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How to Innovate in E-commerce

September 26, 2013
URL: http://www.entrepreneur.com/article/227933

After 14 years and a $1.2 billion acquisition by Amazon, Zappos still hasn't hung up its innovation hat. To sustain a startup-like attitude, in 2009 the Henderson, Nev.-based e-commerce giant launched Zappos Labs, a San Francisco division staffed with 11 full-time employees dedicated to exploring what consumers want out of their shopping experiences, then creating new ways for them to engage on the main site.

Director Will Young describes Zappos Labs as a "testing ground" where the team is given free rein to experiment. By design, the department's budget is flexible. "Our mission is to innovate, and the secret to coming up with real innovations in e-commerce is to treat it like traditional R&D," he says, noting that if money were the objective, the company could just invest in coupon apps and call it a day.

The goal is to figure out the perfect blend of commerce, social media and content. Zappos Labs has launched more than a dozen products; most are short-lived, but some hold great promise. Among them: