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Why Zappos Pays New Employees to Quit—And You Should Too

discussionleader.hbsp.com — Zappos sells shoes —lots of them—over the Internet. After a week or so of employ with the ccompany, it’s time for what Zappos calls “The Offer.” “If you quit today, we will pay you for the amount of time you’ve worked, plus we will offer you a $1,000 bonus.” Zappos actually bribes its new employees to quit! Why?...

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  • dougvfr750, on 05/20/2008, -1/+103Interesting approach to finding out just how committed the employee is to the company. If I had to work the call center line I'd have to be committed, but in a different way. It would be a big white building with padded walls.
    • evan119, on 05/20/2008, -5/+8*ccompany
    • theforrester, on 05/20/2008, -2/+3very funny :)
    • Charlotte_Web, on 05/20/2008, -0/+60If they will cut me a check for $500, I promise to not even send a resume.
      • publiclurker, on 05/20/2008, -2/+8I'll sub contract out the not sending of your resume to India for $1.50
  • mvanhorn, on 05/20/2008, -4/+86I really thought 0% of employees would take it.. but I was surprised to see "About ten percent of new call-center employees take the money and run" I guess they are working in a call center..
    • cha5e, on 05/20/2008, -2/+11Agreed. Unless someone else is willing to pay your expenses, that $1000 will likely only last you 2-5 weeks, which may or may not be enough time to find another job.
    • solistus, on 05/20/2008, -0/+19I would take it in a heartbeat. A $1000 bonus for one week, even assuming it's full time, is a bonus of $25/hr! Now, if I were looking for a long-term job and the best place I could start was a call center for an online shoe retailer, I guess I wouldn't (which is the point from Zappos' perspective - the isolate this group of people), but assuming you have time to find a new job and/or aren't looking for long-term employment (summer/winter break job, need a short-term capital boost, etc.), it's hard to beat that level of compensation for your time.
      • Firehed, on 05/20/2008, -1/+5Maybe. The idea behind this is that the company is providing an environment that you'll want to stay in, and presumably the hiring process would weed out freeloaders such as yourself.
        • Solis, on 05/20/2008, -18/+2Freeloaders? Right. Anyone who willingly works in a call center needs to be tortured to death anyway. Every last one of them are wastes of human flesh.
        • ChrisTaransucks, on 05/20/2008, -36/+0SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!! SOLIS IS A FAG!!!
        • mockupscaledown, on 05/20/2008, -0/+6It's been a banner day for blocking people.
        • haydesigner, on 05/21/2008, -1/+5@ChrisTaransucks: "SOLIS IS...."

          Jesus...
          Grow.
          The *****.
          Up.
        • Nitrodist88, on 05/21/2008, -0/+3Solis, so who do you expect to answer your call when you call up Amazon (etc.) with questions about your account (etc.)?
        • solistus, on 05/21/2008, -1/+2Solis: a job's a job. Grow up.

          Chris: welcome to mass report+banville. Hope you enjoyed your stay on Digg.

          Firehead: I hardly think that being economically rational when it comes to paid employment constitutes freeloading. There's a reason we're paid to work; it's at least theoretically an optional arrangement entered for mutual benefit. If a company wants to offer me a deal like Zappos', it doesn't make me a freeloader to accept the deal. At any rate, I think The Offer exists because they _can't_ screen out people like me during the hiring process. Low-end jobs like these have high turnover rates from people actually only planning on short-term employment or who jump ship as soon as a better job opens up somewhere else. This is a method of eliminating those people ASAP to replace them with someone who will stick around. I imagine training and experience are crucial for high success rates as a call center rep, so the company has an incentive to do something like this to help maintain a stable, long-term employee base.
    • brundlefly76, on 05/21/2008, -0/+5Working a call center is not an especially rewarding job, even if Zappos works hard to make it better than average for their employees. However, inertia keeps a lot of people at jobs they don't like - which is why Zappos gives them the $1000 to be decisive, not passive.
    • L.Jenkins, on 05/21/2008, -0/+6"About ten percent of new call-center employees take the money and run"

      "About ninety percent wish they had taken the money and run 6 months down the road."
  • BadgerGravling, on 05/20/2008, -3/+53Having followed various Zappo employees, including the CEO on Twitter, they're definitely a company worth watching.
    • jmpeagle, on 05/20/2008, -1/+13well they are fully private so watching them does nothing
  • Ninjao, on 05/20/2008, -2/+17Interesting approach, if you have the capital to resort to such measures then this sounds like quite the plan.
    • mal1964, on 05/20/2008, -2/+1Its an employer market and they can get away with it right now. In the 90's when it was an employee market this approach would be suicide.
  • gaffer13, on 05/20/2008, -3/+43Zappos.com does the little things that other companies aren't willing to try and are building a $1 Billion empire by doing so.
    • bunki8, on 05/20/2008, -0/+8One thing to note about their $1 Billion of sales is that they have a very very small profit margin. Love their company, hope their able to grow that margin in the future and retain practices such as these.
      "Last year it [Zappos] made $10 million pretax on $528 million in revenue after returns. He wasn't kidding about the easy return policy. Gross sales were $840 million." -- Forbes article "A Step Ahead"
      • BurnTees, on 05/20/2008, -0/+4however, people buy from Zappos because they KNOW they can return if they need to. How many sales do you think they made just because that fact? I'm sure they plan on a certain number of returns...just like any business that makes a returnable product.

