Build story · United States · 1999–2009
Zappos: customer service as the brand
Zappos sold shoes online — once thought impossible — by offering free shipping both ways, 365-day returns, and famously generous phone support, before Amazon bought it for about $1.2 billion.
By Shivam Bhandari · Reviewed 31 October 2026 · How we write
by the numbers
- Return window
- 365 days, free both ways
- Pay-to-quit offer to new hires
- about $2,000
- Gross sales (2008)
- over $1 billion
- Amazon acquisition (2009)
- about $1.2 billion
What happened
Nick Swinmurn started the company in 1999 after failing to find shoes he wanted. To test demand he photographed shoes in local stores and posted them online; when orders came in, he bought them at full price and shipped them. Tony Hsieh invested and later became CEO.
People were reluctant to buy shoes without trying them on. Zappos removed the risk: free shipping, free returns, and a 365-day return window. Its call centre in Las Vegas had no scripts or time limits — one call reportedly lasted over ten hours. It even offered new hires about $2,000 to quit after training, to filter out people who weren't committed.
Gross sales passed $1 billion in 2008. In 2009 Amazon acquired Zappos for about $1.2 billion in stock, keeping it as a separate brand and culture.
Timeline
- 1999
Demand tested by photographing shoes in stores.
- 2000
Tony Hsieh joins as co-CEO.
- 2008
Gross sales pass $1 billion.
- 2009
Acquired by Amazon.
what made it work
- Removed the main purchase fear with free, long returns.
- Treated service as marketing — happy customers told friends.
- Hired and paid to protect a service-first culture.
- Tested demand before building inventory.
the lesson
When customers fear a purchase, removing the risk can turn a ‘can't sell online’ product into a category leader.
Apply it to your business
- 1Identify your customer's biggest fear and remove it.
- 2Spend on service where it creates word of mouth.
- 3Test demand before you stock up.
Laws at work in this story
Figures are rounded and drawn from public reports, company filings and widely cited coverage at the time. Check the company's latest filings before relying on any number.