How Zappos Measures & Improves Customer Service Performance

Despite its widespread recognition as the model for customer service excellence, very few companies heed Zappos' service-centric example. Nowhere is this more apparent than in the continued popularity of antiquated performance metrics.

Take a look at your own KPIs. Is time-to-resolution an important indicator? What about call time? While popular, these measures are indicative of a very un-Zappos experience. They don’t "drive service into your culture," Joseph Michelli, author of The Zappos Experience, told me in a recent interview.

"Zappos invests in the call center not as cost, but the opportunity to market," he said.

So what should be measured? Here is a list of metrics and strategies Zappos uses to improve performance, productivity and customer satisfaction.

Measure Call Time Percentages, Not Quantities

Zappos Loyalty Manager Derek Carder told me one of the most important factors for each call is creating an emotional connection with the customer, "rather than rushing them off the phone," he said. Leadership does, however, want to make sure agents are spending as much time as possible on the phone. It just doesn't matter if it's one call or 100 calls. CSRs are just expected to spend at least 80 percent of their time in customer-facing interactions.

This metric–personal service level–is a way to empower the team to utilize their time how they see best promotes customer loyalty. Top performers are rewarded with paid hours off and other incentives.

Applying Metrics to 'Wow' Moments

Zappos utilizes a 100-point scale called the "Happiness Experience Form." This measure evaluates each call against the following factors:

• Did the agent try twice to make a personal emotional connection (PEC)?
• Did they keep the rapport going after the customer responded to their attempt?
• Did they address unstated needs?
• Did they provide a "wow experience?"

Track Idle Chats

Similar to talk time, Zappos doesn’t value time to resolution or quantity of interactions when it comes to chat. The agent is expected to create a PEC and follow the same guidelines as a phone conversation. Zappos also monitors "abandonment time," or periods when an agent has a session open even though the customer already disconnected from the chat.

When agents have an idle chat window they can’t respond to a new exchange. Carder said this could be a symptom of "chat avoidance," which is comparable to an agent not picking up a call so it rolls over to another responder.

Incentivize Strong Attendance and Punctuality

Zappos combats absenteeism with a program they call Panda. Employees receive a point for every day they miss work or come in late. Staff with zero points in a given period receive a varying number of paid hours off. These hours can be accrued and stacked for an entire paid day off.

Emphasis on call time and time to resolution yields rushed, impersonal interactions. Instead, Zappos has found a way to measure and reward behaviors that impact customer satisfaction most.

Ashley Furness is currently a CRM market analyst for SoftwareAdvice, where she blogs regularly on customer service.