Daniel Yee
If you’re looking for a brand new pair of shoes, I would suggest Zappos.com.
Zappos is an online retailer shop that mostly specializes in shoes. They have thousands of
different brands in just about every style, size, and color and have become one of the
most recognizable companies since it launched in 1999. Zappos has since revolutionized
how business is done and how people work. The company is probably best known for
their unique corporate culture and reputation of structuring their business around the
happiness of their stakeholders. Tony Hsieh, CEO of Zappos, focuses on having the best
company culture which is to have a fun and upbeat work environment that you won’t find
in most of corporate America.
Employees: A
Zappos holds their ten core values to a high standard that help guide their everyday
activity at the company:
1. Deliver WOW through service.
2. Embrace and drive change.
3. Create fun and a little weirdness.
4. Be adventurous, creative and open-minded.
5. Pursue growth and learning.
6. Build open and honest relationships with communication.
7. Build a positive team and family spirit.
8. Do more with less.
9. Be passionate and determined.
10. Be humble. ("Zappos.com Powered by Service")
The unorthodox culture builds around the employee’s satisfaction to lead great
customer service and brand strength. For example, Zappos encourages their employees to
have fun at work and goof off occasionally to promote a fun environment. Hsieh believes
when employees will be more engaged with their work and customers which leads to
innovation. Zappos incorporates this culture in their employees starting from the hiring
process. After the training program, Zappos offers new hires $2,000 to quit after they
have been newly hired to weed out employees that do not fit their culture (McFarland).
Zappos will let go anyone who doesn’t fit their core values.
Zappos pays their call center representatives less than the national average for that
position but still maintain their employee satisfaction to a higher level due to the added
value to the job that cannot be accounted for on a paycheck. There is a wide range of
additional benefits Zappos offers in addition to health care plans such as life insurance,
fitness benefits, lifestyle programs, paid volunteer time, discounts with partner
corporations, and so much more. ("Employee Benefits | about.zappos.com").
Hsiesh believes that one of the most important ways to increase efficiency is by
improving communication and building relationships with your coworkers. This strategy
is in line with their “Build a positive team and family spirit” core value. Zappos makes
time for employee activities that are fun and team building exercises such as hiking trips,
movie outings, and hanging out at the bars after work. Even though the work
environment seems like all fun and games, everyone is still expected to work hard and
efficiently. Zappos provides strong core values and integrates specific values into their
company while satisfying their employees. I would give Zappos an A for building such a
strong connection throughout the entire company from top to bottom.
Customers: A+
Zappos is known for their easy and accurate service. They help customers make
well informed choices and provide consumers with generous and simple return
procedures. Zappos’ customer service makes an effort to solve 80% of their customer
calls within 20 seconds which is great for a company that does not script or regulate their
call times (Berthiaume). Employees are free to talk to customers how they choose and are
encouraged to “wow” them. Customer service representatives are expected to build
relationships with customers as well. For example, there are several cases when Zappos
employees have sent flowers to customers on their birthdays, or even sent pizzas to
customers who tweeted to the company that they were just hungry (Gallo). Great shopper
experiences builds customer loyalty and that word of mouth marketing is the best way to
reach new customers. Based on their emphasis on the customer experience, Zappos
deserves an A+ for going above and beyond the customers needs. Zappos knows when
you help you customers get their needs met easily, assist them to buy what they want, and
deliver those items reliably, customers are not only satisfied, but loyal as well.
Community: A
Despite making efforts to improve employee and customer satisfaction, Zappos
dedicates as much focus towards a variety of philanthropic activities as well. These
programs include elementary schools, LIVESTRONG partnerships, Shade Tree, and the
Nevada childhood Cancer Foundation (Zappos.com). Zappos also started their own
campaign called LEAF, Leading Environmental Awareness for the Future, that focuses
on environmental efforts such as reducing its carbon footprint, recycling programs,
community gardens, and raising awareness to be more eco-friendly and sustainable
(Zappos LEAF). The Zappos company blog includes a section to highlight their available
eco-friendly products that customers might be interested in. The blog also includes
suggestions that consumers can reduce their carbon footprint and live more
environmentally friendly (Eco-friendly). While being a powerhouse online retailer,
Zappos manages to be environmentally friendly at the same time which is more than what
could be said about most retailers that size. I would grade Zappos sustainability an A for
how philanthropic and environmentally aware the company is. The fact that Zappos also
encourages its customers to live a more sustainable lifestyle can be seen as ethical as well
to raise overall awareness.
