Las Vegas Sun

March 6, 2015

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Website pricing mistake costs $1.6 million

Click to enlarge photo CEO Tony Hsieh poses with some of his company's merchandise.

A "big mistake" cost Henderson-based about $1.6 million Friday after a pricing problem surfaced on the company's sister website.

According to the company's Inside Zappos blog, the website capped prices on all items at $49.95 from about midnight to 6 a.m. Friday.

The sister site indicates it offers brand names up to 75 percent off. But some customers Friday morning got much steeper discounts, with citing a "big mistake in our pricing engine" as the cause of the problem.

The site was shut down while the problem was fixed, according to the blog.

"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," according to the blog post from Aaron Magness,'s director of brand marketing and business development. "However, it was our mistake. We will be honoring all purchases that took place on during our mess up." CEO Tony Hsieh posted his reaction to the news Sunday on his Twitter account.

"$1.6 million mistake on sister site," he wrote. "I guess that means no ice cream for me tonight." was acquired last year by The Henderson company, which reached $1 billion in annual sales two years ago, has some 1,300 employees.

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