High-touch vs. High-tech

Nothing highlights divergent customer service styles at Amazon and Zappos more than the case of the disappearing novels.

The incident involved Amazon remotely removing books, including George Orwell’s 1984, from customers’ Kindle electronic readers. Customers complained they got an e-mail about a refund to their account but no explanation. The books had been entered into Amazon’s catalog in violation of U.S. copyright law, and observers agreed the company was within its rights to erase the novels from customers’ devices. But in contrast to Zappos’ tradition of bending over backward for customers with high-touch service, Amazon came off as a kind of high-tech Big Brother.

“How ironic that the book they deleted is 1984,” says Jennifer Benz, a San Francisco-based communications consultant.

In the wake of the dust-up, Amazon pledged that in the future it will not remove books from customers’ devices in such circumstances. Amazon chief executive Jeff Bezos also apologized in a user forum and called Amazon’s response to the problem “stupid, thoughtless, and painfully out of line with our principles.”

Amazon is no service slouch. It ranked first on BusinessWeek’s list this year of the “Customer Service Champs.” Zappos also did well, ranking seventh. But the firms differ in their approaches to service. On its Web site, Amazon defines what customers want as “low prices, vast selection, and convenience.” It relies largely on customer self-service over the Internet: The main home page does not list a phone number; nor does the “Help” main page, though users can click a button to contact the company by phone.

Zappos, by contrast, puts a 24/7 customer service number at the top of its home page. And it emphasizes the human touch—including extended phone calls with customer service representatives and handwritten notes from them.

In the BusinessWeek ranking, Zappos outperformed Amazon in a coveted category: percentage of customers who would “definitely recommend” the brand. Zappos scored a 69 percent, second only to insurance company USAA. Amazon ranked fourth with 64 percent.

Amazon has pledged to let Zappos run itself independently once acquired. Still, a firm’s customer service reputation can affect employee morale throughout an organization. So it’s conceivable the Kindle-Orwell incident may have dampened Zappos employees’ enthusiasm for the merger.

Aaron Magness, Zappos’ director of brand marketing and business development, says he is “very satisfied” with how Bezos handled the situation.

“He personally addressed the issue and addressed those affected by the decision,” Magness says.