A recent Business Week article, “Zappos Retails its Culture” offered a tantalizing proposition. After all, if an entrepreneur creates a successful business, why not sell the concept to other entrepreneurs interested in starting up new ventures?
So thought Tony Hsieh, Zappos Chief Executive. So, beginning last summer, Zappos began offering two day seminars at $4,000 a pop to share the successful Internet retailer’s recipe for recreating “the essence of its corporate culture”. Now, there are plans to offer these seminars once per quarter in 2010.
There’s no doubt that Zappos is a successful online shoe retailer. In fact, in spite of the challenging retail climate of the past year, Zappos enjoyed a double digit sales increase. Amazon’s Jeff Bezos was suitably impressed and purchased Zappos this past November for shares worth $1.2 billion.
It’s obvious the company represents a strong, viable retail brand, when a great many heritage retail brands are in trouble. So why not share the formula for success by offering seminars?
Hsieh’s seminars center on his culture where the topics of hiring, employee compensation, customer interaction and creating a positive work environment are top of mind. Hsieh himself, as well as a couple dozen members of his staff conduct these seminars.
Some of Zappos employee policies, as outlined in the article:
- Call center operators’ initial salary is $11.00 per hour.
- There are no employee bonuses.
- There are no 401K matching contributions. Hsieh believes productive employees derive the most satisfaction from helping their customers.
- Customer service employees enjoy plenty of freedom—and latitude in doing their jobs. They can spend hours servicing one customer—even directing them to competitors’ web sites. Whatever it takes to satisfy the customer’s needs is job #1. Having fun while doing it is part of the job.
- Over 95% of Zappos transactions occur online, so phone calls to customer service reps are viewed as opportunities to connect with consumers and “wow them” according to Hsieh.
- Top priority: to establish emotional connections with the customer.
In reading all of this, a number of questions came to my mind, and I’m sure, to yours, too.
- Do you think the Zappos culture can be easily replicated in other companies? Do you think it should be?
- Does it make a difference if an entrepreneur who is starting up a new company tries to replicate the Zappos model, versus an established company trying to change an existing culture?
- Do you believe each company has its own, unique culture based on its mix of executives and employees? Why or why not?
- Lastly, do you think Zappos’ employee policies would work for most companies? Why or why not?
I’d love to hear from you.