Even at Walt Disney World and all the other Disney theme parks places with a high degree of producer- staging and, we should point out, tens of millions of enthralled guests every year guests themselves exert a great. Its a new society in which businesses, communities, and people as individuals will thrive on the basis of their stories, not just on data and information (Jensen, 1999,. It is today very difficult to invent and therefore rare to encounter a truly new good; most differentiation of goods now involves the enhancement or modification of items within existing product categories and not the creation of wholly new categories. He pointed out how economists make some classic distinctions to differentiate the two: goods are standardized while services are customized done on behalf of an individual customer; goods are inventoried after pro- duction while services are delivered. People who buy memberships in a fitness center do not pay for the pain but for ongoing exercise regimens that will increase their physical well- being, helping them go from flabby to fit.
The final insight to achieving success via the state- of- the- art in experience staging that we have discussed in this chapter is recognizing that charging admission is the economic key. C- t/featuredetails/ 114/schrager- s- new- design- for- living (accessed ). Eventually, they must align what they charge for with what their customers value, and that means charging for time. For more and more people are bringing their technological devices iPods, iPhones, iPads and so on with them wherever they go, with the diverting of their time, attention and money always just a glance away, a warm glowing trance away from remaining in the experience. (This effect does not occur for true commodities, which, being fungible, cannot be materially changed, much less customized.) Where commoditi- zation drags down offerings (and the companies that offer them) year after year like the force of gravity, customization enables. The Internet is the greatest force of commoditization ever invented, and while it initially attacked the price of goods it is now commoditizing such services as hotels, airlines, banks, telecom- munications and brokers of all stripes. should focus on the actual educational, personal and societal outcomes achieved, collecting all or part of the tuition only when those out- comes become clear at graduation and beyond. Similarly, the reward systems in financial institutions would reflect the true results of investment decisions and then move away from an exclusive spotlight on investments to granting wise counsel on life decisions concerning how best to spend and gift wealth. Whenever workers perform in front of the watching eyes of customers, they are acting whether they know it or not, whether they do it well or not, they are acting.
And for economic experiences that require charging for the time customers spend with the company, such as charging an admission fee. Later, when the service economy took hold, busy parents ordered already- baked cakes from the bakery or grocery store, which, at US10 or 20, cost ten times as much as the packaged ingre- dients. It will come, but only if we act. Its no movie rental service, charging for each lent film. SensorialObservability Detectable Tactile Perceivable Sensible Knowledge Information Content Level1 Noise Data Information Wisdom SocialPrimary Flows Physical Financial Informational Individual Figure.1 Original table detailing experience and transformation offerings sundbo print (M3217).indd 24sundbo print (M3217).indd 24 15:52 15:52 The experience. (2000 The Age of Access: The New Culture of Hypercapitalism, Where all of Life is a Paid- for Experience, New York: Jeremy.
(1968 The Empty Space, New York: Touchstone. Then he charms his host with the unique blend of street theatre that is the Geek Squad experience while demonstrating his expertise in fixing any and all personal computer issues. 2.4.4 The Experience is the Marketing No matter the business, today every company competes with every other company in the world for the time, attention and money of potential customers the currencies of the experience economy. 361) because services cannot be physically inventoried and therefore create no tangible testament that work had been done. Similarly, Pleasant Rowland opened her first American Girl Place in Chicago in late 1998. (1987 Future Perfect, Reading, MA: Addison- Wesley. By the latter half of the twentieth century more people were employed in services than in goods as the former comprised a greater portion of GDP than the latter. We value the discussion of values.
3) makes the point: Consumers buy bazaars full of goods, but only to create the diversified experience they ultimately seek and goes on to show with a wealth of data that those goods (and services, for that matter) that enable consumer. With transformations, the economic offering of a company business is the change in the individual person or company changed as a result of what the offering company business does. With transformations, the customer is the product! 2.6 THE present state OF THE experience economy Joe once gave a boardroom talk in Milan, Italy, to a number of executives from different companies. In fact, the megatrend that incorporates both mass customization and the experience economy is best summed up as individualization creating more and more value for individuals by getting closer and closer to what each individual truly wants and needs, culminating. Transformations sundbo print (M3217).indd 32sundbo print (M3217).indd 32 15:52 15:52 The experience economy: past, present and future 33 take Erfahrung experiences and so integrate them into a customers life such that they change that customer not just.
