whoever can come up with a good pun w/ the word "metatarsals" a new pair of shoes.
@supercereal: Amazon owns endless.com, a VERY similar site (minus the awesome service that Zappos is powered by), which also offers free 2 way shipping. Most shoe makers have minimum advertised pricing rules = huge markup. Since the online guys don't have to pay $$$ for mall stores and sales commissions, they can more than afford free roundtrip shipping - especially given the amazing contracts Amazon has with UPS.
BTW, I recommend this awesome article about Zappos robo-crew
This is interesting because Amazon already has endless.com. their online shoe store. The prices at endless tend to be cheaper than zappos and they offer free overnight shipping. I am curious to see how this plays out.
I have a habit of purchasing sensible, sturdy shoes that make me look like a lesbian.
Will Børn and HS Trask shoes have their ratings removed after the takeover?
Nooo! My thoughts on this are in line with the first comment. A part of an exemplary company has just died.
@RedwoodFlyer: I remember reading an article about the robo-crew in Wired Magazine awhile back. Definitely some interesting and fun stuff.
And I've never heard of endless.com until now, but looking over the site, I definitely like what I see. If they're indeed owned by Amazon, then that seems to bode well for Zappos.
@KittensRCute!: I can't help but have my doubts about that. If you're ordering from a third party vendor on Amazon, I can definitely see your point. But for orders fulfilled via amazon.com proper, I still say you're highly unlikely to have to ever wait a month+ for shipping (nevermind "often").
@jakesprincess: Came here to mention and/or ask the same thing, as I have frequented both establishments (Zappos and Endless) and have been happy with both!
My first thought: "noooooooooooooo!"
I totally get it that the shoes are slightly overpriced to pay for the "free" shipping -- ya never fooled me there, Zappos. The reason I love them is that I have ridiculously strange feet, short, high arches and double-EE. Even in NYC, I find it very hard to find shoes that fit well and don't look like orthopedics.
Zappos makes it extremely easy for me to narrow my searches, and order (and return) loads of shoes so I can get something that doesn't turn my toes purple. In return, I've been a loyal customer since the beginning and spend all of my shoe dollars with them.
I hope Amazon doesn't get an itch to meddle.
@meechybee: I too buy from Zappos b/c of my special needs feet (size 11 wide, must have fabulous arch support, etc.) and being able to find shoes that suit my needs is worth the higher price. I'll be ticked if they take away VIP free overnight shipping... but I bet that's the first thing to go.
Zappos needs to change Amazon from the inside. :)
For a perfect reference concerning mergers, I refer you to the "Bastard Operator From Hell".
@jakesprincess: Endless tends to have less expensive shoes, but the styles and brands don't always cross (for instance, both stores carry Nine West, but not often the same styles).
Endless didn't used to do free shipping. It used to charge around $7 for shipping, and it was a gamble because if you had to return them, you had to pay for it and you weren't going to get your shipping money back.
@KittensRCute!: Shipping and arrival dates aren't a precise science. All of mine say 2 weeks, but arrive in one week. It's just part of the way they track packages.
All the Skechers branded shoes from Zappos have turned out to be crap in my experience. Purchased a couple Kenneth Cole shoes and those were wonderful. My last one was a Steve Madden and they're falling apart in just over a year of use.
Does Zappos have a return policy for a 1 year (and a few months) old pair of shoes? If not, I don't think Amazon acquiring Z is going to make any difference.
Given Amazon's customer service I hope they don't bring Zappos' customer service to the same levels.
Well, looks like we can kiss Zappos' great customer service goodbye.