Office Hack #27 — Zappos’ money hack
Envoy is all about making things easier and more fun in the office. In that spirit, we are proud to bring you our new Envoy Office Hacks podcast series. Every week, we deliver the coolest, most ingenious, and just plain fun fixes people have invented to improve efficiency and productivity in their workplace.
If you only had a dollar for every time someone thought you were kicking butt at your job…
Actually, if you worked at Zappos, that’s exactly what you’d get. At Zappos, it’s not only managers giving props for a job well done. In fact, most recognition comes from peers.
About 10 years ago, Zappos was faced with a problem. Vendors kept giving them free stuff. Not a bad problem to have, right? But the challenge came in trying to determine how to fairly share these perks with staff.
Enter the hack: the “Zollar” is born.
The appearance of the bills have changed over the years. Above is what Zollars used to look like (now coveted by nostalgic staffers). Below are the the Zollar bills of today.
Zollars can be earned by doing good work, and having that good work recognized by peers.
“I would say most things that we do here are employee-driven. They’re not top-down initiatives.” Regina Renda, Manager of Zollar Store (among other things)
Each Zollar must be addressed to a specific person, along with a written reason why they’re receiving it, and a signature of the giver.
Due to the majority of denominations being $10 or lower, the act of signing each bill generally prohibits gobs of Zollars being given out at one time or to one person.
Peers recognizing peers. That’s how this economy works.
“I think one of the great outcomes that come from the Zollar Store program are the relationships that it helps employees build… It’s showing that people are paying attention to what others are doing. It really does show that another employee really does care about another employee.” Steven Bautista, P.E.A.C.E. Promoter, Zappos
And you can take all the “peer appreciation” you’ve earned straight to the Zollar store.
Here you can buy anything from t-shirts to water bottles to balloons, phone accessories and pet supplies.
But that’s not all.
Zappos, being a Las Vegas based company, also offers ways to gamble your Zollars… for bigger prizes.
“Just like on the strip, the house always wins. So it’s one of those situations where we’ll implement ones that have higher odds that are probably not in their favor, but the prize is greater if they win. It entices them to spend more of their Zollars on stuff that really doesn’t cost us anything at the end of the day.” Steven Bautista, P.E.A.C.E. Promoter, Zappos
Items in the Zollars store are refreshed every quarter. At any given time, there are between 50–60 different products available.
Of the 1,500 people that work for Zappos, about 600–700 are actively engaged in the Zollars economy. And with so many people engaged, and so much currency on the market, inflation is inevitable. Except at Zappos, it’s called Zinflation.
“Zinflation is pretty much our form on inflation. If we see Zinflation happening we’ll pull the higher dollar amounts, like the 10’s, the 5’s, or the 20’s off the market so people can only give 1’s or 2’s. You’re less likely to go ahead and give a ton of them because you have to sign the back of [each one]. …it really does help control people’s ability to start handing out stacks of them like it’s raining money. That’s Zinflation.” Steven Bautista, P.E.A.C.E. Promoter, Zappos
But it’s not all about gambling and ways to beat inflation, a huge part of the Zollars economy focuses on charity and promotes and rewards volunteer work. In fact, the charity portion of this office hack has grown so much, there’s a whole other reward-and-redeem model based on employees who routinely are “giving back”. Instead of Zollars, employees earn Karma coins to spend in the Karma Store.
“We took the Zollar store model and started to put it on different things we wanted employees to get engaged in. So [Karma coins for doing charity work or volunteering] became something that they start to collect and earn. Then they can redeem them for different products that you can’t get in the Zollar store, you can actually [only] get at the Karma store.” Steven Bautista, P.E.A.C.E. Promoter, Zappos
How to hack it
If you want to create an internal rewards economy within your workplace, Zappos has some tips, in the form of Q & A.
Q: How does one start an economy like yours? For example, do you start by giving every employee 5 “dollars” to stimulate activity? A: At Zappos, each employee goes through New Hire Training. It is at that time, Zollars are first introduced and where a bulk of Zollars are earned for participation. Each employee can also ask for a small bank of their own to hand out to other employees.
Q: Where do you get the money printed and is there anything special to know about it? A: We have designed each Zollar bill internally and we use a local printer to print, cut and sort each denomination.
Q: With how much stock should one start? A: We suggest starting with 10–15 items you know your staff will enjoy as a prize, something useful, or unique. Don’t buy too much of one product. Always buy the minimum. At Zappos, we try to not bring the same items back in stock year after year. It keeps our Zollar Store fresh and exciting with new emerging product.
Q: Any advice on how to price stuff? A: Pricing can be tricky since there is no value to Zollars. In reality, the branded merchandise is intended to be given away. Often times, the question we ask when pricing is how much did we pay for this? And how long should an employee have to save their Zollars to earn this product? If the item cost Zappos two bucks, employees shouldn’t have to save for very long. However, if the item cost Zappos 50 bucks, employees should have to work harder and save longer to earn that item.
Q: Signals to watch for when it’s time for inflation? A: At Zappos, Zinflation happens when we have more Zollars going out of the ecosystem than coming into the ecosystem. We track this by our metrics using order forms.
Listen & Subscribe
You can listen to the full story in the Envoy Office Hacks podcast. Please subscribe to the podcast in iTunes — just click here and hit ‘subscribe’.
- Introducing two new, faster ways to sign in
- Your sign-in, now in 17 languages
- How we made Envoy better in 2018