Ten Questions with Tony Hsieh of Zappos

OK, let's dig in our heels and get Q4 off to a great start. Tony Hsieh of Zappos has some valuable insights to offer us that point to his success with Zappos as a result of a simple focus on great customer service, and not being distracted by comparisons.

Whether or not you're selling millions of pairs of shoes and partnering up with Amazon, delivering customer happiness is a goal all of us in business ought to be shooting for. Frankly, this economy demands it. Link here to read the full interview in today's TechRepublic.

Opportunity Out of the Blue

There are two points that bear noting as the Jet Blue story continues to play itself out. One is that even a great unique value proposition can become an Achilles' Heel. The second is that catastrophe often brings out true character in companies just as it does in individuals. You can buck up and figure out where you made your mistake or you can shave your head and get a new tattoo.

There's a saying that perfection is the enemy of the good -- when you have a strength in a certain area you can overfocus and it becomes a weakness. Jet Blue has worked its way up over the last seven years to become the eighth-largest domestic airline by having, among other things, the least number of cancelled flights. In that micro-macro shift we all need from time to time, avoiding cancellations is now a lesser piece of the low-fare customer-service strategy that can keep them on their 25% growth path. The announcement of a loss expected for the first quarter is offset by a minor effect predicted for total earnings this year.

David Neeleman, Jet Blue's CEO, has beat congress to the punch in their drafting of a passengers bill of rights with his Customer Bill of Rights. The bill reaffirms Jet Blue's commitment to "superior service" by spelling out a range of compensation from $25 to $1000 and free travel for delays of various lengths and overbooked flights. Neeleman's youtube video promise on the JB home page creatively spins one of the "challenges that comes along" into an advantage, not in a crazy giveaway but in a measured response of transparent sincerity. His emphasis in the three-minute diatribe is on employee flexibility and accessibility, as well as beefing-up staffing in general. In Neeleman's words, "This will be an aberration..."

Legislating Customer Service

Considering that the government is normally in last place when it comes to customer service, it's at least ironic that legislation of minimum levels of customer service a company must provide are being drafted by both the House and Senate. This "passengers bill of rights" would extend beyond health- and safety-related issues to quality of service, for example how long travelers can be kept waiting on the tarmac or to find out whether a flight has been cancelled.

Jet Blue kept its customers waiting as long as ten hours on some flights due to weather starting on Wednesday and has now cancelled almost 25% of its weekend flights trying to catch up. For those who finally got on their way to Aruba on Wednesday evening instead of Wednesday morning, Jet Blue's concession of "unacceptable" was underwhelming.

The bills being drafted in congress requiring maximum waiting time on a runway and for notices of cancellations couldn't have gotten a bigger boost in their push to better synchronize corporate perception of customer service with customers'. Jet Blue is not alone, and neither is the airline industry. Last year, a Bain and Company survey found the gap across 362 companies to be as great as 70% between customer and corporate perception of "superior experience."

The Five Levels of Customer Service

Customer service and marketing are joined at the hip -- if you do a remarkable job in the area of customer experience, good marketing gets the word out. If not, your marketing efforts have little to talk about. Here are five levels of customer service I've experienced recently:

1. "Over the top service is what we're about." (Lands' End) - I talked to Mary who answered after two rings. It was like talking to my long-lost aunt or grandmother. She was friendly, helpful, a good communicator, answered all my questions, and graciously transferred me only when it was necessary - one transfer to talk with another (friendly, helpful, gracious) lady in accounts, with very little wait time.

2. "We do value our customers." (Dell) - Gets the transaction done politely. I started online in spite of the ambiguous choices on the order-screen; called back later when the part was wrong, made three re-explanations of the fairly simple problem. After four transfers and longer waits, was finally offered the correct part. There was no expression of intent to correct the original online problem for future customers, but no charge for the wrong order and no need for me to send it back. I got two calls back to make sure I had received the credit to my account.

3. "We know customer service is important." (Citibank) - A sincere but hollow claim of concern for the customer. After many rings, the voice intones, "We've added more features for your convenience - you must now press one to continue in English." Just to see what would happen, I wait. Again the voice declares, "You must now press one to continue in English." OK, I press one. After a short pause, "For your convenience, we are open from 7:30-4:30 EST. Our offices are now closed."

4. "Hey, we got a business to run here." (Biggers Auto Dealership) - Bordering between apathetic and hostile. I e-mailed this local dealership about a part through their web site, including my VIN, and got an immediate auto-response, "We value your business, etc... we will be in touch,..." I waited a month and called - the service department is closed on Saturdays. (No one would want to get their car fixed on a Saturday, right?) I e-mailed again to a different person who told me I needed to send the VIN again. I did and mentioned I had already included it with my original request a month ago. No comment - just the price. (Did you know there are ten ways to apologize to your customer?)

5. "Next!" (DMV) Customers-Serve-Us. Of course state and local government has no real competition and responds to customers accordingly. Lines, forms, carbon copies, white out, attach this other form, 7-10 days response -- customer service is when you can buy a $40 transponder to make it easier for you to pay Rod Blagojevich to build more toll booths. Some businesses go this direction but they don't last long.

Which level of service is your company on and how are you working to get to the next one?