We are beginning a season of acquisitions and mergers it seems as we hear today with Amazon ((NASDAQ:AMZN) purchasing Zappos for a reported $807 Million. I congratulate Tony and his company of the purchase and it could not happen to a nicer group. With that said, I am a little cautious about the future of Zappos. I am of the opinion that you cannot buy goodwill. Your trust or reputation must be earned. Zappos has done that. They have placed customers first above all else. What has that provided them? The ability to be purchased for a large sum.
I can see why Amazon would want to put this jewel in their own crown. They are a decent company on the trust scale in my opinion, but they don’t have the customer in mind when making decisions. They are a publicly traded company that has one thing in mind, making profit. That is not always the first thing in the minds of the folks at Zappos. They were able to be a profitable company because they were a decent seller of goods. Amazon consumes them and perhaps snuffs out the reason Zappos was a retail darling of the Internet. Now I may be wrong on this account but if Amazon takes the approach of Zappos in how it does business and its customer focus, watch out.
You can read the release and judge for yourself. Can you buy the goodwill and trust? I like the quote:
“Zappos is a customer focused company,” said Jeff Bezos, Founder and CEO of Amazon.com. “We see great opportunities for both companies to learn from each other and create even better experiences for our customers.”
From that I hope they adopt the Zappos culture and way of dealing with customers.
UPDATE: I wanted to add this video that has surfaced since my post. I think it tells me a lot about how Amazon may approach this brave new merger.