Experience Syndication: Powered by Zappos

I have been thinking a lot about the new Powered by Zappos service.

According to Zappos:

Powered by Zappos (PBZ) is a feature Zappos.com offers to its partners where we design, host, fulfill and own a partners web site. Our goal is to provide Zappos customers as well as our partner’s customers with the best possible service experience. By building partnerships through PBZ we can deliver great service to more people. Ultimately if you are purchasing through a PBZ site you are making a purchase from Zappos, your package with free shipping will even arrive in a Zappos.com box and you will receive all the great benefits Zappos has to offer.

For lack of a better term, I am calling this “experience syndication” since PBZ is essentially syndicating the value of the entire experience – not just one aspect such as content or business process or infrastructure. A quick Google search reveals that would-be competitors such as Clarks Shoes, Stuart Weitzman, Bostonian Shoes etc. are already utilizing PBZ.

I am of two minds on PBZ. As a business strategy I think it is a brilliant play. Zappos is syndicating the very thing that makes them great – the entire experience; from browsing to buying and especially post-sales support. In the hyper-competitive world of ecommerce, individual, mid-market brands like Clarks simply can’t compete with that so they better join. It also raises an interesting question. What other companies might look at syndicating their experience?

On the negative side: I am a big fan of Zappos but I am not blind to the fact that the more successful the PBZ offering gets, the more power they will wield over individual companies that depend on them for survival. In that sense I fear that Zappos may ultimately do to shoe companies what Amazon appears headed to do to book publishers – and what Walmart has already done to countless small brands – put them in a death grip and squeeze the life out of them. Let’s hope I am wrong.

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  • R.B.Ross

    This makes all kinds of sense to me. Is there anything PBZ can do/say to counter this concern?

  • Dave Robertson

    Is a tool like Magento a natural counter strategy? In a head to head battle, what are new businesses going to pick? Experience Syndication or Open Source E-Commerce?

  • Dave Robertson

    Is a tool like Magento a natural counter strategy? In a head to head battle, what are new businesses going to pick? Experience Syndication or Open Source E-Commerce?

  • Amanda Mahan

    What’s interesting to me is, why don’t other companies copy what’s good about the Zappos experience and then improve on it?

  • http://radar.oreilly.com Joshua-Michéle

    Dave – Open Source eCommerce software like Magento will likely only get bigger since the real play in ecommerce is all about integration to back-office systems – which is big $$$ for services. However in the near term I think there is still room for ppl like Demandware and Marketlive who have their own platforms. These platforms really sell off of the usability of their admninistrative features. OS software that I have seen usually really lags in terms of ease of use and administrability – and this is a big drawback when the promise of these platforms is to let non-technical users have free reign over site changes and merchandising.

    Amanda – Your question gets to a core point about what makes Zappos, Zappos. It is not their policies and procedures. It is their culture of customer service. In a big company that is one of the most difficult things to change. I imagine in this case such a change might start with bringing your call centers back in-house, simplifying your IVR system so that humans actually reach humans when calling customer service, and retraining and then upping the pay-rate of every CS rep… That is just a start and you can see why the economics alone would give most companies pause.