Zappos Sells More By Encouraging Returns

from the outrunning-the-competition dept

Although it may not get that much hype, Zappos has built up an impressive and successful online shoe retailer. While shipping costs are often the bane of online retailers, Zappos has thrived, not only by offering free shipping, but by offering free return shipping as welll (via Knowledge Problem). Obviously, shipping is expensive, but by subsidizing product returns, the company has removed the risk of buying shoes online. Customers don't have to worry about a pair of shoes not fitting right, because they can always send them back at no cost. In fact, the company approves of customers that buy multiple pairs, just to see which pair fits, while sending the others back. Of course this cuts into its margins to some extent, but the alternative is for customers to buy shoes at traditional stores. The basic lesson is one that plenty of retailers recognize: making it easier to return items will make customers more comfortable with purchasing them. But it's the application of this lesson online, to such an extreme degree, that has separated Zappos from the pack.

Filed Under: ecommerce
Companies: zappos


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  1. identicon
    Anonymous Coward, 17 Jul 2007 @ 6:04am

    customer service wins out

    Shipping and return costs are ultimately what drives my selection between online retailers. I use BN.com over Amazon in ordering books because BN is "fast and free shipping" policy where I receive my items in 2-3 days versus 2-3 weeks with Amazon's shipping option. Zappos wins out b/c it does not cost me anything to return the items and initial shipping is super fast.

    Customer service does ultimately win out over price when it comes to my online shopping.

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