Thomas E. Ambler reviews
The Experience Economy
Commoditized? Could it be that the Experience Economy offers hope for your situation? So what is the Experience Economy?
Years ago a successful birthday party centered around the cake Mother made from scratch. Today, a “successful” birthday party must be staged at some special place like Club Disney. And we are willing to pay a thousand times more for such a birthday “experience” than we are for the raw ingredients of a birthday cake!
Historically, our economy has had three outputs — Commodities, Goods and Services. “Staging Experiences” has become a fourth, previously unarticulated and higher value economic output. While Commodities are fungible, Goods tangible and Services intangible, Experiences are memorable.
Staging experiences is about engaging customers. The richest, most memorable engagements involve all Four Realms of an Experience — Entertainment, Education, Escape, and Estheticism plus the five senses.
Initially, in your transition to the Experience Economy you may give a free experience to sell your existing goods or services. However, “you are what you charge for.” Ask yourself: “what would we do differently if we charged admission?”
One whole chapter is devoted to the application of Mass Customization to staging experiences. This is appropriate, but hardly surprising. After all, Joseph Pine is the author of the award-winning 1993 book, Mass Customization.
In the Experience Economy, business performances must rival those featured on Broadway and in ballparks. Throughout the book the authors develop a powerful analogy between business and the stage.
Beyond Staging Experiences there is yet a higher level of offering — Guiding Transformations. Why do young managers leave wellpaying jobs to spend tens of thousands of dollars on business school? To be affected by the experience, to be transformed.
Being in the transformation business means charging for the demonstrated outcome the aspirant achieves. For example, if a fitness center were truly in the transformation business, it would charge not for the “pain” but for the “gain.”
With transformations, the customer is the product.
As the Experience Economy naturally progresses into the Transformation Economy, even experience stagers will find their offerings commoditized. The authors contend that Transformations are the fifth and final offering-one that will not be commoditized.
Don’t let yourself get left behind in a commoditized backwater. Instead, let this exceptional, philosophical, yet highly practical, book provide a potentially transformational experience for you!
Score another 10 on the Ambler scale this time for The Experience Economy!
For more information or to order your copy of The Experience Economy from Amazon.com, click on the title.
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