From event activation to issue advocacy, from product promotions to crisis management, the microblogging platform allows businesses many modes of customer communication that can be tailored to match their customers’ preferences.

Today I tried to get my mailing address changed at my drinking water utility company. Without a chance! Both their telephone helpdesk and the internet was not working ! While I spoke with a customer service officer on the phone he could not take note of my question. So I reached out to their Twitter account [http://twitter.com/WorldWaternet], only to find out that they use that account for promoting their corporate sustainability initiatives.

Truth is: not all companies who could be interacting on social media for customer experience do so yet. Amazon for example won’t use them to respond to customer queries. Our research showed that 11% of companies never reply to consumer service questions on Twitter.

Fortune took 8 companies to the test and compared their customer service efforts via Twitter, on the phone and via internet. Hyatt hotels,  Dell, Bank of America and Microsoft are amongst the tested companies.

It’s no secret that we at InSites Consulting are huge fans of Zappos, but in this Fortune test their customer support via @Zappos_Service was somewhat disappointing. The tweeted question was about changing a shipping address on a recently placed order. In a cheerful reply the question was “answered” by forwarding the number to Zappos’ customer service telephone line, asking that official customer service questions be directed through more traditional channels.

The other examples also show that in most cases the old-fashioned, often infuriating, customer service hotline was actually the fastest and most thorough means of solving a problem. The reality is that only the simplest questions can be answered in 140-character messages. And even then, you’re not guaranteed to get a response.

In the article Amy talks about the way they supported the launch of Tony his book Delivering Happiness. They used a blogger program that identified bloggers (not only business bloggers) and gave them an advanced copy of the book. 800 bloggers from around the world were involved. They were screened online (Facebook, Twitter, …) to see if they expressed the desire to spread the movement. According to Amy ‘identifying and empowering passionate customers/fans to promote your product or service can arguably be the most effective from of marketing!‘ We cannot agree more!

After the launch these brand ambassadors were involved in the planning of the Delivering Happiness Bus Tour and will be consulted in the development of an online community.

1. Happiness is about 4 things:

• Perceived control: being able to decide if you want to learn and grow yourself
• Perceived progress: feeling like you move forward
• Connectedness: focus on company culture
• Vision / meaning: being part of something bigger rather than financial performance

2. Maslow’s hierarchy

Once the basic needs of an employee are met, money is lower down the list compared to professional growth opportunities or the quality of the relationship with the manager.

3. Three types of happiness: pleasure, passion and higher purpose 

• Pleasure: always chasing the next thing 
• Passion: where peak performance meets peak engagement and time flies by
• Higher purpose: being part of something bigger

Some other ingredients for the success: 

• Stop chasing the money, start chasing the passion (when Tony decided to leave LinkExchange earlier than agreed with MS and leaving a lot of money behind!)
• Don’t outsource your core business
• Don’t focus on buzz as marketer but focus on building engagement & trust
• Deliver a WOW-experience through service 
• Don’t put traditional KPI’s on your call centre such as number of calls they can handle because that leads to getting off the phone with the client as fast as possible.
• Have Core Values you can commit on as a company
• A strong culture and committable core values are important because they create alignment among employees
• Build good relations with vendors, don’t position yourself as a client but as a partner. Work together with them!
• In terms of social media (strategy): be real and use your best judgment
• When presenting be real, be passionate and use personal stories

I especially liked the idea of the Face Game. At LinkExchange Tony realized he did not know everyone’s name anymore as the company was getting so big… At Zappos you get a picture of a colleague after you login and you have to tell his/her name. This increases the changes of serendipitous employee interactions.

Personally I love the mentality of doing a random act of kindness (or WOWness) and I find myself already doing it. And I have to share the core values, just listing them, while in the book (or on the links) they are explained in detail:

1. Deliver WOW Through Service
2. Embrace and Drive Change 
3. Create Fun and A Little Weirdness 
4. Be Adventurous, Creative, and Open-Minded 
5. Pursue Growth and Learning 
6. Build Open and Honest Relationships With Communication
7. Build a Positive Team and Family Spirit
8. Do More With Less 
9. Be Passionate and Determined 
10. Be Humble

Overall conclusion? The book is fun and easy to read and I recommend it to everyone. It is not ground breaking or new, if you follow Tony and Zappos, but it gives you a good vibe, a good feeling and is teasing you to do things different in the future. If you haven’t seen or heard about Zappos before … it is a must read!

In terms of social media and conversation management Tony tells his people: be real and use your best judgment. The way Steven is spreading his conversation management philosophy also has similarities with Tony: be passionate and use personal stories.

The book is an easy read and goes from selling lemonade and self made newspapers as a kid to selling Zappos to Amazon for 900 million dollars. In between these, Tony sold his company LinkExchange to Microsoft for 265 million dollars. Successful you could say, but the path to success was not an easy one. You might think that the selling of LinkExchange and having that much money is the only reason why Zappos could be so successful, but that’s not the case.

Let me try to summarize the story for you.

