I had a board of directors meeting last night for KIPP Bayview Academy, which for me is a fun board because it's smaller than most and has a nice social element to it (everyone is around the same age, no egos, nice people). In one of the crosstalk conversations a comment was made about Zappos.com and all of the women in the room immediately started talking about how great this site is.
What was interesting to observe was that they didn't talk about any of the features of the site, and selection was only briefly commented on; what really made this a great service was the customer service and the community that they have built around it, the "buyer's favorites" is an good example of this.
This reminded me that many technology-enabled companies forget that they are ultimately in the customer service business and if they don't get that right then everything else is academic and suboptimized.
BTW, I asked a random selection of women in my office today if they had heard of this site... not only did every one of them know it, they were all customers. I may look out-of-the-loop for not knowing this site, but we never invested in specialty retail and I'm not a frequent shoe shopper so you'll have to give me a little lattitude.
PS- a quick search shows that Matt wrote about this a couple of weeks ago.
PPS- and while I'm on Matt's post, Sand Hill Slave is a great blog on the venture business.