The Experience Economy

Lawrence Appell & AssociatesMaximizing Your Return on Investment in the Cost of a Prospect The Experience Economy

The Experience Economy Manufacturing products and providing services are no longer enough. Experiences are the foundation for future economic growth. Successful companies will use products as props and services as the stage to create experiences that will engage customers in personal ways. From the Experience Economy: Joseph Pine & James Gilmore Lawrence Appell & Associates 2

The Experience Economy The Progression of Economic Value Differentiated Relevant to Stage Experiences Deliver Services Competitive Needs of Position Customers Make Goods Extract Commodities Undifferentiated Irrelevant to Market Pricing Premium Lawrence Appell & Associates 3

The Experience Economy Example: Price of Coffee OfferingsDifferentiated Premium Starbucks Experiences Coffee Vendors Services Pricing Roasted / Ground Coffee Goods Coffee Beans CommoditiesUndifferentiated Market Lawrence Appell & Associates 4

The Experience Economy Example: Price of Birthday OfferingsDifferentiated Premium Get Cake with Staged Party Experiences Buy Cake from Services Bakery Pricing Bake Cake using Mix Goods Bake Cake from Scratch CommoditiesUndifferentiated Market Lawrence Appell & Associates 5

The Experience Economy Example: Insert Your Idea Here!Differentiated Premium Experiences Services Pricing Goods CommoditiesUndifferentiated Market Commodity Goods Service Experience Lawrence Appell & Associates 6

The Experience Economy Staging Customer Surprises What Customer Actually Gets Customer Surprise = Minus What Customer Expects to Get Lawrence Appell & Associates 7

The Experience Economy Staging Customer Surprises Example 1 I got a free lunch! I ll never forget the = Minus time when... I expected to pay $7.50 Lawrence Appell & Associates 8 Westlake Management Company, LLC

The Experience Economy Staging Customer Surprises Example 2 I sampled sushi & loved it! I ll never forget the = Minus time when... I thought sushi was raw fish Lawrence Appell & Associates 9

The Experience Economy Six Cues to Creating Positive Impressions 1. Time: traditional vs. contemporary vs. futuristic 2. Space: city/country, east/west, indoor/outdoor 3. Technology: hand-made/machine-made, natural/artificial 4. Authenticity: original or imitative 5. Sophistication: refined/unrefined, expensive/cheap, easy/ difficult 6. Scale: large/small Lawrence Appell & Associates 10

The Experience Economy Eliminate Negative Cues 1. Signage: information that must compensate for poor design… (e.g. order here , pick-up here , wait here …) 2. Clutter: stuff that has nothing to do with the experience… (e.g. newspapers, flyers, solicitations, etc…) 3. Wear & Tear: fixtures, furnishings & equipment that needs replacement or repair 4. Behavior: Poorly trained staff Lawrence Appell & Associates 11

The Experience Economy

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