The road to Zappos maries Amazon

After selling LinkExchange to Microsoft Tony had a lot of money in the bank, together with some others he started Venture Frogs and invested in a lot of companies (more than 27 to be correct). The idea was that they would invest once and then be an advisor to the companies if they needed the advice. One of the companies was Zappos, originally named shoesite.com.

While running Venture Frogs, Tony had a lot of time and started playing poker to kill time. In the book Tony makes a comparison between running a business and poker. A very interesting comparison on evaluating market opportunities, marketing & branding, strategy … My favorites among the list are:

• Table selection is the most important decision you can make, and it is okay to switch tables if you discover it’s too hard to win at your table. 
• Remember that it’s a long-term game. You will win or lose individual hands or sessions, but it’s what happens in the long term that matters. 
• Stick to your principles 
• Hope is not a good plan
• Learn by doing. Theory is nice, but nothing replaces actual experience. 
• Don’t be afraid to ask for advice. 
• You’ve got to love the game. To become really good, you need to live it and sleep it! 
• Share what you’ve learned with others.

When investing in companies and playing poker became a bit boring, Tony started to go to raves and organize parties. Here he got inspired about how important the feeling of a tribe is. Later this would be the base for the focus on company culture. In the meanwhile, Venture Frogs became an incubator and some of the companies they funded in where moving in the building Tony was living in. The .com crisis has been very hard for start-ups and of all the companies VF invested in, only Zappos was left. Tony tried to get funding for Zappos for the future, but as they were not profitable they could get no funding. The main focus in the next two tough years was becoming profitable.

To keep the company going Tony started investing personal cash in the company. At a certain point he only had some properties but ran out of cash. In order to become profitable, Zappos has changed their business model with success. At the start of Zappos they only worked with brands who could work in a drop ship model. This means people buy on Zappos.com, the order goes to the brand and they ship to the customer. This resulted in only specific brands being offered on Zappos.com. And not the brands the customers really wanted. In order to change this they had to have a brick-and-mortar shop, start a warehouse AND find 2 million dollars to pay the inventory.

And so they did. They changed their business model. Finding 2 million dollars was the most difficult thing to do! Tony believed that Zappos had a future and decided to sell everything he had, except his loft, to get the money. The switch worked, sales went up but they still were not profitable.

The next thing they did was moving closer to the UPS distribution center to be able to ship faster. They partnered with eLogistics in Kentucky. But eLogistics oversold their capabilities and Zappos ran into operational problems. In the meanwhile they also ran out of cash … Tony, while climbing the Kilimanjaro, decided to sell his loft. And even that was not an easy sell at that time. He lost 40% on the value doing this.

Zappos had cash and was saved, for now.

eLogistics became a big problem and at that time Tony and co realized that running their own warehouse was core to their business. This switch boosted the sales again and at that time the BHAG of 1 billion dollar turnover was set for the future, together with the focus on customer experience. But still, not profitable meaning no investments. The future of Zappos depended on the go or no go of Wells Fargo to give Zappos a loan.

June 2003, that day, it happened … they had a go and Zappos was saved and became the success we all know. They moved to Las Vegas and focused on culture, customer service and employee development. Although in 2008 they had to lay off 8% of the staff, the company was later sold to Amazon for 900+ million dollars.

Later this week I’ll share some more insights on Delivering Happiness, talk to you soon!

If you want to integrate word-of-mouth in all your marketing processes, you need someone from top management to take the lead. In fact, if you think about it, Toni is the Conversation Manager of Zappos. Turning his company into a conversation company.

To make sure that your team is focused on developing and maintaining a great client dialogue, you need the right management tools. Once you use a new set of performance indicators (word-of-mouth related) to evaluate your team, they will act upon them.

It’s not just about a new set of KPI’s, but also about personal freedom. Only by giving your service people freedom to make personal decisions in order to boost client happiness, you will succeed. This implies letting go of policies that are just too strict. This implies letting go of giving approvals for all public client communication. It means: empowering people and believing in them to develop a great client relationship.

It requires structural change in the way most companies operate. That’s why I give the advice: appoint your CEO as Conversation Manager. He/She has the power to make those required changes and to create a focus on client happiness.

Zappos.com, the largest online shoe retailer in the world, succeeded in creating brand identification by creating a very focuses company culture among its employees. The management of Zappos makes it very clear to all employees that there is only one company goal: create happiness among our clients. Their policies to create this result go pretty far, here’s a great example: after you’ve been working at Zappos for a month, you can get a bonus of 2500$ to leave the company. They created this policy to make sure that people don’t stay at Zappos just to have a job. No, they want dedicated people who are proud of working at Zappos and who are willing to support the company goals.

It’s just one example of what they do to focus on ‘creating happiness among their client’s. The strategy worked, Zappos has one of the best NPS scores in the world and they were able to sell the company to Amazon.com for more than 800 million dollars in the summer of 2009.

In short: focus on internal brand identification is probably the key to external brand identification, which leads towards more positive conversations about your brand.

To learn more about their philosophy, here are some interesting stories:

Why Zappos pays new employees to quit – How I did it: Tony Hsieh, CEO Zappos.com