        Personally, I've bought a bunch of pairs of sneakers from Zappos and I've always been VERY happy.
    • arcooke, on 05/21/2008, -1/+1No wonder they have a "$1 billion empire".. their prices are outrageous. I've never heard of the site before, and I went and checked mens shoes "under $39.99".. the only shoes under that price are freakin flip flops.. and just about every pair is over $30. For flip flops!!

      I'm a big supporter of discount shoe brands/stores. Sometimes you'll find some pretty bad quality shoes, but most of the time, the shoes are just as good as the name brands.

      I bought a pair of Stanley (as in, the tools) steel-toed leather work boots from Payless about 8 years ago for $20, back when $120 Doc Martins were the big thing. They are still in perfect condition (just dirty), have plenty of tread left, and are the most comfortable pair of shoes I've ever owned.. and I wear them almost daily.
  • mciampa1214, on 05/20/2008, -0/+156Something tells me the initial hiring process must be somewhat strenuous. Otherwise there would be all kinds of people just going to collect their $1,000, right?
    • narcofiche, on 05/20/2008, -0/+32Especially after seeing this on Digg.
    • trshtehdsh, on 05/20/2008, -0/+13not sure if i'm giving away any secrets, but so far i've been to a job fair, to get to the next level you have to pass a typing test (25 words / 85% accuracy. not very difficult for the average digger...) then a level of skills testing - acting as a customer and typing in orders; then an interview, and then reference checks (this is for the call center team position).

      They want you to be somewhat capable skill wise, but they really want you to fit in to the Zappos culture - which is definitely unique - so i bet the majority of candidates wouldn't be able to cope with the "fun and a little weird" environment, not to mention the scheduling for the CLT (call center) positions are schedule almost randomly, with shifts starting from 4PM till 3 PM. So not tedious, but you definitely have to have the right "stuff" to get in there.
      • psylence, on 05/20/2008, -3/+3As in no education and low job prospects?
      • rrbest, on 05/21/2008, -0/+1The zappos culture sounds like the type of work environment that would make me want to go postal.
    • daizaru, on 05/20/2008, -0/+4I think they want a large number of applicants, this is certainly a good philosophy. The job must be pretty good for people to not take the money and run. Unless I planned to work there for years as a telemarketer(telephone sales representative) then I'd probably just use it as an in between to fund finding a better job. With only 10% doing it though the job must have it's own perks.
      • trshtehdsh, on 05/20/2008, -0/+5i'm crossing my fingers to get on the customer loyalty team - aka the call center- (and mind you, i'd be leaving a better paying job for the zappos position), because telemarketing is NOT what they do. They take calls from customers who need help with orders, finding shoes, etc. and help them do just that. There is NO UPSELLING! i've been told you can even get fired for trying to upsell. There isn't a quote on how many sales you have to make, they don't time your calls, there isn't a time limit on how long you can talk to a customer - really, it's completely different than any other customer service line you've ever heard of. they just want their customers to be happy, and that's how they make their money, not upselling or cold calling or any of that crap.
    • Nesh, on 05/20/2008, -6/+1Well, you have to work there for 5 weeks to get "The Offer." So I'm not sure it'd be really worth your time.
      • jabelar, on 05/21/2008, -0/+0You get paid full pay for your time, plus a $1000 bonus to quit.
      • krusader3z, on 05/21/2008, -0/+2What he was saying is that to some people $1000 is not a lot of money, and not worth the hassle.
        I know this isn't the majority of people out there, but there are those among us that earn at such levels where 1K isn't worth 5 weeks followed by a "good-bye"

