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COVER STORY Tony Hsieh might even be the key to Southern Nevada's dream of business diversification. Having made large profits in a town struggling to recover from the Great Recession, it's clear this smart dude is onto something. Something big. THE CRITERIA When VEGAS INC decided to pursue its first ever The Smartest Dude In Town special issue, we knew it would be controversial. How could it not be? The inherent drama notwithstanding, we hope this becomes an annual event every Labor Day, where we take stock of where the business community stands and who best exemplifies all that is good and effective and important about Las Vegas business. VEGAS INC used several metrics when reaching the decision. First, we asked: Is the person successful in Las Vegas, and perceived to be successful by his or her peers? Is this business leader doing something truly innovative with his or her business? The nominee also had to exhibit marketing savvy with global reach—influence and recognition beyond Las Vegas. In simpler terms: If VEGAS INC had to select one individual to place in a time capsule that best represents the pinnacle of Las Vegas business in 2011, who would that person be? Aſter many months of long, spirited discussions, VEGAS INC tapped Tony Hsieh, CEO of Zappos.com, as our selection this year. Steve Wynn will be VEGAS INC's first inductee into The Smartest Dude In Town Hall Of Fame for exemplifying our criteria throughout the course of his long, decorated career in Las Vegas. With Wynn's selection, we expect no such controversy to ensue (but you never know). —The Editors T 22 here's really no doubt that Tony Hsieh, ubiquitous in the national media these days, is one incredibly smart dude. His relatively nascent business, Zappos.com, had gross sales in excess of $1 billion last year. If diversification in business is the key to Las Vegas' future, nongaming and nontourism executives such as 37-year-old Hsieh (pronounced SHAY) will clearly be the ones to lead the way. Luckily, in Hsieh, a guy who's reported net worth is upwards of $400 million, we've got someone who's excited to be up to the task. Report, to talk about his company's expansion from shoes into clothing and other items. As always, host Stephen Colbert cuts to the chase at the start of the Last month, Tony Hsieh appeared on Comedy Central's megahit, The Colbert interview: "How do you sell happiness?" Colbert asks in his signature mocking tone, referring to Hsieh's book, Delivering Happiness. "I've been told money can't buy happiness. I've long suspected that was a lie." The audience laughs. "You're telling me I'm right?" Hsieh, clad in his signature jeans and button-down shirt, is ready for Colbert's faux-onslaught. Hsieh says, simply, that happiness is his company's business model. Happiness for employees, customers, everybody really, begets productivity, satisfaction and increased sales. Customer service has long been key to Las Vegas' success—think casino and hotel rewards programs—and Hsieh takes the concept to a whole new level. Consumer loyalty isn't just important to Zappos.com—it's everything. And you don't have to be a card-carrying member to benefit from it, or as Hsieh would say, to get "WOW" in every shoe or clothing box. But, come on, how do you deliver WOW, exactly? Colbert demands to know. Hsieh explains that loyal, return customers who buy from Zappos.com sometimes get a surprise upgrade to overnight shipping—a simple, but very delightful surprise for shoe lovers. "A lot of people order as late as midnight Eastern, and the shoes show up on their doorstep eight hours later," Hsieh says. The audience goes wild. "Wow!" Colbert says, peering over his glasses. "Exactly," Hsieh says, smiling. Happiness is our business model. Has a nice ring to it, no? And in a city founded on creative ways of making fun, happy experiences for core customers—tourists—that model seems to be a perfect fit. Hsieh might even be the key to Southern Nevada's dream of business diversification. Having made large profits in a town struggling to recover from the Great Recession, it's clear this smart dude is onto something. Something big. | 5 SEPTEMBER 2011 |