DS: I would say that one area that we still have not gotten into, and I feel like there’s some potential, is mobile. The reason why we haven’t focused on that is twofold: There are so many other areas that are taking up our priority queue right now that we haven’t gotten to it yet; the other is that we’re somewhat leery of the perceived value by our customers. And if those customers see that as a threat … we just don’t want to be too intrusive and get into a channel that will alienate our customers …
TM: How has Zappos’ direct marketing strategy changed during the recession?
DS: I would say, among other things, one thing that we have done is we have shifted our focus away from channel-level optimization to campaign-level.
We’ve always focused and optimized all campaigns down to the lowest level of granularity; that’s never been a change. Though, we’ve allowed them to all roll up in terms of ROI or profitability at the channel level. So if that channel is performing at a good level, then we allow certain campaigns to perform at high volume, low profitability, low yield. And now we’re shifting away from that and trading out those partners that are high volume, low ROI, or optimizing further to get those partners to a level where the volume may be a little lower but our ROI is sustainable at that target, so every campaign will fit that ROI. …
We are shifting our strategy somewhat to favor a bottom line and really just tightening the ship, so to speak. … In 2008, we spent a lot of time throwing things at the wall to see what would stick. Now that we’ve got an idea of what is sticking, we’re going to optimize those things and make them more profitable. So this is our year to tighten the ship and make the most out of our learnings in 2008.
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