Guest Post: Create a Zappos-Like Culture of Customer Service With Performance Metrics

We’ve written about Zappos’ great social media efforts, but the online shoe retailer has other impressive qualities, too. In this week’s guest post, Software Advice’s Ashley Furness tells you how to create a Zappos-like culture of customer service using performance metrics.

It seems traditional marketing increasingly turns away customers in today’s Yelp and social media-obsessed world. Advertising, PR, and other promotional spending fall on deaf ears while bad messages travel further, faster.

This has prompted a sea-change in the way some companies approach their marketing budget. Could a Zappos-level of customer service provide a better return on investment?

“Zappos invests in the call center not as cost, but the opportunity to market,” Zappos Loyalty Manager Joseph Michelli explained to me recently. He authored a whole book on the concept, called The Zappos Experience. This has resulted in as much as 75 percent of their sales coming from return customers, who spend on average 2.5 times more than first-timers.

So how do you create this Zappos-like culture? It starts with the basics – performance metrics.

It’s About the Wow Moments
Making the customer feel appreciated is a priority for Zappos. They do this by grading calls on a 100-point scale they call the “Happiness Experience Form.” Every agent is expected to maintain a 50-point average or higher. This score is based on several factors, including:

  • Whether or not the agent tried to create a personal emotional connection with the caller
  • Whether or not the agent continued the conversation if the customer responded positively
  • Whether or not the agent identified and responded to the customer’s unstated needs
  • And whether or not the agent gave a “wow” experience or went above and beyond

“Customer service creates an environment of one-to-one communication. That intimacy creates a special opportunity to build a relationship as opposed to a top-of-mind impression through advertising,” Michelli said.

At the end of the month, management identifies agents with less than a 50-point average on the Happiness Experience Form. Those agents receive extra training. Top performers are rewarded with paid hours off and other incentives.

Watch Those Idle Chats
Zappos also monitors “abandonment time,” or periods when an agent has a chat session open even though the customer already disconnected from the chat. The reason this is so important is two-fold:

One, idle chats are a symptom of chat avoidance – or the agent purposefully creating conditions so they don’t have to respond; and two, when agents aren’t responding, customers wait longer. The longer they wait, the more apt they are to abandon the session.

This strategy zeroes in on the cause of unproductivity in the chat setting – idle chats – without deterring agents from expressing the values in the Happiness Experience Form.

Still Measuring Call Quantities?
Zappos’s longest call on record lasted more than eight hours, and guess what? This interaction was lauded by leadership as a stellar example of serving the customer.

“It’s more important that we make an emotional connection with the customer, rather than just quickly getting them off the phone,” says Derek Carder, Customer Loyalty Operations Manager for Zappos.

Instead of valuing quick time to resolution or processing high call volumes, Zappos looks at the percentage of time an agent spends on the phone. Every agent is expected to spend 80 percent of their time on the phone, in chat, or in an email response. This metric is a way to empower the team and to utilize time in a way that best promotes customer loyalty.

Attendance is Key
Absenteeism can be a huge detractor from your customer service productivity. Zappos uses a program they call Panda to combat this trend. Employees receive a point for every day they miss work or come in late. Staff with zero points in a given period receive a varying number of paid hours off. These hours can be accrued and stacked for an entire paid day off.

This decreases the days missed by employees, but also increases job satisfaction. What Zappos-level strategies does your company use to create a customer-centric culture? Let us know by commenting here.

Ashley Furness is a market analyst with Software Advice.

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