Marketing in the Experience Economy

Way back in 1998, Pine and Gilmore's Harvard Business Review article about the Experience Economy outlined a four-step progression from undifferentiated commodity positioning/market pricing to the highly differentiated culmination of staging an experience at premium pricing. "To realize the full benefit of staging experiences, however, businesses must deliberately design engaging experiences that command a fee," the authors wrote.

Today, consumers are surrounded and distracted by more potential experiences than ever--facilitated by connectivity and ever-present digital devices. In a very real sense, then, marketing must be ever-present and available to reach customers and deliver experiences when and where desired.

In fact, material goods are so ubiquitous that consumers often crave an interesting or unique experience in conjunction with a purchase OR rather than the purchase of a tangible item. (Think "Spotify" instead of music download, for instance, Uber car service instead of a traditional taxi service.)

Not surprisingly, consumer behavior favoring experiences is having an effect on the retail industry. Stores can't simply be stores. Prices can't simply be prices. Showrooming and webrooming rule. The key to marketing in this experience economy is to understand your customers and adapt to their needs and wants--quickly--with appropriate/differentiated offerings and customer services that set the offering apart from competing offerings.

Even purchases like Uber rides are actually experiences, especially since both driver and passenger rate the experience. Bad experience? Bad rating. Good experience? Good ratings add to the potential for further differentiating this offering and charging more for the experience.

Major League Soccer's New Brand Logo

It's a new branding era for Major League Soccer. As the 20th season of the league approaches, it wants to signal the next stage in its North American growth. So the boot and ball are gone, replaced by this striking new brand logo that lends itself to team-by-team adaptation. Here's what the MLS's CMO told Sports Illustrated about this latest version of the brand logo:

The more modern brands of the world don’t need to telegraph a specific category or line of business they’re in. In many cases, they stand for something much bigger. A great example of that is Apple.

Not everyone is enamored of the new logo. A Boston Globe writer says: "... while I don’t have a great sense for design, I’m not sure I even like the new logo. But I do find the switch itself interesting. It conveys that MLS, which is calling the rebranding effort ‘MLS NEXT,’ thinks it’s entering a new era."

I definitely agree--MLS is using this modern brand element to reflect its emergence as an established sports league. No longer a startup that has to explain itself over and over, the MLS of today has big-league players, major media coverage, good audience numbers, and marketing confidence.

In fact, MLS has become so good at marketing the game experience that college football is using it as a model.

Pop-Up Shops Are Mainstream Marketing

Pop-up shops are no longer a passing trend--they're a mainstream marketing method used by brands, businesses, and even government groups to achieve one or more of these objectives:

• Increase brand or product awareness
• Introduce or test a new brand or product or line
• Reinforce brand image associations
• Reach new markets or segments
• Communicate brand benefits
• Provide a tangible, tactile brand or product experience

With the exception of seasonal retailing, such as stores selling Halloween costumes or Christmas products, pop-up shops are not necessarily aiming to make sales. Instead, communication and branding objectives usually take priority, even when revenue is involved.

For example, Kraft in Canada has planned a series of pop-up shops to reinforce the emotional connection between customers, Kraft dinner products, and fun family times. For three days, Kraft will operate pop-up shops in Toronto, Vancouver, and Montreal, bringing the "fun" aspect of the brand to life. "It’s not enough to tell consumers to go out and have some fun," explains the brand director of Kraft Dinner. "We also want to create experiences that enable them to do so."

When the owners of Parlor Blow Dry Bar wanted to launch their new business in the Raleigh, North Carolina market, they began with a pop-up shop in a high-traffic area. "A pop-up is not something for financial gain," says one of the owners. "It’s a great way to introduce a concept and get to know people." Now the owners have a better idea of which customers prefer which services, an invaluable element in crafting marketing strategy for the new business.

The Canadian government has even used the pop-up shop concept to open a temporary office in Pittsburgh promoting trade between Pennsylvania and Canada. The space was called "Pop-Up Canada!" and remained open for four days, inviting local businesses to learn more about trade, energy, and investment. The opening featured, naturally, a hockey face-off, and the Stanley Cup made an appearance. The point was to highlight close economic ties between Canada (Canada as a brand) and U.S. businesses and of course to encourage more trade.

Read more here: http://www.newsobserver.com/2014/07/12/3999999/triangle-pop-up-stores-proliferate.html#storylink=cpy

Experiences, not Possessions

In today's challenging economic climate, consumers are seeking out experiences over possessions. The top theme parks in Asia are thriving, and well-recognized brands such as Legoland are pursuing expansion plans. This trend toward experiences opens important doors for marketers who can:

1. Build on competitive differentiation to create unforgettable memories. One theme park is not like another--each has (or should have) a distinctly different personality and experience possibilities. The same holds true for any experience being marketed. Reinforce brand associations by providing specific, tangible anchors and consistent customer service levels. Be sure customers recognize what will make your experience stand out from all others; be sure they know what to expect; and be sure you can deliver on those expectations.

2. Encourage engagement before, during, and after the experience. This isn't just a matter of social media. Use all manner of marketing communications to build anticipation in advance of the experience, focus customers on the unique elements that make the actual experience so memorable, and encourage sharing of ideas, feelings, and feedback throughout the process.