Zappos gets savvy with social media

As a fast-growing online retailer of shoes and other apparel, is a power player when it comes to using social media such as Facebook and Twitter to engage with existing and potential customers. Zappos CEO Tony Hsieh has nearly 1.3 million followers on Twitter, and the company’s official Facebook page has almost 21,000 fans.

Rather than using these channels to pitch products or sell its brand, Zappos focuses more on building personal relationships with customers by talking to them about the company’s culture and values. “It really is about who we are as a company rather than what we sell,” says Aaron Magness, director of new business development at Zappos.

“We let our customers see our culture and decide if we are somebody they can relate with. It breaks down the barriers of consumer vs. company and becomes more about a consumer buying from a friend,” Magness says.

Zappos is among a growing number of companies using social media to engage with customers, suppliers, business partners and employees in various ways. Most are not as far along or as sophisticated in their use of such media as Zappos appears to be. In fact, many are only beginning to dip their toes in the social media waters, and the return on these investments is still unclear.

What few dispute, however, is the tremendous reach of social media outlets such as Facebook, Twitter, MySpace, YouTube and LinkedIn and the potential those sites hold for fostering more interactive, and sometimes closer, relationships between companies, their customers and other constituents.

Magness readily admits that in Zappos’ case, much of its growing presence on social media has been organic in nature rather than the result of any strategic, long-term corporate plan. Zappos’ use of Twitter, for example, began with employees tweeting one another about places to eat or the hottest parties to go to, and the use evolved from there, he says.

Today, Zappos has a dedicated page for Twitter on its site where nearly 500 of the company’s 1,400 or so employees tweet regularly about what they’re doing at work. The site also aggregates all public Twitter mentions of Zappos -- the good, the bad and the ugly -- and presents them in a single location. The company’s Facebook page, meanwhile, features videos and pictures of company picnics, employees at work, office humor, motivational messages and much more.

There are no policies specifying which employees can or can’t post on such sites or what they can say, Magness says. Instead, posters are left to use common sense in deciding what they want to say about the company. So far, at least, that laissez-faire attitude has worked just fine.

The informality and transparency has engendered what Magness believes is stronger customer loyalty. “To customers, we are not just a faceless corporation. They know our CEO as a person as opposed to someone hawking goods,” he says. And the interactivity enabled by social media has also allowed the company to spot and respond to customer issues faster, he says.

Alumni connections

Using Facebook, Twitter and LinkedIn gives organizations a way to meet people “where they are,” says Alisa Robertson, assistant dean for alumni and corporate relations at the Wisconsin School of Business at the University of Wisconsin -- Madison. The school is using all three sites to establish a robust two-way dialogue with its 36,000 alumni.

The university’s Facebook presence is geared largely toward a younger audience and is used to promote events, relay news and in general create what Robertson describes as a “warm and nostalgic” feeling about the school among alumni.

LinkedIn, meanwhile, has enabled the business school to locate “lots of lost alumni,” Robertson says. The school has created several subgroups and affinity groups on LinkedIn to make it easier for alumni to connect with one another.

“It’s just an incredible Rolodex on LinkedIn. It’s a great way to find people,” Robertson says. Unlike the business school’s Facebook page, its LinkedIn presence is decidedly more professional and is used to promote resources like career help and job opportunities.

The business school’s use of Twitter, on the other hand, is purely about extending its PR reach. “We do whatever we can on Twitter to promote faculty research or announce some big research finding,” Robertson says. “This is really where we try to get our message out to a broader audience.”

Melissa Anderson, director of public relations at the business school, says the decision to leverage such social media tools was driven by some very simple logic. “We are outmaneuvered and outspent” by competing business schools, she says. “We don’t have a lot of budget for marketing, and we don’t have a prime metropolitan location.”

What social media has done is to level the playing field somewhat, says Anderson. “It is not very expensive. It’s been a way for us to communicate with a large number of people, and it has helped us tell our story.”

Message matched to the medium

Enterprises looking to use social media need to understand the environment in which they operate, says Paul Gillin, founder of Paul Gillin Communications, a social media consulting firm. “When you use the tools, you need to use them in the spirit of the culture that has evolved around them,” says Gillin, who is a former Computerworld editor in chief.

Often, that involves a higher degree of openness and transparency than a lot of companies might bargain for or be comfortable with, he says. It also often means resisting the temptation to view social media purely as a channel for pushing products and corporate messages, and treating it instead as an opportunity to have a more interactive dialogue with the target audience, Gillin says.

“The culture says you don’t use them as one-way communication vehicles,” whether they are blogs, social networking sites, wikis, or video- and photo-sharing sites, he says. “The unifying fact of social media is that there is a response mechanism involved.”

To be sure, the reach of social networks and the speed at which information travels over them can magnify the risk of sensitive or protected data ending up on Facebook or other social sites, Gillin says. And there is always the risk that someone in an organization could post something damaging or libelous about a company, its customers or its rivals.

“There’s kind of a party atmosphere with these tools. People are having a blast. They are using them like crazy and don’t always understand the implications of what they are doing,” Gillin says.

But these are issues that need to be handled through policies, procedures and education, Gillin says, and they shouldn’t spur companies to abandon social media efforts.

Legal, audit and compliance teams, which can sometimes stymie social media initiatives, need to be made aware that the same risks exist in traditional channels such as e-mail, says Gillin. And those responsible for maintaining a corporate presence on social media -- typically employees in marketing and customer support -- need to be sensitized to the risks as well, he says.

And while much of the early adoption of social media in enterprises has been driven by marketing, communications, human resources and customer support groups, it would be wise for companies diving into social media to bring IT, information security, legal and compliance teams into the picture as well, says Mike Gotta, an analyst at Burton Group.

He says companies in regulated industries using Twitter could be required to archive their Tweets for discovery purposes. The relative lack of identity-vetting on LinkedIn could pose risks for companies that allow LinkedIn information to sit alongside their corporate directories.

“You can’t get too far ahead of the security and identity teams because they can at least tell you where the cautionary areas are,” Gotta says.

“Education is critical,” says Kirstin Simonson, underwriting director at New York-based insurer Travelers Global Technology, a division of The Travelers Cos. In a recent Travelers Global Technology survey of 2,000 adults, about one in eight of the respondents admitted to posting work-related information on social media sites, and two-thirds said their companies have no policies for addressing such issues.

Companies need to consider the potential impact of their presence on a social media network, and who that network might reach, says Simonson. They must make sure they have extended whatever corporate privacy and data-protection policies they have to address disclosure and reputational risks on social media, she adds.

Zappos’ Magness says that in the end, it’s all about the corporate culture and how much you trust your employees to do the right thing. “If you focus on maintaining the right people with the right attitude, then there shouldn’t be much to fear” with social media, he says.

“The customer has access to all of the issues and the information,” says Magness. “They are not listening to you telling them what you think your brand is. They are telling you what your brand is.”