        /smug
  • MapShatter, on 05/20/2008, -72/+12Mr. Babyman is like that kid in grade school that always tries to hang out with the cool kids, even though they constantly tell him to go away
    • MrBabyMan, on 05/20/2008, -15/+108You joined digg 2 days ago. Since then you've dugg 3 stories and made 5 comments, 4 of which are about me. Obsess much?
      • BoonTobias, on 05/20/2008, -28/+2oh baby, you know what i'm gonna do to your gotee when i see you in prison, right?
        • purplehaze420, on 05/20/2008, -0/+23Why would he end up in prison? And why would you be there ?
        • rrbest, on 05/21/2008, -0/+1purplehaze your comment made me laugh more than any others today.
      • metaliq, on 05/20/2008, -2/+7Seems that way.
      • isiz, on 05/20/2008, -34/+8Seriously, ***** off Mrbabyman, the majority of Digg wants you out.
        • ultrafez, on 05/20/2008, -2/+7Have you asked everyone for their opinion? No? Didn't think so. So I would STFU and stop trying to represent the entire population of Digg by putting your own personal views onto everybody else.
        • isiz, on 05/21/2008, -4/+2Whatever, speak for yourself. I'm just sick of seeing power users having so much control over what gets on the front page, maybe if Mrbabyman wasn't such an attention whore (re-submitting stories and lying about it, threatening to leave to get diggers to suck his dick) I wouldn't care.
        • Nitrodist88, on 05/21/2008, -1/+4Oh really? You're sick of all the power users having so much control since you've been apart of Digg for a total of 15 days? You must be really impatient.
      • heypetray, on 05/20/2008, -2/+4Wow. Just went you think he doesn't read the comments of his own submissions.. POW! Babyman comes and takes out the trash. Impressive. How exactly do you manage to have 25 hour long days?
    • MapShatter, on 05/20/2008, -44/+8Wow...Mr. Babyman just accused someone else of "obsessing" much. You point out the fact that that I've only dugg 3 stories...as if that somehow makes me more lame than someone who has to fight, claw, and step over others just so he can get his e-popularity up. Don't ever tell someone else that they are more pathetic than you, because well, you pretty much define it. Do I have to dupe articles, sacrifice all my free time, cry about Digg over twitter, and steal ***** from reddit , and stalk every cracked article 24/7 before I have the jurisdiction to claim that you are a ***** loser? Jesus just take a hint and go away.
      • MrBabyMan, on 05/20/2008, -8/+45If I really bother you that much that you need to devote most of your Digg activity to me, simply click 'Block User' under my name. I really don't think you will, however, because looking at your activity, it appears that trolling me was the sole reason you created this digg account.
      • PinkFloydFan, on 05/20/2008, -2/+36Map, you're bringing a lot of negative vibes into the digg community. Just enjoy the stories, who cares where they come from. If you can't just enjoy the content of the story despite who submitted it then take a hint and at least have the decency to leave your trash talking out of the comments page. Thanks.
      • romistrub, on 05/20/2008, -1/+17lmao @ MapShatter

        You're trying too hard. If you're going to go on a rant, at least be entertaining. Because right now, you're just pathetic.
    • dracostimpy, on 05/20/2008, -2/+6Get a room, perverts!
    • SpectralSounds, on 05/20/2008, -6/+7Who gives a ***** about Mr. Babyman and what he says or does. Secondly, who gives a ***** what you have to say about Mr. Babyman?

      The both of you are drama queens.
    • metaliq, on 05/20/2008, -1/+2You seem like the prick at parties that thinks his jokes are funny and laughs really loud, trying to get other people into them, and thinks he is actually friends with everyone, but everyone always asks "who invited that douchebag?" when they see you.
    • iticu, on 05/20/2008, -0/+10On the internets, we try to make fun of people to make ourselves feel good.
      MrBabyMan is alright, people like you that MAKE ACCOUNTS to put down other people aren't.

      Though you'll probably be thinking "lulz i dont care im anon i do it for teh lulz newfagz", which is kind of pathetic and dodging reality.

      (In before the reply that says something like; "Internets; Serious buisness")
    • willemmulder, on 05/20/2008, -0/+4Assuming that hanging out with the 'cool' kids is a good thing is even worse... And what MrBabyMan was anytime anywhere doesn't matter to anybody, now does it?
    • Gwennyk, on 05/20/2008, -0/+2Hey MapShatter, cry more?
    • Nitrodist88, on 05/21/2008, -0/+1Go away, Mapshatter. Stop hanging out with us.
    • cwabray, on 05/21/2008, -0/+1http://www.howtonotsuck.com/assets/images/arguing_ ...
  • terrizance, on 05/20/2008, -9/+2951. Get 1 week of vacation at current job
    2. Get hired at Zappos
    3. Take "The Offer"
    5. Go back to work, $1,000 richer (profit!!!)
    • pilot3033, on 05/20/2008, -12/+54*5 weeks

      You need to go through the month of training first.
      • Avaseal, on 05/20/2008, -1/+10But I only have TWO weeks paid vacation! Gah..at this rate I'll never get those Robocopesque Bionic Arm Implants
      • daizaru, on 05/20/2008, -1/+3It read to me that 1 week into the training you are given the offer, not 1 week after.
        • pilot3033, on 05/20/2008, -0/+2perhaps you are correct, I read it as "4-weeks of training, an a week on the job before 'the offer.' "
          *shrug*
      • karlhite, on 05/20/2008, -0/+2"about a week in" they make the offer.
    • FlyingSpaghetti, on 05/20/2008, -1/+69You forgot step 4. ???
    • juzcallmeg0d, on 05/20/2008, -8/+13no, its 1 week into the training that they offer the money
      • superkendall, on 05/20/2008, -3/+6Read again. Four weeks training, then they get a week of real in-depth experience - THEN they get the offer. The article was quite clear.
        • UtopianComplex, on 05/20/2008, -2/+3Read again. 1 week into the training they get the offer. The article was quite clear.

          "So when Zappos hires new employees, it provides a four-week training period that immerses them in the company’s strategy, culture, and obsession with customers. People get paid their full salary during this period.

