THE EXPERIENCE ECONOMY

The Importance of Markets…

• Financial markets

• Marketing, brands, products

• Competition, strategy, positioning

• Markets as culture

A Style of Consumption

Culture of consumption: To find a style of consumption and „improve yourself” through consuming good and services

Experience Economy

An economy of highly customized goods and products aimed at a mass market, dealing in experience rather than traditional goods and services

Mass customization

The experience economy is an advanced management ida based on mass customization. The activities of suc organizations are like theatre, where goods and services are used as stage props (Pine & Gilmore, 1999).

Organizations in the Experience Economy

Stage memorables experiences for their clients,

Memory itself is part of the product,

Advanced firms collect a high „transformative” fee for esthetic or educational values; often high value based on contact with high level specialists or artists

Consuming Experience

“Clients do not consume products for their matereial usefulness but, rather, for their symbolic value expressed in images.” (Elliott, s. 2011); „Products to think, products to talk.” (Fiske, 1989); Symbolic capital of the consumer (Bourdieu, 1984): codes of taste, identity symbols.

Symbolic value

Symbolic value is becoming more important for some consumers than material value or usefulness, •Consumers are identified people in serach for an identity and/or its creators (Saren, 2006). •Body and soul as consumption sites.

Evolution of the Product

Pine & Gilmore:

Commodities

Goods

Services

Experiences

Transformation

Stage Experiences

Deliver Services

Make Goods

Extract Commodities

Co

mp

eti

tive P

osit

ion

Need

s o

f C

usto

mers

Rele

vant

to

Irre

levant

to

Pricing Market Premium

Undiffe

rentiate

d

Diffe

rentiate

d

Source: Pine and Gilmore (1999)

Extracting Commodities

• The simples form of market activity

• Undifferentiated

• Irrelevant to the needs of customers

• Market pricing

Making Goods

• Dominant in the mass market age.

• Relatively undifferentiated

• Little relevance to the needs of customers

• Mostly market pricing

Delivering Services

• Currently dominant form of sophisticated economic activity

• Differentiated

• Rather mindful of the needs of customers.

• Premium pricing

Staging Experiences

• Economic transaction as a spectacle

• The most sophisticated form of market activity

• Highly differentiated

• Very mindful of the needs of customers.

• Premium pricing

Leading Towards Transformation

Future market strategy

Consumption that helps to reach a higher state of mind or acquire higher values

Highly individualized; self-actualization

Premium pricing

Gourmet holidays Bon Appétit Brittany

Experience Economy as a Process

Ethnographies of experience economy organizations show that there are wide implications and a great potential for improvization around the idea (Hjorth & Kostera, 2007), for example:

Art gallery (Katja Lindqvist)

Film festival (Senada Bahto)

Event industry (Marjana Johansson)

Sports (Hans Lundberg)

Even farming (Frederic Bill)

Betamax Management Fashion?...

Not necessarily – experience economy teaches about the importance of culture projects:

• Makers, artists, projects of culture