DSW sues Zappos.com – Forgets to Tell Them

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DSW issued a press release yesterday stating that they were suing Zappos.com, one of the largest online shoe retailers, for copyright infringement. Zappos.com, a company who’s online presence has recently skyrocketed as a result of their adaptation of various social-media endeavors, has yet to be notified directly of this lawsuit (1:30pm EST 5/13/08) other than by the press release.

This strange lack of communication was mentioned by the CEO of Zappos in a twitter comment stating: “Weird, just found out through a PRESS RELEASE that DSW filed a lawsuit against Zappos. Maybe phone call, letter, or email more productive??” (keep in mind you can’t use more than 140 characters on twitter, hence the broken english seen in most twitter comments)

He then later made another twitter comment posted late last night stating that he “Just checked with Zappos legal team and haven’t received any communication (phone call, letter, email) from DSW, just press release. Weird.”

Zappos.com has taken an interesting approach to embracing social media – their online shoe-store features four separate blogs, one of which is maintained by the CEO and COO (who not only blog frequently, but are always replying to consumer questions/remarks/feedback on twitter directly), as well as a twitter feed that lets you see any Zappos related comments/tweets in one collective source. You can check it out for yourself (it’s pretty cool, not to mention that this is the first brand I’ve seen pull this off successfully) by going to http://twitter.zappos.com. They also have a feature that lets you see a collected feed of what Zappos employees are twittering and it looks as if a lot of them are frequent users of twitter.com.

The consumer response to this lawsuit has already been rampant across blogs and other social-networking platforms, all seeming to take the side of Zappos.com and pointing the nasty PR finger at DSW and their recently launched online site. According to the press release, “The suit alleged that the name DSW was being used in multiple URLs, along with DSW store photographs, in an effort to mislead consumers into believing they were on a DSW related website.” DSW recently launched their online site after “numerous” customer requests for a way to shop 24 hours a day, 7 days a week.

Taken from a BNet article comparing the advertising campaigns used by the two retail shoe giants – “Analysts weren’t expecting DSW.com to open until the second half of 2008, but the $26.3 million project soft-launched April 23. DSW plans no marketing other than promotional flyers and e-mails to its 8.6 million loyalty card holders.” Compare that to their comment saying, “Zappos doesn’t do a lot of advertising, but what it does is brilliant. When you take off your shoes in the TSA line at 15 airports around the country, they go into bins with Zappos ads on the inside.” That may account for how Zappos.com has seen growth from an initial $1.6 million in 2001 to over $800 million last year meanwhile DSW has been facing not only a decline in store-bought purchases but also started off the first quarter of 2008 already down 1.7%. That being said, DSW is still the big-dog in this fight – last year taking in $1.41 billion in revenue.

If you want to see for yourself how a company can use social-media to their advantage, take a look at the Twitter accounts for the top two executives at Zappos and see what they’ve been talking about with their customers/random people on the ‘net:

The CEO – Tony Hsieh – can be found on twitter via: http://twitter.com/zappos
The COO – Alfred Lin – can be found on twitter via http://twitter.com/zappos_alfred

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