          After a week or so in this immersive experience, though, it’s time for what Zappos calls “The Offer.”"
        • karlhite, on 05/20/2008, -2/+2Dead on. "After a week or so in this immersive experience..." The antecedent of "this" is the four weeks training, dill holes.
    • woofers07, on 05/20/2008, -1/+13and you spent your vacation working.
      • funkyloki, on 05/20/2008, -0/+3Yes, but you made $1000. I think that tradeoff might be worth it, depending on how much you make during a week at your current job from which yo are vacationing.
    • willemmulder, on 05/20/2008, -1/+3step 2 is the tricky part I guess... And they maybe have some list-of-shame-sort-of-thing to publish who took The Offer?
    • caramba420, on 05/20/2008, -3/+141. Hire people
      2. Give away $1000
      3. ????
      4. Profit
    • freakygeeky, on 05/20/2008, -4/+15That doesn't work very well if you get paid > $1,000/week at your normal job.
      • MadOtaku, on 05/20/2008, -0/+3You get paid during the training too. So lets pull a number out of my ass and say that you'll make $750* for the training week, take the offer and you will have collected $1,750 for the week.

        *I have no clue what you make at a call center.
        • rrbest, on 05/21/2008, -0/+2you won't make 750 a week. If you're lucky you'll make half that.
      • thanacus, on 05/20/2008, -0/+12Paid vacation, yo.
      • asskicker32, on 05/20/2008, -0/+12take "vacation" so you get paid from your normal job
        *facepalm*
      • fakeid781, on 05/20/2008, -0/+9it does if you get paid vacation
  • DrCrankenstein, on 05/20/2008, -3/+24Zappos rules.

    Weird name, but they're obviously doing a lot of things differently, and right.
    • pilot3033, on 05/20/2008, -1/+25"Zapatos" means "shoes" or "sneakers" in spanish, the name must be a derivative.
      • Goblin, on 05/20/2008, -1/+8Or, like many web companies it seems, the domain name was available.
      • univerio, on 05/21/2008, -1/+3So Zapatos would be its integral?

        (har, har...)
    • paulofmandown, on 05/20/2008, -5/+1They charge $20 more for their shoes and paint the phrase "FREE SHIPPING" on 'em. It's a little deceptive, but it boosts the hell out of sales, for sure.
      • rrbest, on 05/21/2008, -0/+1Currently, you're getting buried... but come on people, there's no such thing as a free lunch
    • Epik, on 05/20/2008, -0/+8lol isn't Zappos a pokemon or something?
      • asskicker32, on 05/20/2008, -0/+11Uh, youre thinking of Zapdos, the legendary bird of lightning.
        • blackdeath88012, on 05/20/2008, -1/+5Dugg for "legendary" in your description.
    • almightyzam, on 05/20/2008, -0/+2I was kicking myself every time i saw one of their commercials because i couldn't figure out what their product was, so i always assumed it was that lighter company...finally i realized that the lighter company is zippo...now i'm telling this story on digg...

      i'm going outside
  • wynja, on 05/20/2008, -1/+10Now that's an amazing strategy for employee weeding. I love it.
  • bunki8, on 05/20/2008, -0/+4Definitely an amazing company. Been reading business articles on these folks for a while. Can only hope this customer service will spread to other corporations when they realize how viral it makes their company.
  • BryanG412, on 05/20/2008, -5/+3mirror?
  • JacksonDane, on 05/20/2008, -10/+0I quit smoking and all my company gave me was this lousy t-shirt
    • FlyingSpaghetti, on 05/20/2008, -0/+10That's because they don't give a *****.
    • willemmulder, on 05/20/2008, -0/+3the guy that started with a paperclip has a lot more than $1000 now... don't give up so fast! I'm well willing to exchange your shirt for one of mine, but a bigger size... there you go!
  • Tamant, on 05/20/2008, -3/+44I've worked in a call center before and if you offered me $10 to quit, I would..
  • CharlesSaint, on 05/20/2008, -13/+16For once I was pleasantly surprised by this MrBabyMan submission. Color me impressed.
  • diggit08, on 05/20/2008, -3/+4mirror. srsly. harvard can't handle digg?
    • CharlesSaint, on 05/20/2008, -1/+7Why Zappos Pays New Employees to Quit—And You Should Too

      Posted by Bill Taylor on May 19, 2008 10:06 AM

      I spend a lot of time visiting with companies and figuring out what ideas they represent and what lessons we can learn from them. I usually leave these visits underwhelmed. There are plenty of companies with a hot product, a hip style, or a fast-rising stock price that are, essentially, one-trick ponies—they deliver great short-term results, but they don’t stand for anything big or important for the long-term.

      Every so often, though, I spend time with a company that is so original in its strategy, so determined in its execution, and so transparent in its thinking, that it makes my head spin. Zappos is one of those companies. Two weeks ago, I paid a visit to Zappos headquarters in Henderson, Nevada, just outside Las Vegas, and spent time with CEO Tony Hsieh and his colleagues. I could write a whole series of posts (and just might) about what I learned from this incredible operation. But I want to focus this post on one small practice that offers big lessons for leaders who are serious about changing the game in their field—and filling their organization with people who are just as committed as they are.