Stockholders: B
Zappos was sold to Amazon in 2009 and became their sole stockholder. The
Zappos shareholders would trade their stock for Amazon stock and most shareholders
were not happy about this acquisition. Tony Hsieh addressed customer concerns by
issuing a statement why he sold to Amazon. He discussed the disagreements between
Zappos and their previous partner, Sequoia Capital, due to management and conflicting
core value differences. Sequoia wanted to focus less on employee satisfaction and more
on profits which was the complete opposite of what Zappos was built on. Hsieh wanted to
buy out the board members but could not do so without the help of Amazon. Amazon
CEO, Jeff Bezos, convinced Hsieh that Zappos could operate independently even after a
full acquisition and continue to build their own company culture (Wauters). The
transparency of Zappos informs their consumers and shareholders of all major decisions
with detailed information. This relates to their belief that the company should develop
honest and open relationships with the stakeholders to build company reputation and
trust. Although Zappos does not have any direct shareholders, Zappos made the best
decision in the interest of their stakeholders regarding the merger with Amazon rather
than Sequoia Capital which is why I would grade Zappos a B.
Reflection
Researching on the Zappos corporate culture and stakeholder audit gave me an
example of what I should look for in a company to work for. Salary is not the most
important thing in the world. I should enjoy working for the company that I am doing so
and have positive relationships with the people that I work with. Zappos demonstrates the
idea of working in a friendly environment that leads to stronger efficiency and customer
satisfaction. Zappos has been recognized for its innovative business practices and the
company continues to be known for its focus in maintaining a business model that
encourages transparency and strong relationships with all stakeholders. Zappos knows
how to treat all of their stakeholders without the risk of losing out on profitability and
financial status. Something that most corporations can learn from Zappos is to create a
trustworthy and ethical business environment that will resonate with employees and
customers.
References
Berthiaume, D. (2014, November 13). TechBytes: Five Cool Ways Zappos Ensures
Disruption and Innovation. Retrieved November 13, 2014, from
http://www.chainstoreage.com/article/techbytes-five-cool-ways-zappos-ensuresdisruption-and-innovation
Eco-friendly | blogs.zappos.com. (2013, January 30). Retrieved November 15, 2014, from
http://blogs.zappos.com/taxonomy/term/4556
Employee Benefits | about.zappos.com. (n.d.). Retrieved November 14, 2014, from
http://about.zappos.com/jobs/why-work-zappos/our-benefits
Gallo, C. (2009, May 12). Delivering Happiness the Zappos Way. Retrieved November 14,
2014, from
http://www.businessweek.com/smallbiz/content/may2009/sb20090512_831040.htm
McFarland, K. (2008, September 16). Why Zappos Offers New Hires $2,000 to Quit.
Retrieved November 14, 2014, from http://www.businessweek.com/stories/2008-0916/why-zappos-offers-new-hires-2-000-to-quitbusinessweek-business-news-stockmarket-and-financial-advice
Wauters, R. (2010, June 7). Tony Hsieh Explains Why He Sold Zappos To Amazon Under
Pressure From Sequoia. Retrieved November 15, 2014, from
http://techcrunch.com/2010/06/07/tony-hsieh-zappos/
Zappos.com Powered by Service. (n.d.). Retrieved November 15, 2014, from
http://about.zappos.com/our-unique-culture/zappos-community-involvement
Zappos L.E.A.F. team | blogs.zappos.com. (2012, December 5). Retrieved November 15,
2014, from http://blogs.zappos.com/taxonomy/term/26458