Why Offering Quit Bonuses Can Help Create Sticky Products and Memorable Companies

Why Offering Quit Bonuses Can Help Create Sticky Products and Memorable Companies

In the world of business, companies are constantly looking for ways to retain customers and create a memorable experience. Two companies that have successfully achieved this are Zappos and Facebook. Zappos, an online shoe and clothing retailer, has a unique approach to employee retention. CEO Tony Hsieh and his colleagues offer new employees a quit-now bonus, starting at $100 and potentially going up to $1,000 as the company grows. This may seem counterintuitive, but Zappos believes that if a new hire is willing to take the money and run, they lack the commitment the company is looking for.

On the other hand, Facebook, the social media giant, has mastered the art of creating a sticky product. Sticky products are those that users find difficult to leave because of the accruing benefits and mounting loss associated with them. Accruing benefits refer to the idea that the more a user engages with a product, the better it gets. Facebook achieves this by leveraging the data users create while using the platform to enhance their experience. Implicit and explicit actions are combined to create a strong accruing benefit. Mounting loss, on the other hand, occurs when a product becomes ingrained in a user's identity or when they have accrued value from using it. Users feel they have a lot to lose if they were to leave the product.

So, what do these two seemingly unrelated concepts have in common? The answer lies in the underlying principles that drive them. Both Zappos and Facebook understand the importance of emotional engagement with their customers. They recognize that companies don't engage emotionally with customers; people do. To create a memorable company or a sticky product, it is essential to fill the organization with memorable people.

Zappos achieves this by screening new hires for commitment and offering them the opportunity to self-select out if they don't feel a sense of commitment to the company. By doing so, they ensure that their workforce is filled with individuals who truly believe in the company's mission and values. This commitment translates into better customer service and a more memorable experience for their customers.

Similarly, Facebook understands that creating a sticky product requires more than just a great user interface. It requires understanding the underlying motivations and emotions of its users. By leveraging user data and creating a product that becomes part of their identity, Facebook makes it difficult for users to leave. The sense of belonging and the fear of losing connections and investments made on the platform keep users engaged.

So, what can other companies learn from these examples? Here are three actionable pieces of advice:

1. Prioritize emotional engagement: Companies should focus on creating an emotional connection with their customers. This can be achieved by hiring employees who are passionate about the company's mission and values. When customers feel a genuine connection to the people behind a brand, they are more likely to have a memorable experience and become loyal advocates.

2. Leverage user data: Understanding user behavior and preferences is crucial in creating a sticky product. By analyzing data, companies can tailor the user experience to meet their customers' needs and desires. This can include personalization, targeted recommendations, and features that make the product more valuable the more it is used.

3. Create a sense of identity and community: Building a product or company that becomes part of a user's identity is a powerful way to create stickiness. By fostering a sense of community and allowing users to build connections, companies can make it difficult for users to leave. This can be achieved through features like user profiles, social sharing, and user-generated content.

In conclusion, the examples of Zappos and Facebook demonstrate the power of emotional engagement and creating sticky products. By prioritizing commitment in their workforce and leveraging user data, these companies have been able to create memorable experiences for their customers. Other companies can learn from these examples by focusing on emotional engagement, leveraging data, and creating a sense of identity and community. By doing so, they can create products and companies that are difficult to leave and that leave a lasting impression on their customers.