Visitors leave the ' experience ' Heineken - minded. It has become an effective marketing experience. Experiences have a high value for consumers and the demand for experiences is increasing. Consumers are therefore willing to pay a high price for Recognizing experiences as a distinct economic offering provides the key to future economic growth , as shown in Chapter Sundbo, and what we witness with the contemporary focus on the experience economy is the The result provides an indication of what kind of growth the experience economy provides.
To do so, the article is organized as follows. The next section moves beyond conceptualization and makes an They herald the still emerging Experience Economy. Why now? Part of the answer lies with technology, which powers many experiences , and part with increasing competitive These factors importantly include, Download Free PDF. Welcome to the Experience Economy. Karen Montalva. A short summary of this paper. Download Download PDF.
Translate PDF. Welcome to the Experience Economy by B. Sobek ii, idea s at work Jeffrey k. Gil more ow do economies change? The make the birthday cake nor even throw the H entire history of economic progress can be recapitulated in the four- stage evolution of the birthday cake. As a party.
Welcome eggs that together cost mere dimes. As the to the emerging experience economy. Later, when the are a distinct economic offering, as different service economy took hold, busy parents from services as services are from goods.
Now, questionably desire experiences, and more in the time-starved s, parents neither and more businesses are responding by ex- plicitly designing and promoting them. Gilmore are services, like goods before them, increas- cofounders of Strategic Horizons LLP, based in ingly become commoditized — think of Cleveland, Ohio. All rights reserved.
An early look at the characteristics of experiences and Differentiated Stage the design principles of pioneering experience experiences stagers suggests how companies can begin to an- swer this question. Deliver services Competitive Position Staging Experiences that Sell To appreciate the difference between services and Make goods experiences, recall the episode of the old television show Taxi in which Iggy, a usually atrocious but fun-loving cab driver, decided to become the best Extract taxi driver in the world.
He served sandwiches and commodities Undifferentiated drinks, conducted tours of the city, and even sang Market Premium Frank Sinatra tunes. By engaging passengers in a Pricing way that turned an ordinary cab ride into a memo- rable event, Iggy created something else entirely — a distinct economic offering.
The experience of that the next competitive battleground lies in stag- riding in his cab was more valuable to his customers ing experiences.
By asking to go modity. To realize the The service Iggy provided — taxi transportation — full benefit of staging experiences, however, busi- was simply the stage for the experience that he was nesses must deliberately design engaging experi- really selling.
This transition from An experience occurs when a company intention- selling services to selling experiences will be no ally uses services as the stage, and goods as props, to easier for established companies to undertake and engage individual customers in a way that creates weather than the last great economic shift, from a memorable event.
Commodities are fungible, the industrial to the service economy. Unless com- goods tangible, services intangible, and experiences panies want to be in a commoditized business, memorable. Companies consist of people, and busi- physical, intellectual, or even spiritual level. Thus, ness-to-business settings also present stages for no two people can have the same experience, be- experiences. For example, a Minneapolis computer- cause each experience derives from the interaction installation and repair company calls itself the between the staged event like a theatrical play and Geek Squad.
But today the concept of selling an enter- like the St. Louis-based trainers One World Music, tainment experience is taking root in businesses far facilitators of a program called Synergy through removed from theaters and amuse- ment parks.
New technologies, in par- ticular, encourage whole new genres of experience, such as interactive Today the concept of selling games, Internet chat rooms and multi- player games, motion-based simula- experiences is spreading beyond tors, and virtual reality.
The growing processing power required to render theaters and theme parks. Our which to sell their goods and services. In June , business is the delivery of information and lifelike Silicon Graphics, for example, opened its Visionar- interactive experiences.
Customers can view, hear, and Recreational Equipment Incorporated draw and touch — as well as drive, walk, or fly — through consumers in by offering fun activities, fascinating myriad product possibilities. Companies generally move at the lowest possible price. But eventually IBM had of the movie just to go into the theater. Soon, perhaps, with 65, square feet of restaurants and stores being Companies should think about added to the complex, Star will charge its customers admission just to get what they would do differently into the complex.
Some retailers already border on the if they charged admission. At the Sharper Image or Brookstone, notice how many people play with the gadgets, listen to minia- software. Could these stores charge charging for them. Services, it turned out, were the admission? Not as they are currently managed. The merchandise mix would need to annual rates. The company no longer gives away its change more often — daily or even hourly.
The stores services to sell its goods. To avoid alienating its exist- services. If that is the goods they provide. Would people pay? People automakers are cases in point. An admission fee omy that most companies providing experiences — would force Nike to stage more engaging events like the Hard Rock Cafe, the Geek Squad, or Silicon inside.
Afterward customers could buy customized offering unless it actually charges guests an admis- Nike T-shirts, commemorating the date and score sion fee. An event created just to increase customer of events — complete with an action photo of the preference for the commoditized goods or services winning hoop. There might be more interactive that a company actually sells is not an economic kiosks for educational exploration of past athletic offering.
But even if a company rejects for now events. Nike agers should already be asking themselves what could probably generate as much admission-based they would do differently if they were to charge ad- revenue per square foot from Niketown as the Walt mission.
The answers will help them see how their Disney Company does from its entertainment company might begin to move forward into the ex- venues — and as Disney should but does not yield perience economy, for such an approach demands from its own retail stores. For the premier company the design of richer experiences. Current and elsewhere. Excellent design, marketing, and delivery for the experience — does not mean that companies will be every bit as crucial for experiences as they have to stop selling goods and services.
Disney gen- are for goods and services. Ingenuity and innovation erates significant profits from parking, food, and will always precede growth in revenue. Yet experi- other service fees at its theme parks as well as from ences, like goods and services, have their own dis- the sale of memorabilia. The first corresponds to customer par- characters to exploit.
Such participants include sym- admission before they let a consumer even set foot phony-goers, for example, who experience the in them. Some shopping malls, in fact, already do event as observers or listeners. At the other end of charge admission. These shopping is still free. But even people who Garlic Festival in California, the Minnesota Renaissance Festival, the Kitchener-Waterloo Oktoberfest in Ontario, Canada, and other sea- Some companies will eventually sonal festivals that are really outdoor shopping malls and do indeed charge be like trade shows, charging admission.
Consumers judge them worth the fees because the festival op- customers to sell to them. With nearly every customer leaving tribute to the visual and aural event that others with at least one bag of merchandise, these festival experience.
At one end of the connection spectrum lies trade show — a place for finding, learning about, and, absorption, at the other end, immersion. Furiously scribbling bilities that aspiring experience merchants will notes while listening to a physics lecture is more need to master.
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