1) What was the original business model for Zappos?
2) Around 2003, what new business model did Tony Hsieh, Zappos founder, institute? What was the premise of this new business model?
3) What led to Zappos popularity? Can this be sustained?
4) Evaluate Zappos' current state of business.
The original business model of Zappos was that it was a seller of shoes online. The company would book orders for shoes online and supply them to customers who booked orders online. A part of the original business model was the drop ship method. That is Zappos did not keep the shoes in stock but instead transferred customer orders and shipment details to manufacturers and wholesalers who made the shipment directly to the customer. The difference between the wholesale price and retail price was the profit of Zappos. The main model was that Zappos was an online shoe selling company (The Editors of New Word City 2011),.
In 2003 Zappos decided to introduce a new business model. It set about developing relationships with its customers. This is also called the loyalty model. The loyal customers return to Zappos. This model was based on the premises that Zappos will give superior customer service. This was a change from the ...
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