      First, some background. As most of you know, Zappos sells shoes—lots of them—over the Internet. The company expects to generate sales of more than $1 billion this year, up from just $70 million five years ago. Part of the reason for Zappos’s meteoric success is that it got the economics and operations right. It offers customers a huge selection—four million pairs of shoes (and other items, such as handbags and apparel) in a warehouse in Kentucky next to a UPS hub. (If Imelda Marcos visited that warehouse she'd likely have a coronary on the spot.) It also offers free delivery and free returns—if you don’t like the shoes, you box them up and send them back to Zappos for no charge.

      So the value proposition is a winner. But it’s the emotional connection that seals the deal. This company is fanatical about great service—not just satisfying customers, but amazing them. The company promises free, four-day delivery. That’s pretty good. But most of the time it delivers next-day service, a surprise that leaves a lasting impression on customers: “You said four days, but I got them the next morning.”

      Zappos has also mastered the art of telephone service—a black hole for most Internet retailers. Zappos publishes its 1-800 number on every single page of the site—and its smart and entertaining call-center employees are free to do whatever it takes to make you happy. There are no scripts, no time limits on calls, no robotic behavior, and plenty of legendary stories about Zappos and its customers.

      This is a company that’s bursting with personality, to the point where a huge number of its 1,600 employees are power users of Twitter so that their friends, colleagues, and customers know what they’re up to at any moment in time. But here’s what’s really interesting. It’s a hard job, answering phones and talking to customers for hours at a time. So when Zappos hires new employees, it provides a four-week training period that immerses them in the company’s strategy, culture, and obsession with customers. People get paid their full salary during this period.

      After a week or so in this immersive experience, though, it’s time for what Zappos calls “The Offer.” The fast-growing company, which works hard to recruit people to join, says to its newest employees: “If you quit today, we will pay you for the amount of time you’ve worked, plus we will offer you a $1,000 bonus.” Zappos actually bribes its new employees to quit!

      Why? Because if you’re willing to take the company up on the offer, you obviously don’t have the sense of commitment they are looking for. It’s hard to describe the level of energy in the Zappos culture—which means, by definition, it’s not for everybody. Zappos wants to learn if there’s a bad fit between what makes the organization tick and what makes individual employees tick—and it’s willing to pay to learn sooner rather than later. (About ten percent of new call-center employees take the money and run.)

      Indeed, CEO Tony Hsieh and his colleagues keep raising the size of the quit-now bonus. It started at $100, went to $500, and may well go higher than $1,000 as the company gets bigger (and it becomes even more difficult to maintain the all-important culture and obsession with customers.)

      It’s a small practice with big implications: Companies don’t engage emotionally with their customers—people do. If you want to create a memorable company, you have to fill your company with memorable people. How are you making sure that you’re filling your organization with the right people? And how much are you willing to pay to find out?
  • elpepe, on 05/20/2008, -4/+2Article text or mirror please.
  • wra716, on 05/20/2008, -2/+14mirror (from cache)

    http://209.85.173.104/search?q=cache:1h3_weLby_8J: ...
  • Hackenslacker, on 05/20/2008, -3/+119Looks like their web server took the offer and left.
  • digitallysick, on 05/20/2008, -2/+2Zappos rocks, i ordered some shoes with free shipping. I expected them to arrive in about a week, hardly 3 days later they were at my door step! Amazing service. Oh yeah, if my job gave me this offer, and handed me the check i would be gone!
    • readysetno, on 05/20/2008, -1/+4on a similar note, i bought a pair of shoes a few months ago with the cheapest shipping they offer. i think it was 5-7 day ground. got an email about a half hour after ordering saying they were upgrading my shipping at no extra cost. got the shoes the NEXT DAY, less than 24 hours after ordering. phenomenal company - i'm a customer for life.
      • dmange20, on 05/20/2008, -1/+2same situation for me!
        ordered them at 9pm got them next day at 11am.
        incredible company.
  • maxxwizard, on 05/20/2008, -4/+0site down... cache down... need a mirror.
  • MrTito, on 05/20/2008, -5/+68Why Zappos Pays New Employees to Quit—And You Should Too

    Posted by Bill Taylor on May 19, 2008 10:06 AM

    I spend a lot of time visiting with companies and figuring out what ideas they represent and what lessons we can learn from them. I usually leave these visits underwhelmed. There are plenty of companies with a hot product, a hip style, or a fast-rising stock price that are, essentially, one-trick ponies—they deliver great short-term results, but they don’t stand for anything big or important for the long-term.

