Happiness: The secret to a successful business and loyal customers?

Online shoe retailer Zappos has become synonymous with great service in the 12 years since it was founded. The fact that it generates 75% of its business through repeat purchases has entered modern business folklore and its “customer obsession” so impressed Amazon CEO that he decided to buy the company.

 

In fact, the Zappos story has become so inspirational that when co-founder Tony Hsieh shared the lessons he learned from business in his first book, Delivering Happiness, A Path to Profits, Passion, and Purpose, it shot to the top of bestseller lists around the world. Furthermore, spurred on by the success of the book, Hsieh and Zappos collaborator and consultant Jenn Lim were motivated to grow the book into a new firm to help people and organisations apply the frameworks that had made Zappos a success to their own businesses and lives.

 

Referred to not just as a business, but also as a ‘movement’, Delivering Happiness spreads the gospel of happiness through a community online (DeliveringHappiness.com, Facebook and Twitter) and in the real world at events. It also has a team called DH@work to coach how the Zappos frameworks can be applied in any workplace.

 

“Even though most people associate Zappos with its customer service, it’s actually not its number one priority,” explains Lim, who is CEO and chief happiness officer at Delivering Happiness. “The highest focus is actually on company culture, which leads to a separate reason why I think customers are so loyal.

 

“In books like ‘Good to Great’ by Jim Collins, studies show that the most sustainable brands are led by two things: by having a strong company culture and a higher purpose by which employees are inspired. We really believe that brand is a lagging indicator of culture, and that if we get the culture right, things like growth and great customer service will happen naturally.”

 

 

Company culture has long been hailed as the foundation of Zappos’ success and Lim was responsible for creating the first Culture Book for Zappos in 2005, boasting the firm’s core values. Now on its seventh edition, the book continues to inspire its employees and beyond, with the tome available to anybody who requests a copy from tony@deliveringhappiness.

 

“I think people have a stronger connection to companies that know the ‘why’ of what they’re doing (still important is the ‘what’ and the ‘how’, but a few degrees less so),” says Lim. “Given the accessibility of information, having a reason to spend time/money with someone/a company gets more and more important. Apple is the timeworn example (Think Different.), Method soap is another (reinventing the soap industry to the point it makes people feel good cleaning their hardwood floors). Since Zappos is transparent with its number one priority being company culture, and its higher purpose in delivering happiness to the world…  it makes it easier for people to decide who they want to be around.”

 

Amongst the core values in the book are ‘embrace and drive change’, ‘create fun and a little weirdness’ and ‘be humble’.

 

“One of Zappos’ core values is to ‘Deliver WOW through service’. Simply put, the goal is to exceed expectations so you can elicit a WOW out of people,” continues Lim. “What I think is especially interesting is that ‘service’ – be it to a customer, partner, vendor, friend and/or co-worker - can always be extended to WOW anyone in the world, especially since everyone in our lives can be considered a customer.”

 

This, Lim says, reflects the importance that the company places on personal emotional connection.

 

“Whenever I think about Zappos, this Maya Angelou quote comes first to mind: ‘People will forget what you said, people will forget what you did, but people will never forget how you made them feel.’  While Zappos knows what it takes to succeed as a business (e.g. revenues, profitability, margins), it also knows it’s not the way to build a long-term sustainable brand. Instead, Zappos considers something else more important – the personal emotional connection – that employees can establish with customers.”

 

 

And the message that Delivering Happiness is taking to the world is that any business can follow in the footsteps of Zappos by embracing the same principles – a message that is being embraced, even though Lim admits that in the past many have been dismissive, suggesting that “That’s great for Zappos but it would never work at my company...”

 

“We actually get that response a lot! Going back to books like Good to Great and Tribal Leadership, we’re not the only ones that believe in what we’re doing. What’s exciting is that more people – whether academic, business or scientific – are drawing the same conclusions,” she says. “There’s a book The Happiness Advantage by Shawn Achor that shares a study done on KPMG in 2008 that assessed employee’s level of happiness before and after tax season. And if anyone remembers the markets in 2008, this was probably the best time to conduct this kind of study.)

 

“One test group was given lessons on positive psychology and the science of happiness. The other went on its regular way of doing business. When people were asked how they fared before, during and after tax season – the test group exposed to positive psychology tested higher in all realms (e.g. perceived stress, perceived effectiveness, social support and work optimism) not just created a higher ROI in the short-term, but in the longer term as well.

 

“For us, what’s most compelling is that we hear from companies every day – big or small, around the world – letting us know how they’ve managed to increase things like productivity and revenues in a similar way, but only as a by-product of focusing on company culture and customer service. This is one of the reasons why Tony and I decided to take Delivering Happiness from a book to a company. Given all we’ve heard and experienced so far, we believe there are ways to continue nudging companies and communities (thus the world) to a happier place.”

 

Lim concludes: “More than ever before, information is readily available to anyone that wants to access it. Since Zappos is so transparent with its beliefs in treating employees right and having a higher purpose (delivering happiness to the world), customers that catch wind of that usually want to keep Zappos in their lives. An interesting example of this – Zappos has fans all over the world (e.g. Brazil and Japan), even though it doesn’t ship outside of the US. If there’s an emotional connection and shared higher purpose, it doesn’t matter what you’re doing business in, it just matters that you’re aligned with people that share the same values.”

 

 

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