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Case Study Of Zappos

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Why AMAZON acquired ZAPPOS?
AMAZON acquired ZAPPOS for a whopping $850 million. ZAPPOS.com is an online shoes and clothing store based in Las Vegas. They were exclusively dealing in shoes and now they have expanded to eyewear, watches, clothing, handbags etc. But 80 % of their revenue comes from shoes. They had annual revenue of $630 million before Amazon acquired the company.
It was a surprise for everyone because Amazon is a behemoth with revenue of over $45 billion. So why should they acquire another smaller online store?
The answer that Jeff Bezos gave was that Amazon was interested in Zappos because of the unique culture of the company. The other reasons may be:
Zappos is a fast growing company. Their customer service is legendary and …show more content…

They give at most importance to the fact that the employee should be a cultural fit. The employees are expected to live their values. The hiring process is sometimes called “courtship”. A long time takes between initial interview which is used to check the cultural fit and the final job offer. The interviewees are asked behavioural questions. If the candidate passes the test, he/she is invited to meet with multiple employees and to cultural events of the company so that the candidate gets a chance to see the prospective employee family.
Zappos pays the employees to leave the company. They pay $3000 dollars as a one-time payment. This system is based on the fact that if the employees are not happy working in the company or is not interested in the work, it is better that the employee leaves the company.
Managers promote Zappos culture, almost 10 -20 % of their time is spending on team building activities. Activities are of various kinds, sometimes Easter Egg Hunt, cook outs, family events. Instead of performance evaluations, cultural assessments are done. They are also given feedback on their cultural fitness and tips for improvement. Pay raises are based on passing of skills

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