Next-Gen 2, Economy of Experiences
“It’s no longer sufficient to create a product, a service, an experience, or a lifestyle that’s merely functional.
Today it’s economically crucial and personally rewarding to create something that is also beautiful, whimsical, or emotionally engaging.”
Every event that happens in the world leaves some kind of echo on us. Experience is nothing more than the subjective impression of that event. I will experience the same set of events very differently than my kid because our contexts are very different, which tells us how intrinsically personal the experiences are. They are also unique. Every additional time an event happens even in the same setting, the experience can be very different. In that sense, we as customers will value them more, when positive, than things that are repeatable and have been the markers of previous economies.
In terms of focus on value creation, we've gone from commodities economy to product economy, to service economy and now to experience economy. Of course, we still deal with commodities, and products, and services, but the further back you go, less economic value can be extracted from the offering. This explains why the tickets for high-end sport or music events can be sold in tens of thousands of dollars, and high-end most sophisticated electronic devices have fallen in price from thousands to hundreds of dollars.
An experience does not necessarily need to be in the physical world. We often talk about the awesome user experience we had with our new phone or newly installed app or web service. However, COVID has caused extended absence from the physical world, which is a signal to us how critical to our wellbeing it is. Especially in the physical world in which we are surrounded by other people, conversations, natural or man-made environments, sounds, aromas, tastes and how each one of these factors is deeply interconnecting with others to produce our very own experience.
Clever brands when they talk about brand experience really understand that they need to create a network of touchpoints with their customers driven by very unique and cleverly defined brand story and brand promise. The strongest touchpoints that leave the deepest impressions are in the physical environments, where the brand can control most of the above-mentioned factors. Other touchpoints will try not to mimic, but echo that core story, like in the online presence, social media, advertisement, community involvement, etc. Think about NIKE with their concept stores, Disney with never waning interest in theme parks, Starbucks that has almost become a synonym for coffee shops, national parks with their spectacular environments, or your favourite local restaurant. All of these might also choose to have a presence on Facebook, their own websites, apps, billboard ads, or sponsoring local sports teams.
“Restaurant is the stage
Staff is the cast
Brand is the show
•
Guest is the creator!”
These brands have learned that what they can not do is to produce experiences, but what they can do is to set a stage in which experiences will occur. The stage is a term that in the restaurant context would cover the store design, furniture, food and beverages, lighting, aromas, music, other guests, servers, other activities, sense of belonging to a neighbourhood or town (all parts of front of house), but also all the supporting, not directly visible systems, like chefs and kitchen operations, cleaning staff, managers, and the technological tools that connect many of those factors (parts of the back of house). Not many Disneyworld visitors know that underneath their feet is an elaborate system of utilidors, underground corridors for supporting functions, that all the Disney attractions deeply rely on to deliver great experiences. Furthermore, brands will continue relationships with their customers via their online presence, apps, social media channels, local gym, specialty magazines, etc. Wherever the customer is, whether physical or virtual and whenever the context is right, a successful brand will have corresponding touchpoints.
When prepping the stage, what often can help brands is depicting the full customer journey. The customer journey map is a visual schematic in which the customer persona can be formalized and the touchpoints can be identified, the state they're in assessed, and addressed in terms of deploying tools and tactics for their improvements. Of course, this is not a one-time action but needs to become a continuous loop, where the adjustments are made on an ongoing basis. This approach spotlights the importance of two kinds of data that businesses need, standard operational data coming from eg. POS (WHAT has happened), as well as experience data that would need to be collected from guests at the most meaningful time (WHY it has happened). A good illustration of this model comes from 75% of Fortune 100 companies that rely heavily on Qualtrics XM systems to collect experiential data. Systems like these might be overkill for some of the restaurant operations since they think they get the word of mouth feedback. However, the feedback not collected and acted upon at the right time leads to reviews posted on all kinds of online services and social media that can be much harder to control.
This leads us to the next important area to consider, Understanding People.