Then he said to himself, Whoa. Companies seek out differentiation as their past offerings increasingly become commoditized while their customers seek out greater value for themselves as their wealth grows, desiring to spend their hard- earned money, their harder- earned time and their hardest- earned. Second, concerning services, more companies should direct their employees to act. Countless chains have met their demise in this timeframe as they insisted on merely merchandising finished goods. Here companies should embrace what exactly they say (in any form) about their business and its offerings, and understand how and whether that matches the reality people encounter. And turn sundbo print (M3217).indd 22sundbo print (M3217).indd 22 15:52 15:52 The experience economy: past, present and future 23 it into a memorable event, an experience! And together in Cleveland they mulled over the not- quite- complete and still- unrefined table (Figure.1 growing in their mutual appreciation for how the recognition of these two newly identified economic offerings could help executives think differently about.
Customization (serving customers uniquely) is basically the sundbo print (M3217).indd 26sundbo print (M3217).indd 26 15:52 15:52 The experience economy: past, present and future 27 antidote to commoditization. Welcome to the commodi- tization of experiences, best exemplified by the increasingly voiced phrase, Been there, done that. All figure content in this area was uploaded. Endless debate over health insurance would shift to actual innovation in healthcare, in which people would be charged only for the ongoing ensurance of wellness. Instead of interviewing prospective employees the company auditions them. Gilmore.1 introduction, it has been almost 20 years since we first described the next emerging wave of economic history as an experience economy. First of all, people were more than ready to embrace a new way of thinking about their offerings, as evidenced by the call to exceed expectations and other similarly wanting business buzzwords and mantras. And Joe shot back: Mass customization automatically turns a service into an experience.
As the Geek Squad again exemplifies, companies must recognize that their employees are on stage and therefore need to act in a way that engages their customers. No matter the offering commodity, good, service, expe- rience or transformation customers will judge it based on whether or not they view it as authentic, whether or not it conforms to their own self- image. And in paying for it; it may be paying for demonstrated outcomes that would bother people the most if they thought about it But that day will come. Jay Ogilvy, co- founder of the Global Business Network, wrote The Experience Industry, a 1985 report for SRI International, demonstrating that demand for vivid experiences already drove marginal growth in the US economy a factor that has only accelerated. Rather, the company charges a monthly fee and subsumes the rental service in a movie- viewing subscription.
New forms of economic output do not come automatically. But it does not help if others then make reference to a dream economy or a creative economy. It is not really true, however, that the dissertation For the love of experience (Snel, 2011,. Note, for example, in the original table of the Economies of Man shown in Figure.1 that Co- production is listed as the method of production and Participated in at creation as the Method of Delivery. They are not a new economic offering think of traveling troubadours, Greek plays, Roman competitions, commedia dellarte performances just a newly identified one. So let us here be most clear: goods and services are no longer enough to foster economic growth, create new jobs and maintain economic prosperity. But both consumers and companies increasingly found services of great value, enhancing their lives and their businesses, respectively, and so purchased them more and more frequently. (2011 For the love of experience: changing the experience economy discourse, PhD dissertation, University of Amsterdam, Amsterdam. In the mid 1990s, when we wrote the popular How to profit from experiences in The Wall Street Journal (Pine and Gilmore, 1997) and the more scholarly Beyond goods and services for Strategy and Leadership (Gilmore and Pine.
Sundbo print (M3217).indd 35sundbo print (M3217).indd 35 15:52 15:52 36 Handbook on the experience economy Relying on the manufacturing of goods and the delivery of services remains the mindset of too many executives (and politicians prohibiting the shift to more vibrant. The Law of Comparative Advantage applied once again, as people increas- ingly ceased doing certain service activities themselves and instead paid someone else who could do them more efficiently, more effectively and with higher quality. (1985 The Experience Industry: A Leading Edge Report from the Values and Lifestyles Program, report 724, Menlo Park, CA: SRI International Business Intelligence. Barabha and Gerald Zaltman, Hearing the Voice of the Market: Competitive Advantage through Creative Use of Market Information (Boston: Harvard Business School Press, 1991. Unsuccessful treatments that fail to remedy ailments would not be compensated fully (just as one doesnt pay a plumber who fails to fix a leaky sink and new financial instruments tied to actual performance perhaps securitizing future earnings streams of successfully. We discovered that up- and- coming companies the true innovators more and more were experientializing their goods, surrounding their services with engaging events, creating new and wondrous experiences, and eliciting transformations within those who seek help in achieving their aspirations. Stagecraft it is, and frankly, more busi- nesses besides show business need to embrace theatre as their model for directing work. But yes, still, we primarily do so from an viewpoint, from the supply side not getting much into a viewpoint concerning the formation of tastes and preferences, from the demand side.