    Every so often, though, I spend time with a company that is so original in its strategy, so determined in its execution, and so transparent in its thinking, that it makes my head spin. Zappos is one of those companies. Two weeks ago, I paid a visit to Zappos headquarters in Henderson, Nevada, just outside Las Vegas, and spent time with CEO Tony Hsieh and his colleagues. I could write a whole series of posts (and just might) about what I learned from this incredible operation. But I want to focus this post on one small practice that offers big lessons for leaders who are serious about changing the game in their field—and filling their organization with people who are just as committed as they are.

    First, some background. As most of you know, Zappos sells shoes—lots of them—over the Internet. The company expects to generate sales of more than $1 billion this year, up from just $70 million five years ago. Part of the reason for Zappos’s meteoric success is that it got the economics and operations right. It offers customers a huge selection—four million pairs of shoes (and other items, such as handbags and apparel) in a warehouse in Kentucky next to a UPS hub. (If Imelda Marcos visited that warehouse she'd likely have a coronary on the spot.) It also offers free delivery and free returns—if you don’t like the shoes, you box them up and send them back to Zappos for no charge.

    So the value proposition is a winner. But it’s the emotional connection that seals the deal. This company is fanatical about great service—not just satisfying customers, but amazing them. The company promises free, four-day delivery. That’s pretty good. But most of the time it delivers next-day service, a surprise that leaves a lasting impression on customers: “You said four days, but I got them the next morning.”

    Zappos has also mastered the art of telephone service—a black hole for most Internet retailers. Zappos publishes its 1-800 number on every single page of the site—and its smart and entertaining call-center employees are free to do whatever it takes to make you happy. There are no scripts, no time limits on calls, no robotic behavior, and plenty of legendary stories about Zappos and its customers.

    This is a company that’s bursting with personality, to the point where a huge number of its 1,600 employees are power users of Twitter so that their friends, colleagues, and customers know what they’re up to at any moment in time. But here’s what’s really interesting. It’s a hard job, answering phones and talking to customers for hours at a time. So when Zappos hires new employees, it provides a four-week training period that immerses them in the company’s strategy, culture, and obsession with customers. People get paid their full salary during this period.

    After a week or so in this immersive experience, though, it’s time for what Zappos calls “The Offer.” The fast-growing company, which works hard to recruit people to join, says to its newest employees: “If you quit today, we will pay you for the amount of time you’ve worked, plus we will offer you a $1,000 bonus.” Zappos actually bribes its new employees to quit!

    Why? Because if you’re willing to take the company up on the offer, you obviously don’t have the sense of commitment they are looking for. It’s hard to describe the level of energy in the Zappos culture—which means, by definition, it’s not for everybody. Zappos wants to learn if there’s a bad fit between what makes the organization tick and what makes individual employees tick—and it’s willing to pay to learn sooner rather than later. (About ten percent of new call-center employees take the money and run.)

    Indeed, CEO Tony Hsieh and his colleagues keep raising the size of the quit-now bonus. It started at $100, went to $500, and may well go higher than $1,000 as the company gets bigger (and it becomes even more difficult to maintain the all-important culture and obsession with customers.)

    It’s a small practice with big implications: Companies don’t engage emotionally with their customers—people do. If you want to create a memorable company, you have to fill your company with memorable people. How are you making sure that you’re filling your organization with the right people? And how much are you willing to pay to find out?
    • Hangly, on 05/21/2008, -0/+1“You said four days, but I got them the next morning.”

