Why Customers Are the Focus: Book Review of Delivering Happiness

Delivering Happiness: A Path to Profits, Passion, and Purpose by Tony Hsieth (Business Plus, 2010)

Delivering Happiness will make you happy and it will probably make you better at business—if you’re willing to take the necessary risks.

Tony Hsieth (pronounced Shay) sold his first major startup LinkExchange to Microsoft for $265 million. He was only 24. This left Tony with the question, “What next?” He started a small venture capital firm, which led him to the founders of Zappos. After a time of simply being an advisor and investor, he went “all in” as Zappos’ CEO—and for Tony, that meant “all in,” because Zappos’ survival would eventually mean selling nearly everything he owned and dumping all of his money into the company. Zappos now does over $1 billion in gross merchandise sales annually and is owned by Amazon (Amazon exchanged shares for the purchase, at a deal valued at over $1.2 billion).

I have had a long-time obsession with Zappos. It started when I was convinced to buy a pair of shoes because of a short video on a product page (why did something so simple work so well?). My love for Zappos grew when it was super easy to return a pair of shoes. And then when my customer inquiry was answered at 11pm PST, I became jealous of their level of service. Zappos makes you want to deliver better service. They’re inspiring.

Tony takes huge risks and you can’t help but love that about him. I talk about Tony like I know him because Delivering Happiness makes you feel like you do. Tony left LinkExchange with about half of what he could have earned from the sale of LinkExchange, because he wanted to do things he was passionate about (pgs. 48–54). Microsoft would have given Tony close to $40 million, but by resigning within 12 months of the sale, he only received about half that. It all sounds crazy, but there’s a part of you that has to respect the decision. Why stay at a place you have grown to hate? Tony had grown to hate the culture he accidently created and wanted to do something that mattered.

Tony bets in business like he is playing a poker game, which (as Tony explains) is less about the odds than you may think and more about understanding how the game works and picking the right table (pgs. 62–68). When Tony left LinkExchange, he was picking a different table to sit at.

I love the way Delivering Happiness teaches you to solve problems: Tony walks through the real strategy discussions in their history—showing you their successes and failures. The two biggest game changers for Zappos: expanding their product offerings and focusing on improving the customer experience (pgs. 100, 137). (They expanded product offerings by issuing better terms to vendors and buying physical retail stores that had existing relationships.) When I read about these two decisions I began to wonder: If all businesses did this, would their revenue go up? How much cost do you have to incur to make a change like that happen?

The changes in Zappos’ logistics are also fascinating. They started by not carrying any inventory and having vendors ship for them. They then moved to carrying some inventory, but not everything. When it turned out Zappos couldn’t deliver the type of customer service they wanted, because vendors regularly couldn’t fulfill their orders, they decided to move to having all inventory on hand. But the costs were astronomical, so they temporarily outsourced shipping products. That turned out to be a terrible decision not just because of the partner they chose, but also because they had decided to go for short-term gain at the cost of long-term customer relationships. They had also outsourced a core competency—shipping is part of the customer service process. Tony decided to never again outsource a core competency.

Throughout Delivering Happiness, there are knock-out boxes with tips like “Top 10 Questions to Ask When Looking for Investors and Board Members” (e.g., pgs. 210–211). This hands-on practical advice is wonderful. This advice is coupled with real company emails—these are usually from Tony, but there are also thoughts from other Zappos employees.

But there are some things about Delivering Happiness that don’t seem to fit with the rest of the book. Tony seems to loves clubs and so there are far too many scenes set at those locations; it gets a little awkward at times (pg. 226). That’s his lifestyle and I respect the transparency, but that coupled with a whole chapter on happiness psychology shows me how different my worldview is from Tony’s (pgs. 228–244).  All that to say that this review isn’t an endorsement, but I am still very grateful for this book. 4 stars.

 

(I read this book as part of Logos Bible Software’s “Read for Cash” program. The author and/or publisher in no way influenced my review. However, the links above are affiliate links, which means I will receive a very small amount if you click them and then make a purchase.)

Wow. It's Quiet Here...

Be the first to start the conversation!

Leave a Reply:

Gravatar Image

XHTML: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>