A $1.6 million dollar whoops from 6pm.com
I came across a post on Inside Zappos via a tweet by ‘The Experience Factor’ @jenkuhnpr. This ‘oops’ makes the Purple Goldfish Project at #407
“Hey everyone – As many of you may know (and I’m sure a lot of you do not), 6pm.com is our sister site. 6pm.com is where brandaholics go for their guilt free daily fix of the brands they crave. Every day, the site highlights discounts on products ranging up to 70% off. Well, this morning, we made a big mistake in our pricing engine that capped everything on the site at $49.95. The mistake started at midnight and went until around 6:00am pst. When we figured out the mistake was happening, we had to shut down the site for a bit until we got the pricing problem fixed.
While we’re sure this was a great deal for customers, it was inadvertent, and we took a big loss (over $1.6 million – ouch) selling so many items so far under cost. However, it was our mistake. We will be honoring all purchases that took place on 6pm.com during our mess up. We apologize to anyone that was confused and/or frustrated during out little hiccup and thank you all for being such great customers. We hope you continue to Shop. Save. Smile. at 6pm.com.
Nice job by 6pm.com to wear the hat and take their medicine. The willingness to honor to honor those discounted sales is admirable and more importantly a brand defining moment.
Today’s Lagniappe (a little something extra for good measure) – I love it when the folks from the C-Suite get down in the trenches. Zappos CEO Tony Hsieh (Shay) is never afraid to address an issue. Here is his update to the original blogpost:
“We have a pricing engine that runs and sets prices according to the rules it is given by business owners. Unfortunately, the way to input new rules into the current version of our pricing engine requires near-programmer skills to manipulate, and a few symbols were missed in the coding of a new rule, which resulted in items that were sold exclusively on 6pm.com to have a maximum price of $49.95. (Items that are sold on both 6pm.com and Zappos.com were not affected.)
We already had planned on improving our internal pricing engine so that it will have a much easier-to-use interface for our business owners. We are also planning on adding additional checks and balances to hopefully prevent this type of thing from happening again.
To those of you asking if anybody was fired, the answer is no, nobody was fired – this was a learning experience for all of us. Even though our terms and conditions state that we do not need to fulfill orders that are placed due to pricing mistakes, and even though this mistake cost us over
$1.6 million, we felt that the right thing to do for our customers was to eat the loss and fulfill all the orders that had been placed before we discovered the problem.
PS: To put an end to any further speculation about my tweet , I will also confirm that I did not, in fact, eat any ice cream on Sunday night.”
[Editors Note: Make your ice cream a triple scoop Tony. Well deserved on how you handled this situation, plus . . . you could use it. You look like you need to run around the shower just to get wet]