      Amazon does that too. I love it.
      • rrbest, on 05/21/2008, -0/+1Credit is given to the companies, but shouldnt UPS be getting the credit?
  • Vassili84, on 05/20/2008, -6/+4ya zappos owns got my shoes from them free overnight shipping ftw! ;D
  • diggit08, on 05/20/2008, -3/+2Mirror: http://www.mubinahmed.com/why-zappos-pays-new-empl ...
  • Matt2k, on 05/20/2008, -8/+9Because doing so gets them a frontpage article on Digg ?
    I never heard of them before this. My finger is clean off the pulse of the Internet, and stuck somewhere up its butthole I guess.
    • sovietninja, on 05/20/2008, -0/+4Which sadly has done nothing to stop the proverbial diarrhea of the internet from coming out...
    • PhoenixAvatar2, on 05/20/2008, -0/+1They sell shoes. Why are you surprised that you never heard of them before?
    • GiJoeBob, on 05/20/2008, -0/+2You have enticed a hearty chortle from my gut! Well done sir!!
  • rsek, on 05/20/2008, -2/+1i'll know someone who works there, i'll ask him
    • sapped, on 05/20/2008, -0/+8When you come back can I borrow your time machine?
    • Firehed, on 05/20/2008, -0/+1Well obviously he didn't take the offer... what's to ask about?
  • trshtehdsh, on 05/20/2008, -0/+10i'm trying to get a job at zappos, the company looks amazing to work for with a really great "work" environment, they really are about two things: customers, and their employees. I've never heard so many people say they *like* going to work, but every zappos employee i've met is totally in love with the place. and it's things like this that show they "walk the walk" when it comes to taking care of their employees, even if they might leave for other opportunities. not to mention the nap pods and a full time life coach for employees to talk to .... i really hope i get in :)
    • abyssknight, on 05/21/2008, -0/+2If you've got PHP & Perl they'll hire you. I had a phone screening, but couldn't bring myself to move out there.
  • dafragsta, on 05/20/2008, -4/+1
    • diggit08, on 05/20/2008, -0/+1I wonder if they have any links to Al-Qaeda?
    • MoofTheStoof, on 05/20/2008, -0/+1The article was about how they DON'T just hire anybody - just the ones who fit best. As for money, a billion dollars in revenue means they need people to keep the pace. I've been buying from them for a couple years now because my son and I have extra wide feet and zappos has decent prices, great service, and a selection of shoes you can't hardly find anywhere else.
    • boxoman, on 05/20/2008, -0/+1Do you know how hard it is to find good motivated employees to work at a call center? It probably takes 500 people to interview before they get 10 good people.
    • pensivewombat, on 05/20/2008, -0/+3Part of their strategy is to put their money into customer service rather than advertising so that they get word of mouth (or word of digg) buzz. They create a lot of repeat business rather than blowing their capital on superbowl ads and hoping 0.1% of the people who see the ad buy something, so they aren't as widely known as other huge retailers.
    • revjustin2, on 05/20/2008, -0/+1It's not important that they hire everyone...it's important that they hire a certain kind of person and in order to reach that small percentage of the population who fits that profile, you have to cast your nets far and wide. Zappos understands that what it sells is customer service, not shoes, and is putting it's money where it's mouth is. So many companies fail to recognize that you could literally sell poop to people if your service was stellar. IN the modern world, it almost doesn't matter what you sell, its how you sell it and then, how you stand behind the people who are buying it.
  • rsek, on 05/20/2008, -0/+8theywill sell some more shoes now i think
  • trshtehdsh, on 05/20/2008, -1/+3oh, and i should mention - free shipping BOTH WAYS!!!
  • cambob76, on 05/20/2008, -12/+5I'm not paying Zappos employees a God damned thing. Quit or stay, I don't care.
  • Barackalypse, on 05/20/2008, -5/+4We should try this with Congress. Start them out with a $100 million dollar bonus and every time they vote to pass a new law they lose $1 million of it. At the end of their term we pay them out.
    • sovietninja, on 05/20/2008, -0/+4That is not the same idea....
      • Barackalypse, on 05/20/2008, -2/+1Its the same principle, using money to incent behavior you want. In Zappos case it is incenting less than committed individuals to leave and that ensures the workers they have are ones that truly believe in the corporate culture. In my case its incenting Congress to pass fewer laws. I suppose to make it more similar I should offer them the money to just quit outright and hope that means there is never a quorum.
    • farboo, on 05/20/2008, -0/+4And if they pass one big omnibus bill with all the year's legislation in it?
      • Barackalypse, on 05/20/2008, -2/+0Good point, a safer system is to take last years federal budget and divide 10% of whatever cost savings they implement between them all. Incent them to make government smaller.
    • kingmanic, on 05/20/2008, -1/+3'We should try this with Congress. Start them out with a $100 million dollar bonus and every time they vote to pass a new law they lose $1 million of it. At the end of their term we pay them out.'

