A Society Hungry for Experiences: How Your Brand can WIN Business by Focusing on Experience
From the Great Depression in the 30s and WWII in the 40s all the way until today, we have evolved into a society hungry for experiences. If it saves us time, keeps us active, entertains us, makes us feel good, look good, inspires us, or whatever, we will pay for it. In order to have the best experiences, we have developed systems that we trust. Today we have reviews and referrals. In the near future, we will have advanced sentiment analysis data alongside videos of our friends sharing their insights popping up on our eyeglasses as we walk into or near a particular business.
The Experience Economy
In a 1998 issue of the Harvard Business Review, the article “Welcome to the Experience Economy” was published. The authors outlined the evolution of the Experience Economy and its impact on the progression of economic value. While they wrote this over 20 years ago, it is more relevant today than it was then. In this insightful article, they used the evolution of the birthday cake as a model to explain the theory.
Here is that story through the filter of SocialSurvey CEO Scott Harris:
When Scott’s father was a child, his mother would take ﬂour, butter, eggs and sugar and make a cake. The ﬁnished product would likely have cost a couple of dimes.
When Scott was a child, his mother would buy Betty Crocker’s boxed cake mix. She paid less than $1 for the ease of color by number instructions, perfectly measured and mixed ingredients, and savings of time and mess.
When Scott’s first-born child was a toddler, he would run into the local grocery store on her birthday and point to one of the cakes. Five minutes later, he would be walking out with a personalized treat, featuring her favorite Disney princess. Seemed like a bargain at $20.
Today, for Scott’s younger children, he will break the bank ($300+) for a birthday party experience, and often they throw in the cake.
Imagine how today’s reality would fit into any of the other eras—it wouldn’t. In the 40s we were just emerging from the Great Depression and entering World War II. It is very hard to imagine bounce castle businesses and trampoline parks popping up on every corner in those days. Clearly, the evolution of economic value is a steep arc from then until now. Today, we value experience and are happy to pay for it.
THE AMAZON EFFECT
Scott cares a lot about reviews. So it makes sense that his kids, like 10-year-old Charlie, do too. Charlie wanted DJ equipment for Christmas, so he took to Amazon for research. He knew that his dad is frugal and sorted by price. Charlie found several options and dug into the reviews. When he came to Scott to make the ask, he was armed for victory.
“Dad, I want a Pioneer DDJ-SB3 for Christmas. It’s a DJ board. It’s only $227 and I read the reviews,” he said. “It has a 4.6 star rating with 187 reviews on Amazon and most of the unhappy people just couldn’t ﬁgure out how to use it.”
Scott’s 10-year-old son knew exactly what he wanted, even though he had never used or seen it on a shelf. He is a different kind of buyer than his father or father’s father. He relies on Social Proof.
Social Proof, a term coined by Robert Cialdini in his 1984 book, Inﬂuence, is also known as informational social inﬂuence. It describes a psychological and social phenomenon wherein people copy the actions of others in an attempt to undertake behavior in a given situation.
Companies are now forced to listen to the voice of their customers and constantly improve their products and service levels. Consumers are influenced by and are making purchasing decisions based on others’ reviews – it’s social proof. A company’s success is controlled by customer experiences.
Charlie doesn’t like going to stores. He’d rather take 10 minutes and find the best product at the best price online, further underlining the reality of the Experience Economy today and shows that Customer Experience drives business outcomes more today than ever before.
LOCAL BUSINESS IMPACT
What about local stores, cafes, or restaurants? Nowadays, looking up a new restaurant on Google or Yelp is as natural as breathing.
Such is the case for Scott’s 16-year old daughter, Bailey and 39-year old girlfriend, Emma, who are both big coffee fans.
They love the coffee shop experience, and that didn’t change when on vacation in Newport Beach, CA. While walking the boardwalk, Emma noticed a coffee shop and announced to Bailey that they should check it out. Without slowing down, Bailey said, “Nah, I looked them up and they are only 3.5 stars.”
She hadn’t even walked through the front door, and they had already lost her business. Maybe her experience would have been fantastic.
Maybe the shop just wasn’t managing their online conversation.
In any case, they likely lost $100 or more of Bailey and Emma’s business throughout the course of their vacation, because they need social proof. Bailey knows that coffee shops with a high quantity (volume) of great reviews (quality) and lots of product photos are likely to give her the best experience—which she truly values.
And why wouldn’t she? The people that went into that coffee shop had taken the time to go online and say, “Eh…It’s just ok.” Just a minute down the boardwalk, Bailey and Emma found a better option with a higher rating. Every morning that week, the better option got their business. The Newport Coffee Company was glad to take their family’s morning orders.
In an Experience Economy, a company must not only provide awesome products and services, but also manage what’s happening online.