      Then the only bills you'd see passed are ones with more then a million in bribes attached and government would grind to a halt and none but corrupt politico's would survive.
      • Barackalypse, on 05/20/2008, -1/+2Why is government grinding to a halt bad? You act like its a machine that does something useful.
        • kingmanic, on 05/20/2008, -2/+2Right, so places where there aren't a government are just the happiest places on earth? I'm as cynical as the next guy about the government but I recognize that it's a necessary component to organize large masses of people. Seriously point to a single example of a stable anarchy.
        • cwabray, on 05/21/2008, -0/+1Iceland : 930 to 1262
          http://www.libertariannation.org/a/f13l1.html
  • thedogfatherx, on 05/20/2008, -2/+2I find this approach to building employee loyalty amazing. I hope it works out for the best. I've never really bought any shoes from them before because i've always found cheaper prices but i'll always take a look at them in the future.
  • hellbent88, on 05/20/2008, -15/+4mr.baby man get the ***** off digg
  • ChrisAlbon, on 05/20/2008, -1/+2My wife and I are huge Zappos fans. For the last few years I have ordered all my and my wife's shoes through Zappos and always been impressed.
  • cfoster100, on 05/20/2008, -3/+6Maybe they paid their webserver to quit?
  • RajAtWork, on 05/20/2008, -0/+1I am curious - how does Zappos compare with Endless as far as shoe-buying experience?
  • OUChevelleSS, on 05/20/2008, -0/+2Interesting...never heard of them before.
  • evilpettingzoo, on 05/20/2008, -0/+4Talk about coincidence I just got my shoes from zappos like 5 minutes ago. I love that company, if you've ever bought shoes and had to return them for one reason or another you would love them too. They ask you no questions, they never give you a hard time, and the people you speak to are friendly and polite. It really ingenious what they have done because I like the company so much I would never think of screwing them over, because I want them to do well. I only wish I could buy stock in the company, but as they have stated they will never go public. I guess they make to much damn money.
    • kingmanic, on 05/20/2008, -0/+5I think they make okay money and are happy doing it. I'm sure they could start screwing people and make more but happiness and contentment doesn't require you to have the largest car/SUV/penis/boobs/ass/bank account. Zappos seems happy at okay profits and huge sales.
      • evilpettingzoo, on 05/20/2008, -0/+2Well said. Since the new comment system came into play well thought out replies are making a comeback... thank god.
        I'm pretty sure public holding would kill this companies culture, so even though I would like them to offer stock, I know its not in their best interest to do so. I hope they keep around this size and not try branch out too much into other products beyond shoes. Its weird to think that amazon.com was once a bookstore.
    • paulofmandown, on 05/20/2008, -0/+0They do have amazing sales, but their rate of return is nearing 40%...
    • 5plic3r, on 05/21/2008, -0/+2Actually, they're currently laying the groundwork necessary to go public. It might happen!
  • SpoBo, on 05/20/2008, -3/+1Interesting ... I'll have to keep an eye on that guy and that company :)
  • sryan8913, on 05/20/2008, -1/+10companies that cater strictly to customer satisfaction without being blinded by profit are the future :)
  • rathofbuns, on 05/20/2008, -0/+2I've heard nothing but great things about Zappos both online and from friends and co-workers. I'd order from them except I have freakish feet that are different sizes.
  • rhkaloge, on 05/20/2008, -6/+1Ah Zappos, that reminds me of a funny story...
    but I don't feel like telling it to you.
  • EASwanson, on 05/20/2008, -1/+2I've been to Zappos HQ and it's a very impressive place. They have a lounge where people can take naps during the day time. Their cafeteria is stocked with food and drink and it's all free. Although Zappos is a great place to order shoes from I think they aren't actually making any money. Almost none of their product is their own so they are working with very low margins and they also have a very high return rate. They have a growing inventory of unsellable returned product... hope they can figure out a way to make some money off that billion in sales.....
    • geniusj, on 05/20/2008, -0/+2Sounds like a lot of companies in the bay area :)
    • stockjones, on 05/21/2008, -0/+2People said the same things about Amazon. Look at Amazon now and Zappos has far superior service although Amazon isnt bad. If you are a public company the profit you make is always dictated by your shareholders which puts a squeeze on companies and their requirements for earnings and profits.

      At 1 billion in sales Zappos could be making 3% margins and be just fine. They are a PRIVATE company so they dont have any need to suit earnings earmarks. Thats the bad about being a public company. Small margins or large margins and a happy successful company is all that matters if you are private. I hope zappos stays private because the minute they would ever go public, their service would go to ***** and everyone would hate working there.
  • houndeyex, on 05/20/2008, -2/+1404'd!
  • thal3s, on 05/20/2008, -15/+10Wait, wait.. I thought MrBabyMan was BAAAAAAAAAAAAAAAWWWWWWWWWWWWWWWWWWWWWWWWing the other day about leaving??

    Don't let the door hit you where the good lord split ya buddy!

    Somehow the other 1,000,000 of us can find a way to submit stories too.
  • themordecai, on 05/20/2008, -1/+11From the article: "...their friends, colleagues, and customers no what they’re up to at any moment in time."

    really, Harvard? didn't bother giving the article a once-over?
  • paidhima, on 05/20/2008, -0/+11Now this is some fantastic advertising... Not that I'm saying it's a plant as an advertisement, but this kind of good publicity is gold. I have never heard of this company before, but I think I'll buy my next pair of shoes from them. I love finding good online retailers (I'm also a rabidly loyal Newegg customer and have been since the year their site went live).
    • jer2eydevil88, on 05/20/2008, -0/+3I also am a loyal Newegg customer thanks to their excellent customer service and while I had never heard of Zappos before they have a new customer thanks to this PR article.
    • actionscripted, on 05/21/2008, -0/+2I have had nothing but wonderful experiences with Newegg.

      Several years back I purchased a 22" CRT from them online, only to have it arrive with two horizontal lines running across the screen, each roughly three inches from the top and bottom. I called and explained the problem to them and they paid for it to be shipped back to them and sent a new one -- zero hassles.

      It was after the second one arrived that one of my friends said, "You dumbass. Those are always going to be there on a CRT like that." followed by the explanation of why.

      Newegg didn't fight with the idiot consumer...even though in my case they should have.
  • TomPhoolery, on 05/20/2008, -2/+1buried, 404
  • HencheMann, on 05/20/2008, -0/+3All that you have heard about Zappos is TRUE. They are an awesome FORWARD THINKING organization. That said, I am amazed at how inept places like WaMu, AT&T and NORDSTROM are at client/ problem ownership. Get a real human on the phone and they are only more than eager to find and excuse to shuffle you off to another queue/ department. NO OWNERSHIP. NOTHING GETS SOLVED. Customers leave your business. Save us the fancy ad campaigns, pay your front line peons an actual living wage and empower them to own and solve client inquiries/ problems.
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